unit 4 aos 2

Question 1

what is leadership in change management?
+ how do managers demonstrate it?

Answer 1

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

to do this, managers need to:
- build a shared vision
- provide ongoing communication
- provide ongoing support

employees who understand the reasons for change, have clear instructions, and feel supported or valued by a business are more likely to adopot changes

Question 2

list the management strategies to respond to KPIs

Answer 2

HR:
- staff training
- staff motivation
- changes in management styles or skills

OPERATIONS:
- increased investment in technology
- improving quality of production
- initiating lean production techniques

OTHER:
- cost cutting
- redeployment of resources

Question 3

describe staff training as a management strategy to respond to KPIs

which KPI’s does it affect and how?

Answer 3

equipping employees with the knowledge and skills required to perform work tasks. it can increase the quality, productivity, and safety of a business

KPIs:
number of customer complaints - decreased as the product / service quality is improved and customers are satisfied
number of workplace accidents - decreased as employees can better handle equipment and have safe working practises
number of sales - increased as employees have skills to communicate with customers the value of products
rate of productivity growth - increased as employees have increased efficiency and effectiveness

Question 4

describe staff motivation as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 4

implementing strategies that seek to drive employees to work towards achieving business objectives. they can be used when staff commitment is low and lead to employees being more productive and communicating with management

KPIs:
level of staff turnover - decreased as staff have a sense of achievement and value by the business
rates of staff absenteeism - decreased as employees have increased job satisfaction and are willing to perform tasks
number of customer complaints - decreased as employees are committed to improving quality of products
rate of productivity growth - increased as employees are willing to increase efficiency and effectiveness to achieve objectives

Question 5

describe change in management style or skills as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 5

managers altering their way of directing and interacting with staff. the complexity of tasks, employee experience, time, and manager preferences should be considered when adjusting

KPIs:
level of staff turnover - decreased as less restrictive styles promote employee involvement and make them feel valued
rates of staff absenteeism - decreased as less restrictive styles increase employees confidence in completing tasks
rate of productivity growth - increased as more restrictive styles promote employees staying on task
net profit figures - increased as more restrictive styles increase managers ability to manage waste, resources, and expenses efficiently

Question 6

describe increased investment in technology as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 6

the implementation of automated and computerised processes in production and operations. it can be used to respond to low performance and competitiveness in the market

KPIs:
number of sales - increased as APL, CAD and CAM improve consistent product quality and WD provides easier customer access to products
percentage of market share - increased (e.g. CAD allows customer involvement in the process)
rate of productivity growth - increased as efficiency and effectiveness in production is improved and WD allows businesses to anticipate customer demand
net profit figures - increased as labour costs are reduced and customer demand is met

Question 7

describe improving quality in production as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 7

the implementation of processes that increase the perceived value of a product or service. quality strategies can be implemented to improve customer satisfaction and productivity levels

KPIs:
number of customer complaints - decreased as goods are of higher quality, increasing customer satisfaction
number of sales - increased as satisfied customers return to purchase more
net profit figures - increased as sales increase from improved customer satisfaction
percentage of market share - increased due to increased sales from satisfied customers

Question 8

describe initiating lean production techniques as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 8

adopting approaches that reduce waste in production while increasing the value of goods to the customer. it can be used when productivity and business performance is low

KPIs:
level of wastage - decreased as there is not idle stock due to good being produced on customer order
percentage of market share - increased as the quality and nature of products caters to customers needs
rate of productivity growth - increased as inputs are used efficiently to produce greater quality outputs
net profit figures - increased as costs linked to excess inventory and inefficient production are reduced

Question 9

describe cost cutting as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 9

the process of reducing business expenses
it can be done by:
- merging staff roles to reduce 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
- sourcing materials from cheaper suppliers
- recycling materials used in the production process
- reducing employees wages (benefits, raises etc.)

KPIs:
net profit figures - increased as inefficiencies in the production process are reduces
levels of wastage - decreased as labour, time, and goods wasted are decreased
rate of productivity growth - increased as there is more productive use of labour and capital resources

Question 10

describe redeployment of resources as a management strategy to respond to KPIs

which KPIs does it affect and how?

Answer 10

the reallocation of natural, labour, and capital materials to different areas of the business to improve their efficiency and productivity
- redeployment of labour resources is transferring employees to other jobs within the business
- redeployment of capital resources is using money or other assets for a different purpose other than they were originally used for
- redeployment of natural resources is reusing and repurposing raw materials

KPIs:
net profit figures - increased as inefficiencies in the production process are reduces
levels of wastage - decreased as labour, time, and goods wasted are decreased
rate of productivity growth - increased as there is more productive use of labour and capital resources

Question 11

list the new business opportunities and state whether they are domestic, global, or both

Answer 11

• new locations (domestic + global)
• online sales (domestic + global)
• differentiation (domestic)
• exporting (global)

Question 12

describe new locations as a new business opportunity

Answer 12

opening new branches or outlets in new locations such as other suburbs, states, or countries

Question 13

list the advantages of new locations as a new business opportunity

Answer 13

• creates a physical presence in new places which can improve the business’ reputation and brand image
• seasonal products can be sold during off seasons
• further employees can be hired in new locations
• current employees can relocate to overseas countries
• increased sales and profit from new markets
• can be more cost effective to operate in certain countries because of cheaper labour or rent

Question 14

list the disadvantages of new locations as a new business opportunity

Answer 14

• can be difficult to understand and cater to a new market
• products or services may need to be modified to suit overseas cultural norms and preferences
• higher business uncertainty due to unstable political, social, or economic conditions in other countries
• delivery can be time consuming depending on where manufacturing occurs
• poor communication and language barriers may lead to multiple delays
• incurs cost for researching new markets and setting up stores
• increased rental and utility costs as well as employee salaries in new stores
• may encounter legal requirements and costs when exporting products to other countries

Question 15

describe online sales as a new business opportunity

Answer 15

selling products online, which means customers that do not live near a store or live near unavailable products are also able to purchase goods
customers are also able to enjoy the convenience of shopping from home anytime they want

Question 16

list the advantages of online sales as a new business opportunity

Answer 16

• accesses the entire global market without the need for physical expansion
• seasonal products can be sold during off seasons
• improved job opportunities for employees to operate and maintain an online sales platform
• IT staff, online technicians and online customer service staff have improved job security
• accesses a larger number of customers in a very short amount of time
• increases sales, profit, and market share

Question 17

list the disadvantages of online sales as a new business opportunity

Answer 17

• reduces face to face contact with customers
• products may be lost or damaged during delivery
• employees have to be trained to operate online sales platforms
• it may take weeks for an item to be delivered to overseas customers
• can be costly implementing a new distribution network for online sales

Question 18

describe differentiation as a new business opportunity

Answer 18

offering unique products or services that meet the demands of customers that are currently unmet or underserved
strategies could include:
- introducing technological improvements
- implementing innovations like new flavours
- improving sustainability where the product lasts longer
- advertising a brand image
- niche marketing

Question 19

list the advantages of differentiation as a new business opportunity

Answer 19

• customers are often loyal to the business because of unique features not offered by competitors
• employees may feel an increased sense of pride working for a differentiated business which can motivate them to become more productive and effective
• can charge premium prices as customers cannot purchase the product or service elsewhere
• increase in sales revenue because of niche marketing or customers switching from competitors

Question 20

list the disadvantages of differentiation as a new business opportunity

Answer 20

• can be difficult to prevent competitors from replicating points of differentiation
• new employees may require additional training to adapt their skills to match the point of difference
• higher investments of time towards research to develop innovative products or improve service levels of employees
• higher selling prices may deter some customers
• will incur research and development costs as well as legal fees to protect innovation

Question 21

describe exporting as a new business opportunity

Answer 21

sending goods and services overseas to be sold through local distributors and retailers rather than opening new overseas locations

Question 22

list the advantages of exporting as a new business opportunity

Answer 22

• creates a brand presence in new locations which can improve the business’ reputation and brand image
• access overseas markets with larger populations
• avoids the time taken to set up new stores
• avoids the cost of setting up new stores
• increased sales and profit from new markets

Question 23

list the disadvantages of exporting as a new business opportunity

Answer 23

• products or services need to be modified to suit overseas cultural preferences or legal requirements
• legal requirements may be different, requiring the product to be modified
• employees may need training in new skills or knowledge to adapt to exporting requirements
• certain types of products may be affected during long transport times to overseas locations
• there may be hidden costs in meeting export regulations such as tariffs and quotas
• necessary modifications and delivery costs may lower profit margins

Question 24

what is a learning organisation?

Answer 24

a business that facilitates the growth of it’s members and continuously transforms itself to adapt to changing environments

Question 25

outline senge’s learning organisation (include the five principles)

Answer 25

peter senge (senior lecturer at massachusets institute of technology) proposed the theory that becoming a learning organisation helps a buisness manage change more effectively
it promotes the adaptability of it’s members through the five principles:
- systems thinking
- mental models
- shared vision
- team learning
- personal mastery

*senge states that all five principles must be present for a business to be considered a learning organisation!!

Question 26

what is systems thinking as a principle in senge’s learning organisation?

Answer 26

the ability to understand the interrelationship between different areas of a business
- a manager analyses their business as a whole rather than seperate parts and understands how change in one areas may affect other areas of the business
- it also recognises that a business is connected to structures outside of it (such as their own industry or the wider economy), and therefore understands that changes outside the buisness can directly affect it internally

Question 27

what is mental models as a principle in senge’s learning organisation?

Answer 27

challenging the pre existing assumptions and beliefs that people have about a business and it’s practises
- these beliefs are usually held by many employees and can affect the entire business
- continuously challenging employees beliefs and breaking down existing mindsets to encourage employees to be more open to change can improve the business’ ability to implement change successfully

Question 28

what is shared vision as a principle in senge’s learning organisation?

Answer 28

an aspirational description of what a business and it’s members would like to achieve
- when a manager strongly and clearly communicates a vision, there is a unified focus provided for employees and their activities, in that they become motivated when a vision is promoted and subsequently align their efforts to achieve it

Question 29

what is personal mastery as a principle in senge’s learning organisation?

Answer 29

encouraging individual development and learning through business activities
- it can mean employees are commiteed to continuously developing themselves which may mean they take more initiative and responsibility in their work
- to facilitate it, a learning organisation should provide an environment that constantly promotes employees learning (e.g. opportunities to determine strengths and weaknesses)

Question 30

what is team learning as a principle in senge’s learning organisation?

Answer 30

encouraging individuals to combine their strengths and abilities to continuously grow together
- a manager should provide opportunities for employees to work as a team, which allows employees to combine their knowledge and skills to make more effective decisions on reaching business objectives
- people working together develop skills faster than they would individually

Question 31

what are the two kinds of strategies to overcome employee resistance during business change?

Answer 31

low risk and high risk

Question 32

describe low risk strategies to overcome employee resistance, and list the low risk strategies

Answer 32

gradual management approaches that encourage employees to accept and participate in a business change
- they create a supportive environment for employees during the change and assist them in understanding and accepting a change
- the honest and encouraging nature of these strategies reduce fear and anxiety and have a higher chance of success when overcoming employee resistance

• communication
• empowerment
• support
• incentives

Question 33

outline communication as a low risk strategy to overcome employee resistance

Answer 33

managers initiating open and honest two way communication with employees so they are fully aware of the reasons, impacts, and their role in an upcoming change
- employees are able to approach managers to clear questions or concerns, which builds trust when employees are well informed and without doubts

Question 34

outline empowerment as a low risk strategy to overcome employee resistance

Answer 34

managers providing employees with increased responsibility and authority during times of change
- employees have the power to contribute to change, making them feel directly involved and less likely to resist as they have a sense of ownership
- it can also indicate that managers have confidence in them, increasing their morale and motivation to implement a change

Question 35

outline support as a low risk strategy to overcome employee resistance

Answer 35

providing employees with assistance as they move from current to new practises
- managers can do this by providing assistance to employees such as: consultation, training, or counselling, to reduce fear or stress related to change and make them feel prepared to embrace the change

Question 36

outline incentives as a low risk strategy to overcome employee resistance

Answer 36

managers providing financial or non financial rewards to encourage employees to support change
- these may include bonuses, pay rises, and commissions (financial), or promotions or new responsibilities (non financial)
- employees will be less resistance if they are aware they will personally gain from the change

Question 37

list the advantages of using low risk strategies to overcome employee resistance to change

Answer 37

• 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 related to change
• incentives and empowerment can provide employees with opportunities to advance their career
• all strategies can make employees feel valued by the business

Question 38

list the disadvantages of using low risk strategies to overcome employee resistance to change

Answer 38

• empowerment may result in tasks being carried out in a way that management did not intend
• incentives could be seen as bribes if not executed properly
• all strategies are not useful in crisis situation as they take time to be effective
• incentives can involve financial expenses for the business

Question 39

describe high risk strategies to overcome employee resistance, and list the high risk strategies

Answer 39

autocratic management approaches used to influence employees to quickly reduce resistance to a change
- they are appropriate for making employees immediately follow necessary business activities, however are unsustainable in the long term due to their forceful and deceptive nature

• manipulation
• threat

Question 40

outline manipulation as a high risk strategy to overcome employee resistance

Answer 40

influencing employees to follow a proposed change by providing incomplete and deceptive information about the proposed change
- managers selectively present information to distort employee’s understanding of an upcoming change, which can influence employees to unknowingly agree with a change

Question 41

outline threat as a high risk strategy to overcome employee resistance

Answer 41

a business 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
- managers exploit employee’s fears by intimidating them by threatening their job security, financial security, or workplace safety
- e.g. dismissal, reduction of wages / hours, poor employer references, physical harm, loss of promotion

Question 42

list the advantages of using high risk strategies to overcome employee resistance to change

Answer 42

• ensures change is implemented how the manager desires as there is no employee input
• useful in crisis situations where change must occur rapidly
• involve little financial costs to initially implement

Question 43

list the disadvantages of using high risk strategies to overcome employee resistance to change

Answer 43

• may lead to negative corporate culture in the future where there is long term distrust
• relationship between management and employees is compromised
• employees may be fearful of losing their job and feel as if they will be easily replaced
• employees have low morale in the workplace and are more likely to leave or be absent from work
• usually only effective in the short term as employees are unlikely to follow change under such harsh conditions over long periods of time
• costs to replace employees may increase as these methods can increase staff turnover

Question 44

what is lewin’s three step change model?

Answer 44

a process which can be used by a business to implement successful change
it involves three steps which ensure that a business can implement change smoothly and successfully: unfreeze, change, and refreeze

Question 45

outline the unfreeze step in lewin’s three step change model and how it can be implemented

Answer 45

a business moves to a state where it’s stakeholders are prepared to undergo change
- challenging the beliefs, behaviours, and values that currently define a business
a manager should identify why change is necessary and what needs to be changed, then deliver compelling messages to stakeholders highlighting the reasons for and benefits of the change
(this stage should also provide stakeholders with an opportunity to raise concerns)
- once the stakeholders accept the change, transformations can proceed

Question 46

outline the change step in lewin’s three step change model and how it can be implemented

Answer 46

a business moves to it’s desired state by transforming practises to meet new objectives
employees will usually have high levels of fear or confusion related to the change, and managers should provide ongoing support and training to counter this as it will reduce stress arising and allow new practises to be adopted smoothly

Question 47

outline the refreeze step in lewin’s three step change model and how it can be implemented

Answer 47

ensures the change is sustained within the business for the long term and stops the business reverting to previous ways of operating
managers should embed the change into the business’ everday operations by establishing new policies and job descriptions for employees to establish the new culture which aligns with the change
managers should also constantly evaluate the success of the change to ensure the business is performing as desired

Question 48

list the stakeholders that a business change can have an effect on

Answer 48

• managers
• employees
• customers
• suppliers
• general community

Question 49

list the positive effects that a business change can have on managers

Answer 49

• opportunities to develop new skills or advance careers may be created by the change
• financial or non financial rewards are provided if the change is successful
• increased authority and responsibility can improve a managers skills

Question 50

list the negative effects that a business change can have on managers

Answer 50

• increased workloads can lead to stress which may impact a manager’s wellbeing
• loss of job and financial security if the change is unsuccessful
• reduced roles and responsibilities may lead to less authority and control

Question 51

list the positive effects that a business change can have on employees

Answer 51

• 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

Question 52

list the negative effects that a business change can have on employees

Answer 52

• may need to develop new complex skills and knowledge to keep their job which can lead to increased stress levels
• may lose their job and financial security due to the change

Question 53

list the positive effects that a business change can have on customers

Answer 53

• better product or service quality can increase customer satisfaction
• reduction in the price of goods or services sold can increase customer satisfaction
• the practise of CSR may increase customer satisfaction

Question 54

list the negative effects that a business change can have on customers

Answer 54

• 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

Question 55

list the positive effects that a business change can have on suppliers

Answer 55

• may increase the amount of resources demanded by businesses which can increase sales for a supplier

Question 56

list the negative effects that a business change can have on suppliers

Answer 56

• 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

Question 57

list the positive effects that a business change can have on the general community

Answer 57

• creation of more jobs can increase employment rates and improve society’s wellbeing
• increase customer traffic 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

Question 58

list the negative effects that a business change can have on the general community

Answer 58

• loss of jobs may increase unemployment rates and decrease society’s wellbeing as poverty levels will rise
• decreases customer traffic and sales of surrounding businesses if change involves a shutdown or relocation

Question 59

who should a business consider in terms of CSR when implementing a change?

Answer 59

• employees
• the general community
• the environment

Question 60

how could a business consider employees in terms of CSR when implementing a change?
give examples

Answer 60

managers can consider employees by promoting their wellbeing during period of change, and taking into account how change may impact their social and mental wellbeing
- business changes can lead to employees having their roles changes abruptly, losing their jobs, and wages, which leads to increased fear and stress at the prospect of disrupted jobs and financial security

examples:
(the change of downsizing, store closures, or introducing new technology leading to employee redundancies could mean businesses offer counselling for remaining staff, and outplacement services to help redundant staff find new employment)
(the change of introducing new equipment and machinery could mean businesses provide extra training and support when adapting)
(the change of reallocating labour resources could mean businesses communicate with employees to reduce misunderstandings or uncertainty)

Question 61

how could a business consider the general community in terms of CSR when implementing a change?

Answer 61

businesses can consider the general community by reducing or eliminating practises that are detrimental in society
- the general community can face low employment rates and as a result low economic activity, which can lead to increased crime and poverty, making it vital that businesses conduct their practises in a socially responsible and ethical manner to the general community keeps developing

examples:
(the change of suppliers could mean businesses choose local suppliers to create employment opportunities)
(the change of introducing new technology could mean businesses redeploy employees to other areas of the business to minimise unemployment)
(the change of global sourcing of materials could mean that businesses source materials from businesses that provide employees with fair pay and working conditions)

Question 62

how could a business consider the environment in terms of CSR when implementing a change?

Answer 62

businesses can consider the environment by reducing the negative impacts of their practises on the planet, which can result in serious and irreversible harm to the environment
- when businesses conduct their practises in an environmentally responsible way, their reputation will increase positively and customers and employees are more likely to want to buy from and work for a business

examples:
(the change of introducing new technology could mean businesses purchase accurate technology which reduces the number of errors that occur during production, minimising waste)
(the change of suppliers could mean businesses choose a local supplier to reduce carbon emissions from transportation)
(the change of building a new facility could mean businesses build a facility which creates minimal pollution during construction and has a minimal impact on local wildlife)

Question 63

list the advantages of using CSR considerations when implementing a business change

Answer 63

• business can develop of a good brand reputation which leads to more customers purchasing goods or services
• may attract highly skilled employees who value ethical conduct and are committed to meeting objectives
• employees usually prefer to work for businesses that have ethical practises
• customers are willing to pay more for ethically produced goods or services

Question 64

list the disadvantages of using CSR considerations when implementing a business change

Answer 64

• a constant focus on CSR may decrease productivity levels
• it can be time consuming to address various CSR considerations
• CSR practises can be expensive for a business to implement

Question 65

why is it important to review and evaluate a business change after it has been implemented?

Answer 65

reviewing KPIs to evaluate the effectiveness of a business change can allow a business to identify whether a change has achieved it’s desired objectives or if further change is required
after reviewing KPIs, a business may even find that a change has achieved it’s objectives, but unintentionally affected other areas negatively