UNIT 4 AOS 1

• The concept of business change

  The concept of business change refers to transitioning individual employees, working teams, functions, or the whole business to a new state of operation. Businesses are constantly evolving and adapting to improve their performance.
• Proactive approach


  A business with a proactive approach makes changes to the structures, processes and workplace in order to avoid a potential future threat or problem, or to take advantage of a future opportunity. 
• Reactive approach 


  A reactive approach to change is initiated by a business because of external forces. The change usually happens after an event, threat or opportunity has occurred. ​
• Key Performance Indicators (KPI's)

  Key performance indicators (KPIs) measures or a set of data that allows a business to determine whether it is meeting its business objectives. For businesses to make accurate evaluation about performance, it should use a range of indicators and data.
• WHY IS IT IMPORTANT FOR A BUSINESS TO ANALYSE ITS PERFORMANCE?

  All businesses should regularly assess their performance and use a range of data and key performance indicators to ensure that information is relevant, accurate, reliable and timely. Businesses will often make major decisions based on the information available. Therefore, it is critical that a business, regardless of its size, gathers and uses KPIs and other information.
• Percentage of market shares


  the proportion of sales of a product by a business in relation to total sales of that product in a market (expressed as a percentage)
• Net profit figures 


  The amount of money that is left after expenses have been deducted from revenue earned
• Rate of productivity growth 


  productivity measures the business's ability to transform inputs in outputs
• Number of sales


  Measures the total quantity of products/services sold in a period of time compared to another period of time.
• Rates of staff absenteeism


  a percentage indicating the number of work days lost due to staff's absence from work
• Level of staff turnover


  The level of staff turnover measures the number of people or employees permanently leaving a business. If the level of staff turnover is high, it may indicate dissatisfaction in the workplace. Staff turnover is also a financial cost to a business, including costs for advertising, recruiting, inducting and training new employees.
• Level of wastage


  measures the extend to which a company's processes are lean and effective. The level of waste in a production process will impact on business efficiency.
• Number of customer complaints


  the number of written or verbal dissatisfaction from customers regarding a business' products or services
• Number of website hits


  number of people or potential customers, have sent a request to a webserver. It can be used to measure website traffic, in the form of: number of visitors, percentage of new sessions, and time spent on website.
• Number of workplace accidents 


  The number of unplanned events interrupting the workflow, such as employee injury or damage to the property or environment
• Lewin's Force Field Analysis


  a decision making tool that is issued during times of change in a business. It looks at forces that are either driving movement towards a goal or change (driving force) or blocking movement towards a goal or change (restraining force)
• Driving forces


  forces affecting a situation that are pushing in a particular direction and are supporting the goal or proposed change
• Restraining forces


  all the personal and organisational resistance to change that acts against the driving forces and could involve management, employees, cost, legislation and competitors
• Lewin's model focuses on the following steps


  weighting, ranking, implementing a response, evaluating a response
• Weighting


  this means managers in a business may need to identify the driving & restraining forces and then provide them with a number according to how important they are perceived to be
• Ranking


  the considerations or forces are placed in order from the most important to least important
• Implementing a response 


  once the business has weighed up the factors, it them makes a decision
• Evaluating a response


  once the decision has been made, the business must continue to monitor the situation to ensure that the decision was the correct one
• Driving forces - owners/managers


  they influence and will either provide the strategic direction for the change or be involved in a 'hands on' role in implementing change.
• Driving force - employees


  critical driving force for change, if they support the change and are willing to implement it, the business is likely to find that the change can be successfully introduced
• Driving force - competitors 


  competition means that a business must always be aware of what its competitors are doing to be able to respond quickly and implement changes to stay ahead
• Driving force - Legislation


  businesses have to deal with three levels of government at a federal, state, local level. All 3 level can enforce change upon a business
• Driving force - Pursuit of profit


  profit drives a business to introduce change. it will need to continually review practices to ensure it is efficient and look at ways to retain or increased profit levels
• Driving force - Reduction of in costs


  a focus on reducing costs will lead to change in a business. This may include examining current practices & processes and trying to find more efficient ways of doing things
• Driving force - Globalisation


  the process where economic boundaries are removed and businesses begin operating on an international scale. As technology and communication improves and it becomes easier to sell products to customers in different countries, businesses have to consider this and look at ways to expand
• Driving force - Technology


  this constantly changes & continues to drive changes in business. If a business is not able to maintain and upgrade technology used, it is unlikely to remain competive and will lose sales
• Driving force - Innovation


  the need to continually improve or come up with new products will impact a business & cause it to take proactive approaches to look for new ways to do things
• Driving force - Societal attitudes


  attitudes change over time and therefore require change in a business. Members of society can show the need for things to be addressed, while employees can seek a work life balance. Businesses may change working conditions and the products & services it provides
• Restraining force - Managers 


  They act as a restraining force, they may try to block or stop change from occurring as they may think that the change will impact their authority and power
• Restraining force - Employees


  May resist change if it affects them and makes their roles more difficult or harder as many people resist change. If employees resist change, it is likely to be resisted.
• Restraining force - Time


  a restraining force on a business as there may not be enough time to be implemented properly. A business may weigh up a suggestion and determine that it is not viable due to the time needed
• Restraining force - Organisation inertia


  when a business is unable to foresee the need for change or implement it. Businesses that suffer from organisational inertia usually do not survive in the long term as their competitors will be more proactive and implement change
• Restraining force - Legislation


  Laws and regulations are outside the control of the business. They must be followed by a business. A change in law may be a restraining forces as it may inhibit or limit a business in carrying out tasks
• Restraining force - Financial considerations


  Businesses may not have access to funds and interest rates are too high to access a loan, costs associated with change may be too high for benefits and impact operations. It is important to conduct a cost-benefit analysis
• Ways to achieve cost leadership - Asset Utilisation


  This means being able to use resources efficiently. E.g. restaurants having a large number of customers come through by having a number of different sittings in the evening.