what is step change?
significant and rapidly occurring change
what is incremental change?
changes occur over a period of time in small changes
internal causes of change?
- new leadership
- new ownership
- poor business performance (profitability)
- changes in organisational structure
external causes of change?
- PESTLE factors
- competitor actions
what is disruptive change?
a form of step change that arises from changes in the external environment - it affects the market as a whole
what is the main cause of disruptive change?
technologies and developments (disruptive technologies)
effects of change?
- helps sustain a competitor advantage
- aligns strategy with customer needs
- business can take advantage of technologies ( increase productivity)
- stakeholders can gain from improved productivity
- organisational change may improve communication
- leading change rather than following change = first mover advantage eg technologies
signs that organisational culture may need changing?
- internal fighting
- high levels of voluntary staff turnover & hard to retain top talent
- greater absenteeism
- processes become more bureaucratic
- innovation is no longer valued
- declining customer service
- leadership is inconsistent
- communication becomes more closed and restricted
what are the key factors in change?
- organisational culture
- size of organisation
- time/speed of change (incremental/step)
- managing resistance to change
what are the 4 reasons why there is a resistance to change?
- self interest
- low tolerance for change and inertia
- different assessment of the situation
- misinformation and misunderstanding
why does resistance to change occur due to self interest?
due to a perceived threat to job security, status and financial position
why does resistance to change occur due to misinformation/misunderstanding?
workers are unsure as to why change is needed - misinformed about the strategic position of the business
why does resistance to change occur due to different assessment of the situation?
disagreement abut the need for change or what the change needs to be
why does resistance to change occur due to a low tolerance for inertia?
people require stability, security and predictability in their work
how can you overcome resistance to change?
- education and communication
- participation and involvement
- facilitation and support
- manipulation and cooption
- negotiation and bargaining
- explicit and implicit coercion
what are the key risks that can be identified through scenario planning/risk assessment?
- natural disasters
- IT system failure
- loss of key staff
what are the common forms of risk mitigation?
- risk acceptance
- risk avoidance
- risk limitation
- risk transference
what is continuity planning?
how a business will operate following a serious incident or disaster and how it expect it to return to normal
what is succession planning?
involves identifying and developing current employees who have the potential to move into key roles in the future
- often used when preparing for the loss of key staff
what is risk in business?
the possibility of loss or business damage, may be caused by a threat that may prevent or hinder the ability to achieve a business objective
what is scenario planning?
the process of anticipating changes in a business situation and devising ways of dealing with them
what is risk mitigation?
plans, identifies and assess risks and plan responses to those risks
what are the two key elements of risk assessment plans?
- continuity planning
- succession planning
how to evaluate the use of scenario planing?
- risks vary in terms of their significance to the business and likelihood
- scenario planning is not required for every eventuality
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2.1 Raising Finance24
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2.2 Financial Planning19
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2.3 Managing Finance28
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2.4 Resource Management57
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2.5 Economic Influences21
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3.1 Business Objectives and Strategy57
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3.2 Business Growth35
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3.3 Decision Making Techniques27
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3.4 Influences On Business Decisions55
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Profitability 20 Mark Answers5
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3.5 Assessing Competitiveness58
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3.6 Managing Change24
