Change Flashcards
What is change in a business sense?
Change is the process of implementing new ideas and philosophies into a business
Difference between internal and external causes of change.
Internal causes of change are changes which are either implemented within the business or happen inside its structure.
External change is change which occurs as a result of a change in factor outside of the businesses control e.g. government laws and regulations
Internal causes of change
New management
New machinery
Expansion
External causes of change
Social Factors e.g consumer buying habits/trends
Technological advances e.g new ways of producing/new machinery
Economic factors e.g state of the economy
Ethical factors e.g is the method of production or sources of commodities sustainable and ethical.
Political e.g does a political party oppose the market which your business is in.
Legal e.g do laws and regulations prevent your product from being produced.
Environmental e.g unsustainable products are likely outlawed.
Types of change
(Catastrophic
Crisis Business has no control over.
Contingency )
(Strategic
Tactical. Business has control over
Operational)
Reasons to implement change. (Drivers for change.)
Need for higher profits Poor efficiency Lack of innovation Need to change culture Change of leadership. Any of the STEEPLE Reasons
Reasons against implementing change. (Drivers against change.)
Employee resistance Workers unions Media coverage Political interference Self interest Misunderstanding Weak leadership
How should a business handle change effectively?
It is important to manage change well because if a business does not adapt to it well then it can cause business failure.
Techniques to help a business deal with change
Flowcharts Forecasting GANTT chart Kotters 8 step change model Lewins freeze and unfreeze model. McKinsey 7 - S’ model
Lewins change model
Unfreeze - Stop the business and introduce the ideas and the needs for change
Change - Implement the change which you need to, ensure that universally the business wants this change
Freeze - Make this change the new norm in the culture of the business, do this by reminding the employees of the benefits or the reasons for this new change
McKinseys 7 - S’ model
Structure - Style - Systems - Strategy - Superordinates goals - Skills - Staff
All of these factors are interlinked and are relevant to each other, changing one factor affects the other.
Kotters 8 step model
1.)Create urgency -> 2.)Form a powerful vision -> 3.)Create the vision for change -> 4.) Communicate the vision -> 5.) Empower action -> 6.) Create quick wins -> 7.) Build on the change -> 8.) Make it stick.
Why is leadership important during the change transition?
If there is a lack of strong leadership to guide a business through the period of change, the change can often become distorted and will be unsuccessful which could lead to further repercussions for the business.
