Chapter 7: The management of change Flashcards Preview

VCE BUSINESS EXAM 2016 > Chapter 7: The management of change > Flashcards

Flashcards in Chapter 7: The management of change Deck (10)
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1

Define high-risk and low-risk practices of the change process

Low-risk practices are those based on a participative approach to implementing change. Low-risk practices include approaches based on two-way communication, empowerment of employees and establishing work teams.

High-risk practices, on the other hand, encompass an autocratic approach to change. High-risk practices can include intimidation, coercion and threats. Communication is likely to be one way and the situation or information might be manipulated.

2

Describe one high risk strategy for change

A high-risk strategy that could be used is threats, that is, telling employees that there will be some form of punishment if they do not go along with the change, for example that they will be dismissed if they do not implement the policy. While it is effective in the short term, high-risk strategies can cause disharmony and resentment among employees, and it may become less effective in the future.

3

Describe one low risk strategy for change

A low-risk practice can involve employee involvement or teamwork through the process, and enables employee input and two
way communication. This practice could enable the HRM to discuss and ask employees their ideas for the process of implementing the new technologies. This strategy can also reduce anxieties as the situation is clearly explained so there are no misunderstandings. One disadvantage is that it is very time consuming to get employee involvement.

4

Define Kotter's theory of change management

Kotter’s theory of change management sets out a systematic process of 8 steps that can help an organisation to undertake change.

5

Step 1: Create the urgency for change.

It helps if the whole organisation really wants the change to be successful. Developing a sense of urgency around the need for change will help spark the initial motivation needed to get things moving.

6

Step 3: Create a vision for change.

A clear vision will help everyone understand what is being asked of them. If they understand what management is trying to achieve, then the directions to them will make sense.

7

Internal sources of change

internal sources for change are those that LSOs have some control over.

Employees working in an innovative environment, where ideas are shared and acted on, are likely to recommend changes to policies, production processes or products.

Customers
To ensure its future profitability, an organisation needs to be very responsive to changes in customer tastes and preferences so it can
constantly satisfy the customers’ needs.

8

External sources of change (macro)

Political and legal forces-
Whenever new laws are passed, organisations must comply with the new legislative requirements. For example, organisations had to alter their unfair dismissal practices in response to the new industrial relations laws implemented by the Rudd Government in 2009.

Technological forces-
An organisation that wants to be locally, nationally or globally competitive must adopt the appropriate technology. If it is slow to exploit technology, an organisation is likely to fail, because its competitors will strive to capture greater market share and develop a sustainable competitive advantage.

9

Driving forces

Are those forces that support the change taking place.

Interest groups
Some groups seek to directly influence the behaviour of organisations. Trade unions, for example, can bring about change in an organisation, especially in regard to wages and
working conditions.

- Customers are driving organisations to change or implement modifications in their products to ensure they are continually satisfied as consumers.

10

Restraining forces

Are those forces that work against the change.

One restraining force could be an organisations employees. Employees can prevent the successful implementation of change if they are fearful of planned changes and do not want to alter their work procedures and practices.

- Cost of change may cause less competitiveness of business. Even given sufficient finances, an organisation contemplating change must weigh up the costs and benefits of the change. Well-informed, calculated decisions to proceed will minimise the risk and enhance the long-term viability of the change.

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