CHAPTER 6-External environment- Social and technological change

Question 1

What are demographic changes?

Answer 1

changes in the structure of the UK population over time in terms of things like age, sex and race

Question 2

how can demographic changes influence business decision making?

Answer 2

• More working parents will boost the workforce but businesses need to provide more flexible contracts
• Increase in people living alone will lead to a demand for smaller houses and food packaged in smaller amounts

Question 3

how can a change in consumer lifestyle and buying behavior affect businesses?

Answer 3

• rise in social networks means that it becomes a important tool of promotion
• People are to busy to wait for delivery so want to collect it from a safe place eg. petrol station

Question 4

What is urbanization?

Answer 4

an increase in the proportion of people living in cities

Question 5

what opportunities does urbanization offer businesses?

Answer 5

• Demand for services in the area

- demand for infrastructure, housing and communication

Question 6

how can migration help a business?

Answer 6

can help some businesses overcome labor shortages and allow them to expand into new and current markets

Question 7

what happens when too many skilled people leave a country or region?

Answer 7

Brain Drain

Question 8

what is Corporate Social Responsibility?

Answer 8

the idea that a company should go above and beyond what is required of them by law to help society, its workforce and the environment

Question 9

what might happen if companies don’t act responsibly

Answer 9

• consumers may boycott there products

- there reputation may be affected

Question 10

what are some of the advantages to CSR?

Answer 10

• Competitive advantage (USP)
• Improves brand loyalty
• attracts new customers through good publicity
• attracts more talented applicants because people prefer to work for a business that has a good CSR record
• higher employee morale so reduced staff turnover

Question 11

What are the disadvantages of CSR?

Answer 11

• Expensive and shareholders may think it is a misuse of funds
• Costs may be passed on to customers and if there is recession and prices are sensitive then sales will fall
• Small businesses may not have funds to spare for csr projects
• May be hard to monitor adherence to ethical behavior

Question 12

give an example of bad CSR by a business?

Answer 12

Starbucks tried to avoid paying corporate tax by finding loopholes in the system but public protests have led to them volunteering to pay a meaningful amount of tax

Question 13

what is carrolls pyramid of CSR

Answer 13

a model showing what society expects from a business

Question 14

what are the four stages of Carrolls pyramid of CSR

Answer 14

• economic responsibilities
• legal responsibilities
• Ethical responsibilities
• Philanthropic responsibilities

Question 15

Can a business fulfill the other responsibilities before fulfilling the economic responsibilities?

Answer 15

no

Question 16

what are the two stages of Carrolls Pyramid of CSR which are voluntary?

Answer 16

Ethical and philanthropic

Question 17

what does philanthropic mean?

Answer 17

to be a good corporate citizen and contribute to the improvement of lives

Question 18

what are the internal pressures for social and environmental responsibility

Answer 18

-Business leaders: change will happen if they are concerned about sustainability and how to work in the most efficient way
-Shareholders: Long term view wants it to be socially and ethically responsible but short term view prefer quick profits
Employees: if the business is dependent on people who stay at the business for a long time then CSR needs to be addressed

Question 19

what are the external pressures on a business?

Answer 19

• Legislation: Businesses want to operate within the law because they have a reputation to protect
• Pressure groups:Greenpeace may put pressure on firms that are not being environmentally caring

Question 20

what are the benefits of technological change?

Answer 20

• Improved efficiency and reduced waste
• Better products and services
• New products and materials
• Advances in communication
• Improved working environment because machines can do the dangerous jobs

Question 21

What are the problems with technological change?

Answer 21

• Cost because need to replace old tech with new
• Knowing what to buy and when
• Industrial relations between employers and employees because change can be resisted

Question 22

what are the issues to consider when introducing new tech into a firm?

Answer 22

• Existing tech: is it compatible with current tech in the business
• Reaction of the workforce
• Potential short term difficulties (possible cutbacks in production while old tech is being replaced)
• Finance (high upfront costs)

Question 23

what is migration?

Answer 23

the permanent movement of people from one region to another

Question 24

what is technological change?

Answer 24

adapting new applications of practical or mechanical sciences to industry and commerce

Question 25

give an example of a business which has been involved with CSR significantly?

Answer 25

starbucks

Question 26

how has starbucks been involved with csr?

Answer 26

• since 1998 starbucks has supported the international conservation coffee programme resulting in a 60 percent price premium being paid to farmers and a 220 percent increase in the coffee growing land
• Employee benefits which are unusually in the industry

Question 27

how has tescos embraced technological change?

Answer 27

investments in barcode tech

Question 28

how has barcode tech helped to improve efficiency at tesco’s?

Answer 28

Barcodes are scanned at checkouts and by staff which captures the in stire product data
when a product need to be replenished then a message is sent to the warehouse for a delivery of that product
- thus by keeping minimum stock on the shelves it frees up shelf space allowing tescos to expand its range of non food items