3.6.1 Causes and effects of change Flashcards
What is change management?`
Change management involves the process that ensures a business responds to the environment (internal/external) in which it operates.
What are the approaches to change?``
1) Step change
2) Incremenetal change
What is step change?
Significant changes that happen rapidly.
What is step change also known as?
Business process reengeering
What are the incremental changes?
- a method of Kaizen where change occurs over a period of time in incremental small stages
What are the positives and negatives of incremental changes?
+ staff input, gradual
- time, demoralising
What can happen internally that causes change?
- toxic culture (industrial relations)
- internal politics and other diseconomies of scale
- change in the production process
- poor financial stability
- poor return on investment
- changed organisation structure (downsizing)
- transformational leadership
What is a transformation leader?
A leader who transforms a but they work for
What can happen externally that causes change?
- environmental changes
- political change
- BREXIT
- NGOs involvement, pressure groups
- civil unrest
- scarcity
- location
- infrastructure
- ethics
- competitors (new products, takeovers)
- consumer trends e.g. m/e/s commerce
- disruptive technology
- demographic change
What is a sharing/gig economy?
earning income from own assets e.g. Uber
What must companies do with change?
Change is a key feature, it must be foreseen by a company and planned for.
What stakeholders are against change?
Businesspeople
What stakeholders are for change?
consumers
What are the positives of change?
+ keep ahead of the competition
+ keep up with customer demands
+ stuck in traditions
What are the negatives of change?
- may change the traditions and values of a business, impacting customer loyalty
- some markets change little
