301 - Change Flashcards
What is change?
Change is an ongoing process, businesses cannot avoid having to deal with its consequences, it can be gradual or rapid.
Factors that cause rapid change
Change in ownership, developments in technology, market changes, changes in consumer taste, legislation changes, changes in the workforce, changes in the economy, change in the size of the business.
Internal causes of change
Introduction of new technology, a change in management structure/leadership style, a change in the size of the business.
External causes of change
Developments in technology, market changes, changes in consumer taste, new legislation, changes in the workforce, changes in technology.
Planned change
Created internally, structured and timetabled, clear objectives, resources are applied.
Unplanned change
A response to a shock in the business, unstructured and under resourced, could be internal (a key worker leaving) or external (2007/2008 financial crisis).
Affect of change: needing to change production methods/update equipment
Production methods will need to change to match customer demands, which will needs research and development, and producing/adopting new technology.
Affect of change: needing to develop new products
Needs strategic planning, needs to be aware of possible future consumer tastes and make sure they are prepared to respond to changing customer needs.
Affect of change: needing to meet new legal requirements
Needing to update business practices to meet new: health and safety, data protection, consumer protection and employment laws.
Affect of change: needing to retrain the workforce
In order to have smooth adaption to new circumstances, new ways of working will need to be introduced, and also needing training on how to use new technology.
Affect of change: needing to look for new markets
Need to target new segments of the market or expand internationally to find new customers, products may have a shorter life cycle due to changes in consumer taste.
Change management
Offers many benefits like a smooth transition, reduces resistance from stakeholders and allows the business to operate in the most efficient way
Key strategies to prepare for change
Employee preparation: reskilling, this will make a workforce more flexible and adaptable.
Increased research and development: can be used for preparation for change or to develop new products and technology
Additional capital investment: change can create the need for investment in new technology and new equipment
Stakeholder: Manager
Resistance: may be a result of lack of experience or expertise in how to run a business or the market
Stakeholder: Worker
Resistance: may be a result of them wishing to preserve existing routines, and protect pay/employment, and avoid threat to security and status
Stakeholder: supplier
Resistance: may be a result of reluctance to changes made by their customers, changes in systems (JIC,JIT) may break down relationships
Stakeholder: Shareholders/owners
Resistance: may be a result of the fear that changes to strategy may increase risk, which could mean failure or less dividends
Changes in organisational culture
Organisational culture consists of factors such as: the shared values of a business, the beliefs and norms that affect work life, the behaviours typical of day to day behaviour. These are usually deeply rooted in an organisation.
The role of leadership
Leadership qualities such as vision, determination, ambition, honesty, confidence etc are key to how employees will react to change. The different types are: autocratic, paternalistic, democratic,bureaucratic, and laissez faire
Indicators of how a business has adapted to change
Delivery times, production defects, customer satisfaction surveys, market share, sales turnover, profitability
Impact of change key points
Positive: upskilling of workers, more favourable working conditions
Negative: job losses, loss of income, temporary loss of profitability
