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2023/24 > BUSMANCHAP4 > Flashcards

BUSMANCHAP4 Flashcards

1
Q

internal factors

A

business has somewhat control over

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2
Q

external factors

A

they have no control over

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3
Q

Business change

A

adoption of a new idea or behaviour by a business to gain competitive advantage

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4
Q

Competitive advantage

A

selling goods and services at a lower cost price than the competition

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5
Q

pro active

A
  • change is planned n occurs before bus is affected by pressures in env

-more effective-allows bus to gain competitive adv

-allows bus to be prepared so it doesnt dramaticay impact bus

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6
Q

Reactive approach to change

A
  • after the business has been affected by the pressures in its environment
  • Less effective , as the business has already been affected by the change, which may have caused a loss in productivity or sales due to the failure to recognize that the change
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7
Q

Key Performance Indicators (or KPIs):

A

specific criteria used to measure the efficiency and effectiveness of a business’ performance.

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8
Q

Some typical KPIs:

A
  • Percentage of market share
  • Net profit figures
  • Rate of productivity growth
  • Number of sales
  • Rates of staff absenteeism
  • Level of staff turnover
  • Level of wastage
  • Number of customer complaints
  • Number of website hits
  • Number of workplace accidents
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9
Q

Percentage of Market Share (high)

A

a business’ share of the total sales of a particular product within an industry (versus their competitors’ shares)

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10
Q

Net Profit Figures (high)

A

what profit remains after all expenses have been subtracted from a business’ revenue, including taxes, interest and depreciation.

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11
Q

Rate of Productivity Growth:

A

compares changes to the above explanation from one year to the previous year (Has it grown? How much by?)

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12
Q

Productivity:

A

measure of efficiency indicating how many resources (inputs) it takes to produce an output (goods or services).

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13
Q

Number of Sales:

A

the amount of g&s a business sells in a given period of time.

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14
Q

Rate of Staff Absenteeism:

A

number of workers who do not turn up for work when they are scheduled to do so.

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15
Q

Level of Staff Turnover:

A

number of employees who are leaving the business over a period of time, and then need to be replaced by new employees.

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16
Q

Level of Wastage:

A

amount of unusable or unwanted material created by the production process.

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17
Q

Number of Customer Complaints:

A

number of customers who contact the business to express their disappointment with the business.

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18
Q

Number of Website Hits:

A

when a website, or files within a website, receive a visitor.

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19
Q

Number of Workplace Accidents:

A

any unplanned event that results in personal injury or property damage at the workplace that is reported to management.

20
Q

Lewin’s Force Field Analysis theory

A

outlines the process of determining which forces drive, and which forces resist, a proposed change.

21
Q

Driving forces -

A

forces that support a change and work to assist the business in achieving its goal.

22
Q

Restraining forces -

A

forces that work against a change.
They create resistance and hinder the achievement of the goal.

23
Q

driving forces

A
  • customers
    -legislation
    changes in tech
  • opportunities to enter new market
24
Q

restraining forces:

A
  • financial considerations
  • employee resistance
  • time
  • leg
  • org in
  • managers
25
Q

In Force Field Analysis theory

A

driving forces must be greater than the restraining forces or the change will not occur.

26
Q

How to perform a Force Field Analysis:

A
  1. weighting
  2. ranking
  3. implementing a response
  4. evaluating the response
27
Q

How to perform a Force Field Analysis:

  • weighting
A

Identify the driving and restraining forces and list them on either side of the proposed change or goal.
and give each a score of how strong or influential each force is

28
Q

How to perform a Force Field Analysis:

  • ranking
A

rank the top 3 to 5 most driving forces and the top 3 to 5 most restraining forces.

need to either strengthen or eliminate in order to allow the change to occur.

29
Q

How to perform a Force Field Analysis:

implementing a resonse

A

action plan to then list the actions that are needed to be completed to achieve the proposed change - assign responsibility for each action.

30
Q

How to perform a Force Field Analysis:

Evaluating the response

A

review and evaluate how successful the response has been.

31
Q

adv and dis of force field analysis

A

allows bus to dentify an strenghten driving forces supporting change and to take action to reduce or liminate restraining factors

timelines may be subjective and not consider unexpextd events

32
Q

driving forces for change

A

-innovation
-competitors
- reduction in costs
-employees

33
Q

restraining forces in business

A
  • managers
    -time
    -organisational inertia
  • employees
    -legislation
    -financial considerations
34
Q

Porter’s Generic Strategies

A

Responding to competition, a busimay want to gain its own competitive adv. Porter identified two categories

35
Q

Cost advantage - competitive advantage is

A

gained through reducing the costs of the business, allowing it to operate with larger profit margins compared to its market rivals.

36
Q

Differentiation advantage - competitive advantage is

A

gained through differentiating their good or service from others in the market.

37
Q

Lower Cost Strategies
- cost leadership

A

seeking to become the business with the lowest costs in the market.

38
Q

lower cost strat

strategies that a business could use to achieve lower cost include:

A

Reducing direct and indirect costs: reducing wages, cost of interest,
reducing cost of supplies/stock, Sourcing cheaper utility suppliers

Improving efficiency: minimising idle stock on shelves, using assets more efficiently

Controlling areas of management responsibility: checking and reviewing areas of the business n Implementing strategies at those levels to reduce costs.

39
Q

adv and dis of low cost strat

A

bus may save money on some costs to allow expansion or dev of new lines

sales may fall as customers may percieve a product as being poor quality

40
Q

Product differentiation -

A

uses factors such as brand names, delivery methods, and advertising to establish differences between substitutable products.

Making product different, unique, or superior in some way will give you the competitive edge and allow your business to market itself as a leader in that industry.

41
Q

Some strategies that a business could use to differentiate its product include:

A

High-quality products: ensuring quality is better than that of competitors, e.g. more durable, more reliable, providing better support, offering extended warranties

Multiple branding: providing different brands or more brands in the same market - providing similar products with very subtle differences that would appeal to different customers

Innovation/ Research and Development: developing a product with unique features that no other business currently produces - identifying a market that is not yet filled

42
Q

adv and dis of differentiation strat

A

by developing customer loyalty, market share can be increased

rival bus can copy differentiated approach, negating any gains

43
Q

(restraining factors) managers:

A
  • poorly timed
    -hasty decisions, unclear
  • lack experience n skills to overse transformation
44
Q

(restraining factors)
employees:

A

-worried they cannot adapt
-job losses

45
Q

driving:

owners and managers:

A
  • change to maintain sales profit market share
46
Q

restraining

legislation

A

-restricts certain things

47
Q

driving

globalisation

A

remain viable and competitive

2023/24 (65 decks)

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