Driving Forces for Change in a Business Flashcards
What is a driving force?
motivations or reasons that encourage business change
What are the 10 Driving Forces for Business Change?
Innovation
Societal Attitudes
Managers
Employees
Competitors
Legislation
Pursuit of Profit
Reduction of Costs
Globalisation
Technology
What is a managers responsibility in driving forces?
operating profitable/successful business
responsible for finances, improving business, and taking care of shareholders/stakeholders
key driving forces for change
What is an employees responsibility in driving forces?
employees want good pay and working conditions in exchange for their contribution
key driving/restraining force for business
What is the role of competitors in driving forces?
opening of new business can cause other businesses to implement change to stay relevant
price matching or lowering makes customers happy and boosts competitive advantage
involving new technology can drive competition to change production/products
developing online presence through ads and sales can also drive competition to change strategies
What is legislation?
laws can be passed that require businesses to make changes
businesses must comply or face serious consequences (e.g. Covid, banning indoor smoking)
What is pursuit of profit?
businesses want to make profit to sustain a living, please shareholders, and keep business running so that is a driving force
if business profit isn’t enough they will have to make changes
what are strategies to help reduction of costs in driving forces?
source inputs from cheaper suppliers (overseas, local)
source local suppliers to eliminate import fees
reduce wages through downsizing or switching to technology
source new utility supplier so save money
What is globalisation in driving forces?
moving business overseas to expand market share, use cheap labour, with no trade barriers
global market means bigger competition, keeping businesses constantly changing to stay relevant
What does technology do in driving forces?
tech allows businesses to operate for efficiently and effectively, improves productivity and cuts costs
implementing tech drives business change
Why is innovation good for business change?
innovation is driven by technological and global advances
niche markets can also support innovation and business change
What do societal attitudes do in driving forces?
society’s attitudes and values are always changing, causing businesses to change with it
society requires businesses to be ethical, sell good products and treat staff well otherwise their performance can be compromised
