unit 4 AOS 1

Question 1

what is a business change?

Answer 1

Business change is the process of making alterations of behaviours, polices and practices of a business

any alteration in the internal or external environments

Question 2

why is change important?

Answer 2

to achieve business objectives

to remain competitive

Question 3

what is a proactive approach?

Answer 3

a situation where a change is planned and occurs before a business is affected by pressures in their environment.

Question 4

what is a reactive approach?

Answer 4

when a change is unplanned, and takes place after the business had been affected by the pressures from its environment

Question 5

what are key performance indicators?

Answer 5

specific criteria used to measure the efficiency and/or effectiveness of a business’s performance

used to analyse a businesses performance

Question 6

what are the KPS?

Answer 6

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

Question 7

what is the KPI Percentage of market share?

Answer 7

The businesses share of the total industry sales for a particular good or service, expressed as a percentage

Question 8

what is the KPI Net profit figures

Answer 8

The amount of money left over after all expenses have been deducted from revenue earned

Question 9

what is teh KPI Rate of productivity growth

Answer 9

The amount of outputs produced compared to the amount of inputs used and the rate in which it increases overtime

Question 10

what is the KPI Number of sales

Answer 10

A measure of the amount of goods or services (products) sold in a specified period of time

Question 10

what is the KPI Rate of staff absenteeism

Answer 10

The number of staff who do not turn up for work when they are scheduled to do so

Question 11

what is the KPI Level of staff turnover

Answer 11

The number or the rate, of employees who are leaving the business over a specific period of time, and need to be replaced by new employees

Question 12

what is the KPI Level of wastage

Answer 12

The amount of unwanted or unusable material created by the production process of a business

Question 12

what is the KPI Number of workplace accidents

Answer 12

The amount of unplanned or uncontrolled events that result in personal injury or property damage at a business

Question 12

what is the KPI Number of website hits

Answer 12

Measures the amount of times individuals visit a businesses website

Question 13

what is Lewin’s force field analysis about?

Answer 13

Kert Lewin developed a model that helped managers understand the factors that worked in support of a change and those that worked against the change

Question 13

what is the KPI Number of customer complaints

Answer 13

The number of customers expressing their dissatisfaction with the business, in either spoken or written form

Question 14

what is driving forces

Answer 14

Forces that encourage and support a change

▪ Customers 
▪ Legislations 
▪ Changes in technology 

Driving factors are factors affecting the business environment that promote and support business change - they work to encourage, and initiate change

Successful change is more likely to occur when driving forces outweigh the restraining forces of a proposed change

Question 15

what is restraining forces?

Answer 15

Forces that work against the change
▪ Financial considerations
▪ Employee resistance
▪ Time
▪ Managers

Restraining forces are those that work against a change. They make it difficult to implement a change successfully.

Question 16

what are the four key principals of the force field analysis?

Answer 16

1. weighting
2. ranking
3. Implementing a response
4. Evaluating the response

Question 17

what is the weighting principal about?

Answer 17

the process of scoring and attributing a value to the driving and restraining forces

· Identify the driving forces that promote the change and restraining forces that resist the change

· For each force, a weight is assigned to it to determine the level of impact each force can potentially have on the change

Question 18

what is the ranking principal about?

Answer 18

arranging the forces in order of value and determining the total score of driving and restraining forces

Ranking helps determine which driving forces could be strengthen and which restraining forces could be removed or minimised

Question 19

what is the Implementing a response principal about

Answer 19

developing an action plan to reduce the strength of the restraining forces and increase the strength of the driving forces

· The action plan details what needs to be done, who is responsible, the resources required and deadlines for task completion

Question 20

what is the evaluating the response principal about

Answer 20

determining whether or not the change has been successfully implemented

Evaluate the response to determine its effectiveness.

A business can use KPIs to measure the success of the change in achieving business objectives

Question 21

what are some disadvantages of the force field analysis

Answer 21

The weightings of the forces are subjective. Biases can emerge when determining the importance of a particular force. Assigning responsibility to people to manage aspects of the change may result in a need for training as the skills of people may be lacking or overestimated.

Question 22

what are some advantages of the force field analysis

Answer 22

Businesses are able to weigh up the factors ‘for and against’ and whether the change is worth undertaking. It allows a business to identify and strengthen the driving forces supporting the change and to take action to reduce or eliminate the restraining forces. Force Field Analysis allows stakeholders to identify the change as a positive or negative change from their perspective.

Question 23

how can owners act as a driving force?

Answer 23

Owners act as a driving force for change if they believe it will be beneficial to future business performance Owners have a vested interest in the ability of their business to meet objectives and continue to adapt owners can initiate change in a business

Question 24

how can managers act as a driving force

Answer 24

- Managers act as a driving force for change when the proposed change will enhance the business ability to meet objectives When a manager is in support of a change, they can encourage successful change implementation Managers ensure that business performance is being optimised and objectives are being achieved

Question 25

how can employees act as driving force

Answer 25

Employees can instigate change in a business by driving improvements in processes, product features..etc Employees can act as a driving force for proposed changes that would improve their work environment Employees are responsible for achieving business objectives

Question 26

how can competitors act as a driving force

Answer 26

- Competitors can drive change through: opening a new business; pricing policies; use of new technology; marketing The competitive nature of a business can initiate change in a business as they compete for customers

Question 27

how can managers act as a restraining force

Answer 27

Managers can be a restraining force when they are unwilling to introduce a business change if they do not support the change

Question 28

how can employees act as a restraining froce

Answer 28

employees can be a restraining force if the outcome is uncertain, they fear they cannot adapt or if it impacts job security of work routine fear of the unknown

Question 29

how can time act as a restraining force

Answer 29

Business change often had to be completed before, after or within a certain time period

Question 30

what is Porter generic strategies

Answer 30

Porter’s Generic Strategies can help determine the strategic direction required for business change porters generic staregies is an approach where a business can gain a competitive advantage by implementing the lower cost or differenetiation strategy

Question 31

what are the two startegies of porters startegic manageent

Answer 31

Porter proposed that businesses can gain a competitive advantage by adopting: - Lower costs - Differentiation

Question 32

what is the lower cost staregy

Answer 32

The lower costs strategy is where a business gains a competitive advantage by being the low cost producer in the industry - This strategy is suitable where industries have a large number of cost-conscious customers who have little brand loyalty and will choose to purchase from the cheapest supplier - A competitive advantage is gained through reducing the costs of the business, allowing it to operate with larger profit margins compared to market rivals

Question 33

what are some advabatges of the low cost staregy

Answer 33

- A business may become more profitable, as profit per unit can increase - Gains competitive advantage - A business may save money on some costs to allow expansion or development of new lines - Savings can be put towards differentiation at a later date

Question 33

what are some disadvantages of the low cost staregy

Answer 33

- Sales may fall as customers may perceive a product as being of poor quality A business may lose its market share if other businesses copy the low-cost approach

Question 33

what is the differention strategy

Answer 33

Differentiation is where a business gains a competitive advantage by being unique in some way that is valued by customers - Offering customers unique services or product features that are of perceived value to customers, which can then be sold at a higher price than competitors - Through differentiation, a business will make their product different, unique or superior in some way to gain a competitive advantage - This strategy is suitable for customers who are not price sensitive and/or customers who have specific needs that are currently either unmet or under-served

Question 34

what are some advantages of the differentiation straetgy

Answer 34

- Differentiation is way to improve the way a business connects with customers, and can develop customer loyalty - By developing customer loyalty, market share can be increased - Gains competitive advantage

Question 35

what are some disadvantages of the differentiation strategy

Answer 35

- Rival businesses can copy differentiated approach, negating any gains - Differentiation has an initial cost that must not outweigh the benefits - Differentiation can be a time-consuming process, and, during that time, consumer tastes or preferences may change - Often more expensive to be unique