3.7.6

Question 1

what is social change

Answer 1

Social change relates to the changing demands of society for different goods and services. It also includes the way society spends money (such as increased spending on luxury products) and accesses products and services

Question 2

what is demography

Answer 2

the study of the human population (such as profiling postcodes by the demographic make-up of its residents). These create new changes and opportunities for businesses.

Question 3

key demographic factors

Answer 3

age - getting older increase demand in ‘grey’ market
growth - growing populations increase demand for products and services
urbanisation - developed countries of people moving from rural areas to towns and cities
migration - growing proportion of the UK and EU are migrants

Question 4

key lifestyle changes

Answer 4

technology
single occupancy
on-demand culture
luxuries
time
health and well-being

Question 5

technology

Answer 5

consumers are increasingly using technology to access products and services, such as growth in online shopping and consuming services via mobile devices.

Question 6

single occupancy

Answer 6

more people are living on their own than ever before.

Question 7

time

Answer 7

in a busy world,
consumers’ time is precious.
Consumers want products and services that save time.

Question 8

on-demand culture

Answer 8

consumers are accessing products and services instantly or when it suits them, including TV and online shopping.

Question 9

luxuries

Answer 9

people spend a greater proportion of their income on luxury items.

Question 10

health and well-being

Answer 10

consumers are more health conscious than they have ever been.

Question 11

developments in technology

Answer 11

create opportunities for new products and services, but also advancements in the way in which businesses produce products and deliver them to the consumer.
Technology can completely reshape a market (for example Uber) and businesses can be left behind if they don’t keep up with technological advances (for example Kodak).

Question 12

online businesses

Answer 12

bandwidth speeds have increased along with the sophistication of e-commerce websites and the security of online payments.

Question 13

opportunities of online business

Answer 13

Opportunities for small business start-ups - little capital is required to start up an online business.
Cutting out retail - online businesses offer lower prices for consumers, but this can cause retailers to close and add to the declining state of the UK’s high streets.
Access to a global market - the internet allows businesses to reach a global market.
Growth of direct delivery - online businesses require fast and effective delivery services to get products to their customers.

Question 14

downside to e-commerce

Answer 14

Fraud - a considerable amount of business fraud takes place through bogus ecommerce sites, costing businesses and consumers millions of pounds each year.

Question 15

A number of advancements in technology are changing the way businesses operate and will create a number of opportunities in the future.
Some of these emerging technologies include:

Answer 15

3D printing
wearable technology smartphone/mobile technology
renewable energies
virtual reality
the ‘internet of me’ (personalisation) of online experience
cloud computing.

Question 16

Technological advancements create many opportunities for business in terms of:

Answer 16

innovating products
access to new markets improving internal efficiencies streamlining operations.

Question 17

However, technological advancement can also be a risk for businesses:

Answer 17

At times, technological advancement can become a threshold resource that businesses have to keep up with if they are to remain in a market and compete.
New technologies also make some products and services
obsolete

Question 18

strategic decisions - social and tech change

Answer 18

Constant social and technological change means business models cannot stay static. The strategic direction of businesses will shift to meet these needs, and businesses will have to develop different core competencies. As the needs of society change, businesses will inevitably have to change their position in the market.

Question 19

marketing - social and tech change

Answer 19

As society changes market research must keep up with these trends to ensure the business understands the needs of its customers. Technology also gives a business new ways of communicating and interacting with its customers.

Question 20

finance - social and tech change

Answer 20

As technology grows exponentially businesses must think very carefully about where they want to invest their money.
Online retail also offers businesses the opportunity to reduce their investment in expensive capital such as retail premises.

Question 21

operations - social and tech change

Answer 21

The growing trend for instant access to products and
services means businesses have to find ways to get their products to customers in a faster, more efficient and simple way.

Question 22

Human Resources - social and tech change

Answer 22

Flexible working conditions mean employees no longer need to operate from a single place of work. Human resources face the challenge of managing this and the impact nomadic working can have on teamwork and motivation.

Question 23

what is CSR

Answer 23

is the belief that a business should act responsibly and protect the interests of all its stakeholders.

Question 24

Going beyond following rules and regulations, CSR dictates that a business

Answer 24

should operate in a way that actually benefits society and the environment, not just to behave as a good citizen’ but for the long-term sustainability and prosperity of the business. CSR shapes the ethics that guide most modern-day businesses.

Question 25

customers - CSR

Answer 25

fair prices
transparency
honesty
reliable after-sales service
safe products

Question 26

employees - CSR

Answer 26

fair pay
good working conditions
job security

Question 27

suppliers - CSR

Answer 27

fair prices
frequent and regular orders

Question 28

local community - CSR

Answer 28

employment opportunities investment in infrastructure minimal negative externalities

Question 29

shareholder concept

Answer 29

the belief that a business’s prime function should be to satisfy its shareholders. This means maximising profitability. Profits will support the long-term success of the business and economic prosperity.

Question 30

stakeholder concept

Answer 30

where businesses cater for the needs of all stakeholders, not just shareholders. In doing so businesses create long-term prosperity and avoid unsustainable business practices.

Question 31

enlightened shareholder value

Answer 31

ESV involves focusing on shareholder value with a long-term perspective, not just for short-term profitability gains. As businesses adopt a long-term perspective, consideration of other stakeholders becomes more agreeable

Question 32

what is Carrolls CSR pyramid

Answer 32

This business model sets out four responsibilities that all businesses should meet in order to be socially responsible. The responsibilities are hierarchical, with economic responsibility at the base. Without first meeting this responsibility a business will fail and will therefore be unable to meet its other responsibilities.

Question 33

problem with CSR

Answer 33

There is sometimes a short-term contradiction between the first step of the pyramid and the following three. The pressures for a business to be legally, ethically and philanthropically responsible can require significant financial investment, therefore, having an impact on short-term profitability.

Question 34

philanthropic

Answer 34

Be a good corporate citizen.
Contribute resources to the community; improve quality of life.

Question 35

ethical

Answer 35

Be ethical.
Obligation to do what is right, just and fair. Avoid harm.

Question 36

legal

Answer 36

Obey the law.
Law is society’s codification of right and wrong. Play by the rules of the game.

Question 37

economic

Answer 37

Be profitable.
The foundation upon which all others rest.

Question 38

Appropriate CSR practices can have a significant impact on the competitiveness of a business:

Answer 38

• Bad publicity can be shared easily through social media, damaging its reputation.
• Ethically orientated customers may choose a business based on its CSR record.
• Good CSR will help attract the best employees.
• Supporting developing countries through effective CSR policies supports long-term sustainability and growth in these markets.