Unit 4: Area of Study 2 - Implementing Change Flashcards
Leadership
Leadership is the ability to influence and motivate individuals to achieve Business Objectives
The Importance of Leadership During Change
Leadership is important during Change as it is important to help the Stakeholders during this transition as Change causes resistance. Also, Leadership is important because it can help overcome this resistance if the Manager supports these Stakeholders during the Change
Characteristics of a Strong Leader (List 3)
- Be able to communicate a clear vision with Stakeholders
- Listen to Employee concerns
- Resolve conflicts that may arise as Change is being implemented
- Motivate Stakeholders on the benefits of the Change
- Provide support for those finding it difficult to adapt
- Focus on the needs of Employees as well as the needs of the business
- Get all Employees on the same page and working towards the same goals
Strategies Businesses can Use to Respond to Key Performance Indicators
- Staff Training
- Staff Motivation
- Changing Management Styles or Management Skills
- Increase investment in technology
- Improving quality in production
- Cost cutting
- Initiate lean production techniques
- Redeployment of resources
Staff Training
Is the process of improving an Employee’s skills and knowledge
How Staff Training Impacts the Key Performance Indicators Including (List 2)
- Improves Productivity
- Improved Sales
- Less Workplace Accidents
- Decreased Staff
Absenteeism and Staff Turnover
Staff Motivation
Motivated Employees work harder towards the achievement of Business Objectives
How Staff Motivation Impacts the Key Performance Indicators Including (List 2)
- Improved Productivity Growth
- Lowered Staff Absenteeism
- Lowered Staff Turnover
- Reduced Customer Complaints
Change in Management Styles and Management Skills
The Management Styles and Skills can influence the performance of a business and its culture
Investing in Technology
Technology can be used in numerous ways to improve the business. It can be implemented into all areas of the business
How Technology Impacts the Key Performance Indicators Including (List 2)
- Improving the Rate of Productivity Growth
- Reducing the Level of
Wastage - Increasing Net Profit by reducing operating costs
Improving Quality in Production
Improving the quality of production, improves the quality of the end Good or Service that reaches the Consumer
How Improving the Quality in Production Impacts the Key Performance Indicators Including (List 2)
- Increased the Percentage of Market Share
- Increased the Number of Sales
- Reduced Number of Customer Complaints
- Reduced Level of Wastage
Cost Cutting
Businesses will look to reduce costs without having a significant impact on the overall value to Consumers. Every activity a business performs comes at a cost. Businesses will look at all activities to see where costs can be save
How Cost Cutting Impacts the Key Performance Indicators Including (List 2)
- Increased net profit
- Reduced wastage
- Improved productivity growth
- Increased sales if costs savings are passed onto consumers
Initiating Lean Production Techniques
Lean production is about minimising the waste produced in a business while improving the value to the end consumer
How Initiating Lean Production Techniques Impacts the Key Performance Indicators Including… (List 2)
- Reduced Level of Wastage
- Increased Net Profit
- Improved Productivity Growth
- Increased Sales and Market Share
Redeployment of Resources
Redeployment is the transfer of resources from one place in the business to another. This allows a business to make better use of their resources
Types of Resources that can be Redeployed
- Human Resources (The people within the business)
- Natural Resources (Raw Materials)
- Capital Resources (Machinery and Equipment)
How the Redeployment of Resources Impacts the Key Performance Indicators Including (List 2)
- Improved Productivity Growth
- Reduced Staff Turnover
- Improved Level of Wastage
Seeking New Business Opportunities
Managers will often seek new opportunities to grow and expand the business. Businesses can implement strategies to seek new business opportunities domestically or globally
Management Strategies to Seek New Business Opportunities Domestically
- Multiple Branding
- Franchising
- Government Programs
Domestic Opportunities
Is where the business is looking to gain more business within their current country of operating
Multiple Branding
Is where one business sells multiple brands in the same market
Advantages of Multiple Branding
- It allows Customers to have a choice in a wide variety of products
- It allows a business to hold larger amount of shelf space
Disadvantages of Multiple Branding
The business may receive backlash and Customers may feel the business is only after profits
Franchising
Is where a business grants someone the rights to carry out commercial activities using the brand of the business
Advantage of Franchising
It enables the business to expand while using other people’s money
Disadvantages of Franchising (List 2)
- There is some loss of control
- Profits are shared between the Franchisee and the head company
Management Strategies to Seek New Business Opportunities Globally
- Exporting
- Austrade
- Developing an Online Presence
Global Opportunities
Is where the business is looking to gain more business outside their current country of operations
Exporting
Is where a business sends their Goods or Services to another country for sale
Advantage of Exporting
This can open up new markets and greatly increase sales
Disadvantage of Exporting
There can be extra red tape or taxes involved
Austrade
Is the Government body that is involved in advancing Australia’s international trade and education as well as investment and tourism
Advantages of Austrade
- Austrade establishes connections for Australian businesses
- Austrade makes use of global trade experts
Disadvantage of Austrade
It can be costly to set up an agent and distributor for products
Developing an Online Presence
Putting the business online can attract new customer in new locations domestically or globally. This can be achieved through building a website or through social media
Advantages of Developing an Online Presence
- This method can open up new markets
- It allows the business to sell in a global market
Disadvantages of Developing an Online Presence
- It can be costly to set up
- The business needs to find new distribution channels
Senge’s Learning Organisation
Refers to a business that is flexible, adaptive and productive, which aims to have a culture where people work together at their best and continually learn to work together at their best and will excel during times of rapid change
The Principles of the Learning Organisation
- Systems Thinking
- Personal Mastery
- Mental Models
- Shared Vision
- Team Learning
Systems Thinking
Is the ability to see the big picture rather than seeing things in isolation
Personal Mastery
Is where the people within the business undertake continual learning. Employees continually work towards a vision of themselves. Organisations need to foster a climate where challenging the status quo is expected and where Employees are encouraged to create and pursue their own visions
Mental Models
Are the deeply ingrained assumptions, generalisations and images of how people understand the world. These beliefs and values direct how we behave. During transformation, the business and its people need to look at themselves and scrutinise what they do
Shared Vision
Is being able to develop a vision that the people within the business believe in. This develops commitment rather than compliance. Having all people on the same page can develop a long-term drive towards transformation
Team Learning
Is the process of aligning and developing the capacities of a team to create the results its members truly desire. Individuals that learn together will grow more rapidly
Leaders in a Learning Organisation
- Designers
- Stewards
- Teachers
Leaders in a Learning Organisation: Designers
Are those who are able to design purpose, visions and core values
Leaders in a Learning Organisation: Stewards
Are leaders who look after and protect the vision rather than own it
Leaders in a Learning Organisations: Teachers
Are those that are able to foster an environment where learning is for everyone
Ways of Overcoming Employee Resistance
- Low-Risk Strategies
- High-Risk Strategies
Low-Risk Strategies
Are strategies that are likely to generate positive outcomes, both in the short-term and also in the longer term
Types of Low-Risk Strategies
- Communication
- Empowerment
- Support
- Incentives
Low-Risk Strategy: Communication
This refers to being open and honest about the change so that Employees fully understand the direction of the business and its impact. A business should allow their Employees to voice their concerns and have their questions answered. All of this helps build trust and gain support as Employees have a better understanding of the change
Low Risk Strategy: Empowerment
Involves including Employees in the change process, which can help them get on board with the change. Empowerment shows a level of trust in Employees, which can help gain support for the change. Employees are also less likely to resist decisions they have been involved in making
Low-Risk Strategy: Support
Involves supporting those that are affected by change during the change process. If Employees lose employment due to the change, they can be supported in finding new employment. Others may find the changes difficult and can be supported by training, counselling and consultation
Low-Risk Strategy: Incentives
Is providing something that encourages Employees to embrace the change. This can come in any forms such as promotions or bonuses. This can help Employees accept the change and work towards the new state
High-Risk Strategies
Are strategies that are likely to generate negative outcomes, both in the short-term and also in the longer term
High Risk Strategy: Manipulation
Is the process of gaining support from Employees by using selective facts or deception. This can reduce resistance because Employees are likely to be told the benefits of the change without knowing the negatives. This can harm the morale and culture if Employees find out
High Risk Strategy: Threat
Is forcing Employees to embrace the change or receive punishment. Employees could be threatened through the fear of Retrenchment, the loss of Promotion, Demotion or the Loss of Working Conditions. - This can get Employees to embrace the change quickly. However, this can cause resentment and harm relationships
High Risk Strategy: Threat
Is forcing Employees to embrace the change or receive punishment. Employees could be threatened through the fear of Retrenchment, the loss of Promotion, Demotion or the Loss of Working Conditions. - This can get Employees to embrace the change quickly. However, this can cause resentment and harm relationships
Lewin’s 3-Step Change Model
Is a model that proposes that change could be implemented effectively in a systematic way, by using 3 steps
The Stages of Lewin’s Model
- Step 1: Unfreeze
- Step 2: Change
- Step 3: Refreeze
Unfreeze Stage
Involves preparing the business for change. This includes identifying what needs to change, creating urgency by demonstrating a need for change and challenging current beliefs that may resist change. This stage may be the most difficult
Change Stage
With the business now being unfrozen and prepared for change, they can begin moving to the new desired state. It is important that open communication and support is used in this stage to help those that are finding the change difficult. It is also important that people are empowered to take action and the necessary resources are provided towards the implementation of the change
Refreeze Change
Refreezing is about reinforcing the change and anchoring it into the culture so that it can remain for the long term. Without Refreezing, there is potential that change being implemented and then gradually the business moves back to its old ways. Continuous support and training is provided to reinforce the change and adjustments are made where necessary
Effect of Change on Managers: Change of Management Style
If Key Performance Indicator data suggests that Employees are not responding well to their work environment, Managers may need to change their Management Style. A more Consultative Style may improve Staff morale and motivation
Effect of Change on Managers: Change of Processes
This may require managers to alter their recruitment and selection
processes to reflect the need for individuals who possess the
knowledge and skills required to handle the changing circumstances
Effect of Change on Managers: Change of Structure
A change in the way the business operates may necessitate
a change in the management structure of the business. New
divisions or departments may open up opportunities for a new Manager and new teams.
Effect of Change on Managers: Change of Employment
Some changes may result in the Downsizing of the Business or
outsourcing of a non-core activity. This can result in Managers
being made Redundant as well as Employees
Effect of Change on Employees: Change of Work Environment.
Some Employees may become Redundant or may be offered Redeployment into other areas of the business. Other Employees may need to undergo retraining to be able to use new technology
Effect of Change on Employees: Change of Working Relationships
There may be a change in the culture of the business and work teams may be introduced, changed or ended. A new uniform, new vision statement and new values may all come into play as the new entity develops its own identity
Effect of Change on Employees: Change of Structure
New divisions or departments of the business may arise and some be merged. New teams and new Managers may be needed to suit the new Divisions or structure
Effect of Change on Employees: Change of Focus
The business may want to face new competition by
doing things differently. Longer working hours, greater responsibility for existing Employees and new processes may be implemented
Effect of Change on Customers
The effect of Change on Customers can be positive, such as the improved quality of the Good or Service or the lowered price of the Good or Service. However, the effect of Change on Customer scan be negative, such as a product has stopped being produced or that the product may only be accessible online
Effect of Change on Suppliers
A business may decide to operate in a more Socially Responsible Manner, impacting the types of Suppliers they deal with. Also, a business may decide to move their operations overseas, and use a different Supplier, leaving their current Supplier out of business
Effect of Change on the Community
Businesses may decide to take part of their business offshore to reduce costs, which could result in increased unemployment in the local community. Businesses can also have a positive impact of they expand into a new location, and stimulate the local economy in the Community
Corporate Social Responsibility Considerations in Change
When implementing change, businesses need to consider their commitment to Corporate Social Responsibility. Businesses need to consider their impact on the environment, on the Community, Employees and other key Stakeholders, not only profit. CSR can be a Driving Force for businesses to implement change or the business needs to consider CSR when implementing changes
Corporate Social Responsibility when Downsizing
When a business looks to restructure it should consider the impact on the Employees and the Community by considering reducing the amount of job losses that will occur. The business should implement strategies to find new Employment
Corporate Social Responsibility when Choosing a Supplier (List 2)
- Purchasing supplies from local Suppliers
- Considering the working conditions of Employees in overseas Suppliers
- Looking to support their Suppliers to ensure their ongoing success
Corporate Social Responsibility when Changing Technology
Support and training should be given to Employees to ensure that they feel confident in using the technology. The business should also consider the impact that the new technology will have on Employment levels and that not too many Employees are made Redundant due to technology. The impact of technology on the environment should also be considered
Corporate Social Responsibility and the Environment
Businesses should consider the environment when implementing changes. Changes that could increase pollution or can harm wildlife habits should be considered. Businesses should implement changes that improve the impact on the Environment
The Importance of Reviewing Key Performance Indicators
Businesses use Key Performance Indicators to evaluate their performance. This can drive the business to implement changes. A business needs to assess if the changes have been successful. To do this, they can review their KPI data to see the impact the changes have had. This allows the business to continue on the same path or make adjustments or corrections
Example of the Importance of Reviewing Key Performance Indicators: Foxtel
Due to the reduction in the Number of Sales and poor results around Market Share and Net Profit, Foxtel implemented a number of changes. These changes were implemented to improve the poor results they had achieved. To measure the success of the changes, Foxtel would be looking at the impact the changes had on their Sales, Market Share and Net Profit
