Impact On Internal Environment Flashcards
Impact on internal environment
When an organisation responds to the forces for change it can have an impact on the internal environment. Areas that are often impacted include the organisational structure, changes in corporate culture, human resource management and operations.
3 structural changes
Flatter structures
Outsourcing
Work Teams
Flatter structures
Some middle management positions are abolished and the frontline receives greater responsibility. This often occurs when a business makes changes due to poor financial performance.
Outsourcing
Outsourcing many of the non-core projects to contractors. This helps keep costs to a minimum and creates greater flexibility. Often occurs when a business makes changes due to poor financial performance.
Work teams
Linked with flatter structures, teamwork allows organisations to be more flexible and responsive. This helps keep motivation high and can generate more productivity. Often done when the business change involves making the entire organisation more responsive to change.
Corporate culture
Changes that occur should be reflected in the corporate culture. Getting all people within the organisation to share the new values and beliefs is important to the long term success of the change. For example when Telecommunications became deregulated and Telstra faced competition they had to change their culture to be more customer focused so that customers would chose Telstra over competitors.
Human Resource Management
Changes that are implemented may change elements in the HRM function. Employees may need to be trained differently to implement the changes. Positions that no longer exist need to be terminated and recruitment and selection may need to be changed so that the business employs new employees who have the skills required to implement the new changes.
Operations
Reducing production costs and improving productivity can result in changes within the operations function. There may be a need for new layouts to improve productivity. The changes may place a new emphasis on quality meaning the quality control procedures may need to be updated. Smaller more flexible facilities may be required if the change requires decreased costs, less use of that operation or allowing the organisation to be more responsive to change. There may also be changes in production schedules if the change involves decreased usage of that operation.
Evaluate the possible impact of change in the operations management or human resource management functions of an organisation.
Change can have a large impact on human resource management. It may require updating recruitment policies. At Australia Post when dealing with the change issue of technological development they had to change their recruitment policies to try and find new recruits who had the skills to implement technology as Australia post wanted to implement a securepay and my post system.
Change can also have a large impact on termination. Many changes made by business’s result in a loss of jobs for employees. At Australia post, as they were moving focus away from the letters business they had to make many employees redundant as they no longer needed a large number of postmen/women.
The changes implemented at Australia Post were quite successful, the new employees were able to successfully implement the securepay and my post stems while the terminated employees from the letters department helped to move focus to a technological future. These changes led to profits rising significantly after the implementation of these changes.
