Business Effectiveness and Efficiency: Ethics, Productivity, and Changing Careers, Summaries of Economics

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Focusing on the Right Things

Effectiveness and Efficiency

Business Focus

• Businesses often study their own operations to know whether they are efficient and effective.
• Effectiveness means making the right decisions about what products and services to offer customers and the best ways to produce and deliver them.
• Efficiency means producing products and services quickly at low cost, without wasting time and materials.
• Global competition is the ability of businesses from one country to compete with similar businesses in other countries.
• Businesses today focus efforts on gathering information from consumers, studying their buying habits, testing new products with prospective customers and adding new features to existing products. New designs,, different materials and colors, understandable instructions and ease of product use are features that customers use.

Achieving Competitive Advantage

• Workers are more productive when they are well equipped, well managed, and well trained.
• Efficiency – including improved productivity – can be achieved in 3 ways :
• 1.Specialization of effort.
• 2.Better technology and innovation.
• 3.Reorganiation of work activities.
• Efficiency can be improved through advanced technology.
• Technology includes equipment, manufacturing processes, and materials from which products are made.

Gross Domestic Product

• The chief measure of a country’s economic wealth is the gross domestic product (GDP). - Income that escapes being recorded in the GDP is referred to as the - Underground economy.
• The labor force includes most people aged 16 or over who are available for work, whether employed or unemployed.
• Some people have found it difficult to get jobs or be promoted on an equal basis.
• Some people encounter difficulties in being promoted at a certain level. This has come to be known as the glass ceiling – an invisible barrier to job advancement.

Business Ethics

• Business ethics is the collection of principles and rules that define right and wrong conduct for an organization.
• Code of Ethics is a formal, published collection of values and rules that reflects the firm’s philosophy and goals.
• The issue of ethics arises when it is not clear whether a particular action is legal or illegal. This is a situation of an ethical dilemma.
• One approach is to ask the question – What is the value or worth of a specific behavior for society as a whole?
• Firms have to choose between the ethical practices of the foreign country and of their home country.

Ethical Issues

• Laws provide a minimum standard of behavior for people and businesses to follow.
• But, many behaviors are neither allowed nor disallowed by law.
• The guide that comes into play is ethics.
• Ethics refers to standards of moral conduct that individuals and groups set for themselves, defining what behavior they value as right and wrong.
• To decide whether an action is ethical or not, we may ask: Is the action right or is it wrong regardless of what the law states.

Case Study

• Endangered Careers
• Some jobs may be healthy like the BPOs, but there are indicators that some jobs are becoming obsolete. Jobs facing decline include stock clerks, order fillers, computer operators, secretaries, telemarketers, parts salespeople, and telephone operators. Because of advances in technology and corporate changes many careers are endangered. The growing use of computers for inventory control, and the installation of new, automated equipment are expected to replace the jobs of stock clerks and order fillers.
• The growing volume of imports, greater use of offshore assembly of goods and products, and increased productivity due to automation also contribute to more losses of employment. Telemarketing jobs are losing to social media platforms. The ordering and reordering of products were replaced by the e-commerce technology systems and are now automated making more people loss their jobs. Voice recognition systems don’t need operators in the telecommunications system and the use of other forms of communication contributed to this decline.

Growth Areas

• The growing areas in employment opportunities include the BPO industry, pharmaceuticals for the large number of senior citizens, entertainment products, latest technological devices, and household appliances. However, the Overseas Filipino Workers and professionals continue to be in demand, so employment opportunities overseas are plus factors.
• Think Critically
• 1.Why should industries and entrepreneurs pay attention to national trends for different occupational areas?
• 2.Why should buying habits of senior citizens be considered when determining business ventures whether domestic or international?
• 3.How has international trade affected employment opportunities for Filipinos?
• 4. Is the BPO industry a savior for unemployment, and in what ways?