Businesses often scout for talent, and hire candidates, based on a simple principle. The more technically qualified a candidate is for a role, and the better they fit into the company’s existing culture, the better. In the short term, this makes perfect sense. New hires who can culturally integrate into the team and their new roles with minimal effort can become productive more quickly than less qualified candidates could. In the longer term, though, businesses are forced to deal with a cost that comes with this strategy. By pursuing the path of least resistance with regard to integrating new hires, businesses sacrifice diversity.
When businesses go looking for financing, they rarely do so with a great deal of time on their hands. Whether they’re hoping to seize a growth opportunity, or dealing with an unexpected cash flow problem, time is nearly always of the essence. Depending on the urgency and the nature of their particular situation, this often forces businesses to accept unfavourable interest rates. Worse, some businesses will simply apply for business loans with many institutions at the same time, hoping to qualify for a good rate with one of them. While that might work once, it can wreak havoc on the business’ credit profile.
In order to compete, businesses are forced to find a balance between producing competitive products and services, and managing costs. Businesses that fail to keep costs low can’t maintain competitive prices, but those who cut costs too aggressively can’t compete on quality. The most successful businesses are those that can work most efficiently, getting the most out of every dollar invested. That means not just slashing budgets to reduce overhead, but strategically finding ways to manage costs that don’t affect the business’ ability to perform.
Getting involved in politics can have unpredictable positive or negative results, which is why most brands actively avoid taking a firm stance on major social and political issues. After decades of slow social progress, however, businesses are turning out to support, and to potentially capitalise on, gay pride and the broader LGBTQ rights movement. Gay pride events attract millions of people to major cities all over the world, and the potential boost to businesses who can cater to the community is very significant.
The cost of renewable energy, particularly solar power, has dropped dramatically in the past two decades, to the point where 80 percent of new solar projects in 2019 are projected to outcompete even the cheapest oil, natural gas, and coal projects. The average cost of installing new solar panels in 2019 is just over $3 USD/watt, down from $12/watt 20 years before.
It’s difficult for businesses to determine how much to invest in their own growth, and how aggressively to pursue opportunities that present themselves. Driving innovation and product development, hiring and training new workers, expanding facilities, and other costs of growth ultimately draw on working capital that is needed elsewhere.
The Fair Work Commission has announced a minimum wage rise of 3 percent starting on July 1. While businesses argued for the wage hike to be limited to match the 1.5 per cent inflation rate, it’s still just half of the 6 percent that the Australian Council of Trade Unions hoped to achieve. Even this relatively modest wage increase will create real difficulties for many businesses though, particularly those who rely most on low income workers, like the hospitality and the embattled retail industry.
The issue of low wage growth has recently dominated headlines in Australia’s political discourse. Considering the weight that the issue currently carries, it’s surprising that Gartner’s quarterly Global Talent Monitor found that Australian workers didn’t even place it into the top 3 in their list of concerns. Rather than just underpaid, workers feel disrespected and burnt out.
The construction industry can be lucrative, but it comes with its own share of risks that businesses need to manage if they want to succeed. The amount of time that passes between breaking ground on a home or building, and collecting revenues from the sale of that home are often very long. Meanwhile workers and subcontractors need to be paid, and those subcontractors need to make their own purchases in order for projects to progress. The resulting financial pressures can make it difficult for both large builders, and their smaller subcontractors to operate efficiently.
Businesses are constantly innovating and finding new ways to access the labour, supplies, and markets they need to grow and thrive. Over time, this has driven globalisation, bringing down trade barriers, and helping companies to do business more directly and efficiently over greater distances. It’s also the driving force behind digitalisation in business, giving them the ability to communicate, share data, send funds, and collaborate instantly. However, it has also made financial management much more complex.