need for change Flashcards
(28 cards)
business change
the adoption of a new idea or behaviour by a business in response to internal or external environments.
differences between two approaches to strategic management
- lower cost sells at similar or lower prices than competitors whereas differentiation sells at premium prices
- lower cost has an internal focus on operating processes whereas differentiation has an external focus on meeting customer needs
similarities between two approaches to strategic management
- both aim to improve the competitive advantage of a business
- both outline the direction the business should take in order to make a profit
proactive approach
initiation of change is planned and occurs before a business is affected by pressures in their environment
reactive approach
unplanned change taking place after a business has been affected by pressures in their environment
similarities in approaches to change
- both approaches involve business undertaking change for future benefits such as growth
- both approaches are utilised by a manager or business to implement change
differences in approaches to change
- proactive approaches occur when a business takes advantage of an opportunity and avoids future problems whereas reactive approaches in response to a situation or crisis, forcing the business to change
- proactive approaches often involve the use of low risk strategies whereas reactive approaches often rely on high risk strategies
key performance indicators
a specific criteria used to measure the efficiency and / or effectiveness of a business’ performance.
they evaluate objectives by:
- establishing objectives
- developing strategies
- evaluating performance
kpis - list
- percentage of market share
- net profit figures
- rate of productivity growth
- number of sales
- rate of staff absenteeism
- level of staff turnover
- level of wastage
- number of customer complaints
- number of website hits
- number of workplace accidents
percentage of market share
the business’ share of the total industry sales for a particular good or service, expressed as a percentage
net profit figure
the difference between a business’ revenue and profit
rate of productivity growth
the change in a business’ productivity in on year compared to the previous year
number of sales
the measure of the amount of goods or services sold
rate of staff absenteeism
the number of workers who do not turn up for work when they are scheduled to do so
level of staff turnover
the rate at which employees leave the business and are needed to be replaced
level of wastage
the amount of unusable material that cannot be converted to output during production
number of customer complaints
the number of customers expressing their dissatisfaction with the business, either in spoken or written form
number of website hits
the number of customer visits that a business’ online platform receives
number of workplace accidents
an indication of how safe the workplace is for employees
Force Field Analysis
the process of determining which forces drive and which forces resist a proposed change
benefits of force field analysis
- businesses are able to weigh up the factors for and against and determine whether a change is worth undertaking
- force field analusis allows stakeholders to identify the change as positive or negative from their perspective
limitations of force field analysis
- weightings of the forces can be subjective
- some forces may not be clear or identifiabke and may emerge during the change
driving forces
- reduction of costs
- pursuit of profit
- employees
- owners
- managers
- innovation
- technology
- globalisation
- legislation
- competitors
- societal attitudes
restraining forces
- managers
- employees
- organisational inertia
- time
- financial considerations
- legislation
