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business management > Chapter 5 > Flashcards

Chapter 5 Flashcards

1
Q

Leadership in change management

A

is the ability to positively influence and motivate employees towards achieving business objectives during transformation.

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2
Q

To demonstrate strong leadership in change management, managers need to:

A

• Build a shared vision by informing employees of the reasons and benefits of change, as well as the consequences of not changing.
• Provide ongoing communication with clear instructions to employees as they move from current to new practices.
• Provide ongoing support including employee counselling, training, and consultation.

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3
Q

Staff training

A

is a business equipping employees with the knowledge and skills required to perform work tasks

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4
Q

Staff motivation

A

is managers implementing strategies that seek to drive employees to work towards the achievement of business objectives.

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5
Q

Change in management styles or skills

A

is managers altering their way of directing and interacting with staff

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6
Q

Increased investment in technology

A

is the implementation of automated and computerised processes for production and operations

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7
Q

Improving quality in production

A

is the implementation of processes that increase the perceived value of a product or service.

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8
Q

Initiating lean production techniques (or lean management)

A

is adopting approaches that reduce waste in production while increasing the value of goods to the customer.

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9
Q

Cost-cutting

A

is the process of reducing business expenses

A business can cut costs by:
• merging staff roles to reduce the number of employees required.
• shutting down business locations that do not add significant value.
• stopping the production of goods with high amounts of unsold stock

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10
Q

Redeployment of resources

A

is the reallocation of natural, labour and capital materials to different areas of the business to improve their effectiveness and productivity

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11
Q

Labour resources

A

are the mental and physical abilities of workers that can be used to produce goods and services. Types of labour resources can include production line workers, data analysts and human resource employees.

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12
Q

Capital resources

A

are man-made goods used in the production of final goods and services. These may include, machinery, vehicles or tools.

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13
Q

Natural resources

A

are raw materials that are used in the production of goods and services. These include resources such as land, water or coal.

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14
Q

new locations

A

A business can build new business opportunities by opening new branches or outlets in new locations

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15
Q

The advantages and disadvantages of expanding to new locations

A

ADVANTAGES
• Creates a physical presence in new geographical locations which can improve the business’s reputation and brand image.
• Seasonal products can be sold during the opposing season in the northern hemisphere. For example, beach fashion can be sold in America during Australia’s winter
• Increased sales and profit from new markets.

DISADVANTAGES
• Higher business uncertainty due to unstable political, social or economic conditions in other countries
• Poor communication and language barriers may lead to multiple delays
• Increased rental, utility costs as well as salaries of employees of branches or outlets

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16
Q

online sales

A

A business can potentially increase their domestic and global sales by selling their products online

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17
Q

The advantages and disadvantages of online sales.

A

ADVANTAGES
• Seasonal products can be sold during the opposing season in the northern hemisphere countries
• Improved job opportunities for employees to operate and maintain an online sales platform
• Accesses a large number of customers in a very short amount of time.

DISADVANTAGES
• Product may be lost or damaged during delivery.
• Will have to be trained to operate an online sales platform.
• Can be costly implementing a new distribution network for online sales.

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18
Q

differentiation

A

A business can gain new business opportunities domestically by differentiating their products or services.

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19
Q

The advantages and disadvantages of differentiation

A

ADVANTAGES
• Customers are often loyal to the business brand because of unique features or services not offered by competitors.
• Employees may feel an increased sense of pride working for a differentiated business. This can motivate employees to be more
productive and effective
• Increase in sales revenue because of niche markets or customers switching from competitors.

DISADVANTAGES
• Can be difficult to prevent competitors from replicating point of differentiation.
• Higher investments of time towards research to develop innovative products or improve service levels of employees.
• Will incur research and development costs as well as legal fees to protect innovations.

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20
Q

Exporting

A

is a specific method a business can use to grow globally. Instead of opening new overseas locations, the goods or services can be sold through local distributors and retailers

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21
Q

The advantages and disadvantages of exporting

A

ADVANTAGES
• Creates a brand presence in new geographical locations which can improve the business’s reputation and brand image.
• Avoids the cost of setting up new stores.
• Increased sales and profit from new markets.

DISADVANTAGES
• Product or services may need to be modified to suit overseas cultural preferences or legal requirements.
• May need to be trained in new skills or knowledge to adapt to exporting requirements.
• Certain types of products may be affected during long transport times to overseas locations.

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22
Q

A learning organisation

A

is a business that facilitates the growth of its members and continuously transforms itself to adapt to changing environments.

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23
Q

Systems thinking

A

is the ability to understand the interrelationships between different areas of a business.

24
Q

Mental models

A

is challenging the pre-existing assumptions and beliefs that people have about a business and its practices.

25
Q

A shared vision

A

is an aspirational description of what a business and its members would like to achieve.

26
Q

Personal mastery

A

is encouraging individual development and learning through business activities.

27
Q

Team learning

A

encourages individuals to combine their strengths and abilities to continuously grow together.

28
Q

Low-risk strategies

A

are gradual management approaches that encourage employees to accept and participate in a business change.

29
Q

Communication as a low-risk strategy

A

is managers initiating open and honest two-way communication with employees so they are fully aware of the reasons, impacts and their roles in an upcoming change

30
Q

Empowerment as a low-risk strategy

A

is managers providing employees with increased responsibility and authority during times of change.

31
Q

Support as a low-risk strategy

A

is providing employees with assistance as they move from current to new practices.

32
Q

Incentives as a low-risk strategy

A

is managers providing financial or non-financial rewards to encourage employees to support change

33
Q

Advantages and disadvantages of low-risk strategies

A

ADVANTAGES
• Communication, empowerment and support all have a higher chance of change being successful in the long-term due to increased trust and cohesion between managers and employees.
• Support and communication can effectively reduce employee’s fear and stress levels related to change.
• Employees embracing the change will likely result in an increase in revenue or decrease in costs

DISADVANTAGES
• Empowerment may result in tasks being carried out in a way that management did not intend.
• All strategies are not useful in crisis situations as they take time to be effective.
• Incentives can involve financial expenses for the business.

34
Q

High-risk strategies

A

are autocratic management approaches used to influence employees to quickly accept and follow a business change

35
Q

Manipulation as a high-risk strategy

A

is influencing employees to follow a proposed change by providing incomplete and deceptive information about the proposed change.

36
Q

Threat as a high-risk strategy

A

is forcing employees to follow a proposed change by stating that they may or will cause harm to them if they fail to follow the change.

37
Q

Advantages and disadvantages of high-risk strategies

A

ADVANTAGES
• Ensures change is implemented how the manager desires as there is no employee input.
• High-risk strategies are useful in crisis situations where change must occur rapidly
• High-risk strategies involves little financial costs to initially implement.

DISADVANTAGES
• May lead to negative corporate culture in the future where there is long term distrust.
• Relationship between management and employees is compromised.
• May feel fearful of losing their job and feel as if they will be easily replaced

38
Q

The unfreeze step

A

moves a business to a state where stakeholders are prepared to undergo change.

During this stage, a manager should identify why change is necessary and what needs to be changed. A manager should then deliver compelling messages to stakeholders highlighting the reasons for and benefits of the change

39
Q

The change step

A

moves the business towards the desired state.

During this stage, employees will usually have high levels of fear and confusion related to the change. To counter these high levels of fear and confusion, management should provide ongoing support and training to employees.

40
Q

The refreeze step

A

ensures the change is sustained within the business for the long term

During this stage, managers should introduce new policies and job descriptions to establish the new culture which aligns with the change. Management should also constantly evaluate the change during this stage to ensure that the business is performing as desired.

41
Q

Lewin’s three step change model

A

is a process which can be used by a business to implement successful change

42
Q

Effect of change on managers

A

Managers can be in charge of the entire business or an area of management. Accordingly, managers coordinate employees and various business activities to ensure objectives are achieved. To effectively achieve these objectives, managers are often required to lead business change. In these situations, managers can be affected in many ways.

43
Q

 Positive and negative effects of change on managers

A

POSITIVE
-Opportunities to develop new skills or advance careers may be created by change.
-Financial or non-financial rewards provided if business change is successful.
-Increased authority and responsibility can improve a manager’s skills.

NEGATIVE
-Increased workloads can lead to stress which may impact a manager’s wellbeing.
-Loss of job and financial security if business change is unsuccessful.
-Reduced roles and responsibilities may lead to less authority and control

44
Q

Positive and negative effects of change on employees

A

Positive effects
- New opportunities and responsibilities can improve employee job satisfaction.
- May build long term job security and improve employee satisfaction if business change is successful.
- Better employment conditions or rewards can be provided if business change is successful.

Negative effects
- May need to develop new complex skills and knowledge to keep their job which can increase stress levels.
- May lose their job and financial security due to the change.

45
Q

Effect of change on employees

A

Employees are individuals who work for a business by completing allocated tasks. Often, employees are the stakeholders who are most affected by the change. In situations of business change, employees can be affected in many ways.

46
Q

Effect of change on customers

A

Customers are people who purchase goods or services from a business. These goods or services can be affected by a business changing to achieve their objectives. In these situations, customers can be affected in many ways

47
Q

Positive and negative effects of change on customers

A

Positive effects
- Better product or service quality can increase customer satisfaction.
- Reduction in the price of goods or services sold can increase customer satisfaction.
- The practice of CSR may increase customer satisfaction.

Negative effects
- Lowering quality to save on costs of production may frustrate customers and reduce satisfaction.
- Increasing the price of goods or services may frustrate customers and reduce satisfaction.
- Discontinuing or changing a good or service may decrease customer satisfaction especially if it fails to meet their needs.

48
Q

Effect of change on suppliers

A

Suppliers sell raw materials and resources to other businesses for their production. However, businesses may alter their production processes for various reasons. In these situations, suppliers can be affected in many ways.

49
Q

Positive and negative effects of change on suppliers

A

Positive effects
- May increase the amount of resources demanded by businesses which can increase sales for a supplier.

Negative effects
- May decrease sales if businesses decide to switch to a different supplier or lower their volume of orders.
- May require adjustments in processes and supplies offered to meet the requirements of a business change.

50
Q

Effect of change on the general community

A

The general community is made up of individuals and groups who do not directly interact with the business. The general community is indirectly impacted by business activities particularly during the implementation of change. In these situations, the general community can be affected in many ways.

51
Q

Positive and negative effects of change on the general community

A

Positive effects
- Creation of more jobs can increase employment rates and improve societys well being
- Increases customer traffic and sales of surrounding businesses if change involves opening or expanding into new areas.
- Greater ability to make donations to charity and contribute to social causes if business change is successful.

Negative effects
- Loss of jobs may increase unemployment rates and decrease society’s well being as poverty levels will rise.
- Decreases customer traffic and sales of surrounding businesses if change involves a shutdown or relocation.

52
Q

 CSR considerations for the general community during change

A

The change CSR consideration
Change in suppliers. • Choosing local suppliers to create opportunities and
employment improve the local
economy.

Introduction of new • Redeploying
technology which employees to other
replaces human labour. areas of the business
to minimise
unemployment rates.

Global sourcing of • Sourcing materials
materials. from businesses that
provide employees
with fair pay and
working conditions.

53
Q

CSR considerations for the environment during change.

A

The change CSR consideration
Introduction of new technology. • Purchasing accurate technology which
reduces the number of errors that occur
during production can minimise the
business’s amount of waste.

Change of suppliers. • Choosing a local supplier to reduce the
amount of carbon emissions produced
during transportation.

Building a new facility. • Building a facility which creates minimal
pollution during construction and has a
minimal impact on local wildlife.

54
Q

 The advantages and disadvantages of CSR considerations.

A

ADVANTAGES
• Can develop a good brand reputation which leads to more customers purchasing goods or services
• Employees usually prefer to work for businesses who have ethical practices.
• Customers are willing to pay more for ethically produced goods or services.

DISADVANTAGES
• A constant focus on CSR may decrease productivity levels
• It can be time-consuming to address various CSR considerations.
• CSR practices can be expensive for a business to implement.

55
Q

Reviewing KPIs to evaluate the effectiveness of business transformation

A

It is important for a business to review performance following a change. Reviewing key performance indicators can identify whether a business change has achieved its desired objectives or if further changes are required. From a review of KPIs, a business may even discover that the change has achieved its objectives but unintentionally affected other areas negatively

business management (9 decks)

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