Category Archives: Inside Track

Demi’s Basic Business Questions: What is Commercial Awareness?

This week instead of looking to myself for the answer to your questions, I looked to you for the answer to the meaning of Commercial Awareness. Commercial awareness is a phrase I’ve been seeing lately all over commercial law applications and all over financial and professional services sectors too. My idea of commercial awareness has always been wishy-washy and recently I’ve wanted to gain a more succinct definition.

To achieve my objective, I asked a few students from Trinity and UCD how they would define commercial awareness. 

I spoke to students from business backgrounds who gave exhaustive responses:

 “Being cognisant of the way businesses operate and affect our lives and how we affect businesses” (1st Year BESS), 

“..being able to tack together different current affair stories and making real sense of them for your industry,” (2nd Year Law and Business)

“..understanding the external environment that impacts the specific industry, i.e the Political. Economic, Social, Technological, Legal and Environmental factors (PESTLE)..” (1st Year Global Business)

I also spoke to law students like myself, who kept things short and simple:

“..an understanding of how businesses work”

“Knowledge of a business or company, which is important if you want to get recruited by that company!”

I spoke to older students whose responses were.. interesting, to say the least:

“It means being aware, commercially of course.” (3rd Year Biomedical Sciences)

“Being able to tell the difference between all the ads or commercials on TV” (3rd Year Children’s and General Nursing)

Not only was I able to get student insight, I was able to get some industry perspective on commercial awareness too. My application for Legal Cheek’s Commercial Awareness Question Time with Matheson, Barbri, Pinsent Masons and Arthur Cox was successful so I was invited to attend the event at the Law Society.

The Commercial Awareness Question Time taught me the wide range of issues that commercial awareness encompasses. It ranges from having an in-depth knowledge of what the implications of Brexit are on the legal sector to knowing that a company is a brand that has to sell and distinguish itself from competitors. 

Nearing the end of my search for “commercial awareness”, I’ve come to the realization that commercial awareness is as broad or as succinct a definition as we want it to be. It really is as simple as taking a little time out of your week to become “..aware, commercially of course” by following some financial institutions, newspapers or even keeping up with my Basic Business Questions.

If you have any more Basic Business Questions you are interested in me tackling, please do not hesitate to email me at dadenira@tcd.ie

Yours in Learning,

Demilade

Demi’s Basic Business Questions: What is Corporation Tax?

We often see headlines about Ireland’s low corporation tax – some are critical, others ecstatic about it. A pretty common question people have is what exactly is corporation tax, and how does the tax big corporations like Google and Facebook pay affect someone like me, the average college student. The aim of the following article is to give a bite-sized introduction to corporation tax and give some guidance on whether it is to be loved or hated.

Firstly, a definition. Corporation tax is the tax companies pay in countries they are resident in on the profit they earn from their business. In Ireland, the tax is at 12.5%, significantly lower than other countries. The average corporation tax rate in Europe is 25.3%, for example. 

Similarly to when we looked at why it is not feasible to print more money in order to combat financial crises, we are brought back to one of the fundamentals of economics – the law of demand. Generally, when something costs more money, less people want it. When something costs less, more people want it. Pretty reasonable, right?

The law of demand can easily be applied to our low corporation tax scenario. If it costs less money to make profits in Ireland (due to the low corporation tax), more corporations will want to set up here. It is argued that this is a positive phenomenon as it leads to Ireland becoming an international hub for multinational companies. Where there are increased companies, there are increased jobs. This reduces the number of skilled young people, university graduates etc. emigrating in search of work. Increased employment boosts the Irish economy and is often something to smile about. 

However, on the other side of the coin, those who are against our competitively low corporation tax level make strong arguments. They point to the profits that corporations such as Twitter and Facebook make and suggest better use for those profits, such as contributing to social welfare schemes. It is also argued that we are putting ourselves at an advantage at the expense of fellow European countries. The discrepancy between corporation tax rates is so high that it is a significant challenge for them to compete. This can be seen as unethical. 

There are numerous points to be made on either side of the debate but it is up to you decide where your opinions lie. 

If you have any more Basic Business Questions you are interested in me tackling, please do not hesitate to email me at dadenira@tcd.ie

Yours in Learning,

Demilade

Demi’s Basic Business Questions: Why Can’t We Just Print More Money?

Money makes the world go round. The converse is also true. Lack of money can make the world stop. This is the reality for many – their worlds are at a standstill because of a lack of money. Because of poverty.

Ending poverty is one of the United Nations’ Sustainable Development Goals to be achieved by 2030. According to the UN, 700 million people live in extreme poverty. Sometimes, grave situations like these cause business newbies like myself to ask the question, “Why can’t we just print more money?”. Unfortunately the solution is not that simple.

Printing more money may be a possible quick fix, but it is only sustainable temporarily. Printing more money can make poor countries even poorer in the long run.

Money is worth the value we give it. If people didn’t believe money to be valuable and accept it in exchange for goods and services, it would simply be like another piece of paper.

Inflation refers to a general increase in the price level of goods and services. This can be caused by increased money in circulation or by people’s incomes rising. The more money readily available, the easier it is to buy things and the more people will want to buy things. Businesses are profit driven and will increase their prices as people can now afford to pay more while not increasing their supply . This is the law of demand – as price increases, demand decreases. More money does not mean less problems, more money simply translates to higher prices. 

We are not the only ones who have flirted with this idea of printing more money in order to increase the standard of living. In order to fulfill the payment of reparations after the war that had made them poor, Germany in 1922 printed money. On the surface it seemed like an excellent idea. In reality, however, they could not have been more wrong. This led to hyper inflation, meaning prices were so inconceivably high that money became next to worthless. It was not uncommon for people to use their money to burn fires. 

Poverty is a pressing issue and it is imperative that we continue to generate solutions on how to tackle it. Unfortunately, money printing is not the one for us today. 

If you have any more Basic Business Questions you are interested in me tackling, please do not hesitate to email me at dadenira@tcd.ie

Yours in Learning,

Demilade

Use criticism to develop yourself!

By Neha Verma

At some point in life, we all face criticism personally or professionally. Criticism doesn’t come easy and at times it is difficult to acknowledge the same. We often get bogged down by the criticism so much that we ignore what we can actually learn from it. So instead of retaliating or being defensive; pause for a while think critically and then respond – though easy said than done.

I am amongst those who would become extremely uncomfortable when criticized. My initial reactions were driven emotionally. I would carry the distress caused by criticism throughout the day and affect my work. Over the time, I realized that we don’t have control over others; how they judge and form an opinion about us, but we can definitely learn to respond in a better way and display our maturity.

If you are going through difficult time combating criticism, I have listed a few suggestions to face criticism bravely:

  • Criticism opens a whole new perspective which you might not have thought of. Life is a process of continuous learning and we learn best from our flaws.
  • When you accept criticism, you show humility towards the fact that you are ready to acknowledge your own weaknesses.
  • Criticism helps enhance your emotional quotient. You learn to listen.
  • Criticism makes you strong; you will learn to tackle difficult situations and people.
  • Criticism enhances your problem-solving skill and makes you a rational thinker.
  • Learn to let go unconstructive criticism, do not dwell on it for a long time and create a stressful environment for yourself.

We are often scared of being judged and are obsessed with the thought of what other people think of us. Most of the time, we receive unsolicited criticism/feedback and we tend to misinterpret the intention behind it. Criticism challenges our disposition and to maintain a calm demeanor becomes relatively difficult. But, remember you are being critiqued because you created something. So, next time when you are criticized, remember you and your work are being noticed. Don’t let opinion of others stop you from doing what you believe in.

Training is an investment, not an expense!

By Neha Verma

Training is an integral part of any organization; it equips the employees with skills required to perform the job. Every organization invests in training their employees that are responsible for giving results. Most organizations/businesses consider training as an expense when it is actually an investment.

There are numerous reasons to invest in training, like; improved quality or in other words reduction in errors or defects, enhanced productivity, increased motivation, helps in retaining the talent pool, capacity building, groom the leaders, etc. Training helps in building capacity within an organization and investing in people is vital as this is the workforce which can bring excellent profits to your business.

In the times of economic crisis, organization often control its budget by cutting down on non-core or non-billable activities, and unfortunately training is one of such activities – if not cancelled completely. However, training can help both employees and organizations in such challenging situations. With the advancement of technology and globalization, there are various methods to reduce the cost of training whilst maintain its effectiveness. Virtual classes, use of instructional system designs, video conferencing and other technological improvements have helped revamp the training making it cost effective. In this era of globalization, where organizations are spread across the globe, such advancement in training delivery techniques are highly cost effective and have reduced the need of face to face training.

Training should be designed to focus on immediate business need and to cater the various talent pool bespoke training or curriculum is the preferred way of keeping at pace with the organizational changes and needs. Training should be pragmatic in approach and directly applicable to day to day activities which will help organizations to measure ROI. An efficiently trained staff with improved skill set will have high productivity and quality, efficient at their job whilst feeling recognized and valued by management.

As leaders and managers, you are responsible for the success of your organization, and developing your people to increases your chance of success. For any organization, people are one of the biggest investments and they should not be left to rust.

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