CHAPTER 1 - Change Flashcards
Major causes of rapid change (7)
- Introduction of new technology
- Changes in competition
- Changing consumer tastes
- New legislation
- Labour market changes
- Changes in economic conditions
- Change in business ownership
Internal causes of change (4)
Changes in management style
Change in business ownership
Change in business size
Introduction of new technology
External causes of change (6)
Introduction of new technology Labour market Changes in economic conditions Competition Change in consumer tastes New legislation
Planned change (3)
created internally
structured and timetabled.
Clear objectives for the change are established
For example, a cycle manufacturer may decide to offer a new range of electric bikes
Unplanned change (3)
occurs in response to a shock to the business
unstructured and under-resourced.
created externally
e.g. COVID-19
Effects of change (7)
Shorter product life cycles
Diminished brand loyalty
New products need to be developed
Production methods will need to be changed
Retraining the workforce
Flexible workforce
The need to comply with constantly changing legislation
Effective change management (3)
- Employee preparation
- Increased research and development expenditure
- Additional capital investment
Storey’s Four Methods of Implementing Change
Negotiated Total Package
Negotiated Piecemeal Initiatives
Imposed Piecemeal Initiatives
Imposed Total Package
Resistance to change in business (3)
Worker resistance
Supplier resistance
Owner resistance
Worker resistance
businesses have tried to install new technologies or systems of working without considering how the people who actually do the work feel about the changes.
Failure to address questions can result in an expensive failure
e.g lost productivity or damage,sabotage and organised industrial action.
managers should:
• whenever possible involve workers from the beginning
• clearly explain the reasons for the change
• have a clear strategy, direction and vision
Supplier resistance
Suppliers may be reluctant to adapt to changes made by their customers
e. g. manufacturers who change to a Just in time (JIT) system may find that some of their suppliers resist having to supply components ‘as and when’ the manufacturer requires.
- increase in costs as deliveries need to increase in frequency.
smaller suppliers may have no choice but to accept the situation or lose a valuable customer.
Manufacturers should involve their suppliers from the outset,
Owner resistance
Owners may fear that change will increase risk.
Shareholders may need convincing that operating in new markets will not damage their dividends.
especially as implementing change may be costly and may involve investment.
Management will need to explain their plans to the shareholders carefully to convince them that sacrifice now will lead to better profit in the future.
Lewin’s three step process of change
- Unfreezing
- Change or Transition
- Refreezing
Organisational culture and change
Culture change must begin at the top of an organisation.
e. g. senior management of a business wishing to change its culture from being product-oriented to market-oriented.
- must have a very clear idea of how they expect the business to change.
- Leaders must put in place new methods of working which are backed up by training.
- must effectively communicate to all staff the reasons for such a change in approach in order that everyone understands why the change is necessary.
Evaluating change (6)
examine a number of performance indicators in order to establish if its objectives have been achieved.
Possible indicators may include: • Delivery times • Production defects • Customer satisfaction surveys • Market share • Sales turnover • Profit – ‘the bottom line’
