Labour Market Competitive Advantage

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The aim of this assignment is to understand the concept of competitive advantage, resource based view, porters five force and the use of strategic map in the labour market. A labour market is the place where workers and employees interact with each other. In the labour market, employers compete to hire the best, and the workers compete for the best satisfying job. A labour market in an economy functions with the supply of skills and the labour market demands. Labour services are exchanged and those negotiations occurring between buyers(employer, firm or industry) and sellers(trade union) partly determine the placement of workers in jobs with specified wages, benefits, and conditions of employment. Labour market constitutes 3 main actors: the…show more content…
This is why it becomes imperative to develop this model separately for every industry even if the same company is competing across different markets and industries. In the labour market the bargaining power of the trade union who is the representative of the workforce, is fairly high. On the other hand, there is also a threat of new entry into the market given high potential of migrant labourer with high degrees of proprietary knowledge and skills. There is also threat of substitutes in various forms by way of machineries and modern equipment and technology. The power of suppliers in the labour markets is also high as they supply the vital most input for the industry. Generic competitive strategies 1. Cost leadership strategy The goal of cost leadership strategy is to offer products or services at the lowest cost in the industry. Products are to be created at the lowest cost in the industry and this can happen when labour is skilled and at the same time reasonably cheap. 2. Differentiation strategy The goal of differentiation strategy is to provide a variety of products, services, or features to consumers that competitors are not yet offering or are unable to offer. This strategy gives a direct advantage to the company which is having a unique work force to produce a product or service that none of its competitors are having such

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