Unit 4 outcome 1a Flashcards
(31 cards)
1
Q
Definition of business change
A
- when a business is altered to a new or modified form
- involve moving a business from one point to a new one
- occurs as a result of pressure from both the internal and external environment
- two approaches: proactive and reactive
2
Q
Business change: proactive approach
A
- planned change
- foreseeing pressures in a dynamic environment and implementing change to take advantage
3
Q
Business change: reactive approach
A
- is effected by pressures of the business environment
- the business then responds as a result of the pressures
4
Q
Definition of key performance indicators (KPI’s)
A
- tools used to measure how well a business is achieving or has achieved its goals
- sources of data management use to measure business performance against business objectives
- analyse the success of the business
- specific set of criteria that measure efficiency and effectiveness
5
Q
Definition of efficiency
A
- how well a business uses its resources to achieve its objectives
6
Q
Definition of effectiveness
A
- degree to which a business achieves objectives
7
Q
Definition KPI: percentage of market share
A
- a business share of the total sales in an industry for a particular good or service earned over a specific period of time
- express as a percentage
8
Q
Definition KPI: net profit figure
A
- amount of money left over after expenses have been deducted from revenue earned
- calculated over a yearly period
9
Q
Definition KPI: number of sales
A
- amount of goods or services sold in a specific period of time by a business
10
Q
Definition KPI: rate of productivity growth
A
- the amount of outputs produced compared to the amount of inputs used
- the rate in which it increases over time
- measures the efficiency and productivity of a company’s production process
11
Q
Definition KPI: rates of staff absenteeism
A
- number of days in which employees take off work when expected to be there over a given period of time
- if staff absenteeism is high it might be an indicator of low staff morale
12
Q
Definition of KPI: level of staff turnover
A
- the rate in which employees leave an organisation and need to be replaced over a given period of time
- staff turnover means that staff will need to be replaced resulting in recruiting and raining costs and and the loss of productivity and knowledge
13
Q
Definition KPI: level of wastage
A
- amount of avoidable loss of something valuable through under utilisation, decay, erosion or destruction
- relates to waste of any resources including labour, time and money
- good efficiency measure
- by reducing the level of wastage it can reduce the cost of producing a product/service, may also mean that fewer resources are used which is better for the environment
14
Q
Definition KPI: number of customer complaints
A
- amount of customers or those who visit, buy from or use a business that contact the organisation to express their dissatisfaction
- customer complaints may indicate that there is a need to further train staff, redesign products or change production methods
- unhappy customers can have a detrimental impact on future sales of the business, affecting profits
15
Q
Definition KPI: number of workplace accidents
A
- amount of employees who are hurt or injured through incidents at the workplace during work hours
- measure how safe the workplace is
- staff members who feel unsafe may not be motivated to work harder and accidents may stop production
- workplace accidents may result in civil action
16
Q
Definition of driving forces
A
- forces that initiate or support change
- they push the business towards a desired state
17
Q
Driving forces: managers
A
- managers wish to see continuous improvement in the business performance
- they are the ones that set objectives
- they are the driving forces for change to be introduced into an organisation
18
Q
Driving forces: employees
A
- may drive the change as they believe it will be better for the organisation and their long term employment
- may also see it to be advantageous to their employment
- if employees support change then the change process is likely to be successful
19
Q
Driving forces: competitors
A
- organisations may have to change to compete in their market place to maintain marketshare
- if competitors are out performing the business, changes will need to be made to correct the situation
20
Q
Driving forces: legislation
A
- organisations must comply with new laws from the commonwealth, state and local governments as well as other statutory authorities
- there for a change in law may initiate a change to an aspect of a business operation
21
Q
Driving forces: pursuit of profit
A
- if profits are not at the desired levels mangers and/or shareholders demand, a business will need to consider how to generate more revenue or decrease their costs to achieve their objectives
- profits need to be sustained overtime to ensure a business can continue to grow
22
Q
Driving forces: reduction of costs
A
- if a businesses expenses are too high, management will need to look at changes that can be made to cut costs
23
Q
Driving forces: globalisation
A
- the process of growing and expanding to exist throughout the world
- changes in technology have meant a business may be competing with international businesses
- this may mean businesses have to make better use of ecommerce and the potential to faster business growth
24
Q
Driving forces: technology
A
- helps organisations achieve greater efficiencies, cutting costs and improving productivity
- if a business fails to take advantage of technology they will likely loose their competitive edge
- may also force businesses to change their policies to ensure acceptable use of technology
25
Definition of restraining force
- forces that work against a proposed change
| - they make it difficult for the business to implement change successfully
26
Restraining force: managers
- restrain change if they do not implement change in a timely and efficient manner with employee involvement and support
- managers may not have the skills and experience to deal with the change process
- may refuse to implement or fail to actively support the change
27
Restraining force: employees
- if change means loss of jobs or decreased job security employees may resist the change
- this could also occur if they do not understand the change which leads to fear of unknown
28
Restraining force: time
- if change occurs too quickly employees may be overwhelmed
- if change occurs too slow, momentum may be lost
- industry change can happen quickly an if a business lags behind its competitors implementing change then time becomes a restraining force
29
Restraining force: organisational interia
- it is when a business remains still or is content with how the business is without moving towards change
- the business may be running nicely and management don't want to step out of their comfort zone
- management don't see the need for continual change and are happy with the entrenched ways the business operates
30
Restraining force: legislation
- legislation may be rigid and not allow a business to implement all the changes it wishes to
- there may be costs involved in the change (e.g. permit)
- laws can be complex which may be difficult for businesses to understand and implement
31
Restraining force: financial considerations
- change can be expensive
- costs may include redundancies, new equipment, retraining
- businesses may find it hard to borrow money from banks and even when they can, they will have interest repayments to consider
