3.6 Flashcards
Internal causes of change in business
- Introduction of new tech
- Change in management structure/ leadership style
- Changes in size through organic growth/ external growth
- Response to poor performance
External causes of change in business
- Developments in tech
- Market changes (competitors, new markets, globalisation)
- Changes in consumer tastes
- New legislations
- Changes in workforce
- Changes in economy
Causes of change
- Changes in organisational size
- Poor business performance
- New ownership
- Transformational leadership
- External factors
Change management
To survive, businesses need to adapt to changing circumstances, economic factors, trends etc.
Factors that impact change
- Organisation culture
- Size of the organisation
- Time/speed of change
- Resistance to change
What is scenerio planning?
Looks ahead and thinking about what might happen and start planning for what you might do if a particular scenerio happens
What does scenerio planning include
- Contingency planning
- Risk assessment
- Comparing probability with potential financial impacts (decision trees)
Why use scenerio planning?
- Clarifying future uncertainties
- Identifying risks and opportunities
- Preparing for eventualities
- Teaching managers how events transpire, develop and affect the business
- Understanding causes/effects of change
- Identifying & analysing how to manage change
Steps to scenerio planning
1) Identify possible trends and issues (PESTLE)
2) Build possible scenarios
3) Plan response (develop plan to deal with/react to them)
4) Identify most likely scenarios (risk assessment)
5) Capitalise on scenarios (implementation)
Possible scenarios
- Competitors
- Trends
- Supply issues
- Loss of key personelle
- Natural disaster
Risk assessment
Identifies and evaluates potential risks and plan responses to deal with the impacts of risks if they were to happen
3 categories of risk
- Natural disasters
- IT system failures
- Loss of key staff (succession planning)
