Component 3 Change Management
an ongoing process, that businesses can't avoid having to deal with its consequences
change can be gradual, with small incremental changes that are made to the way they operate
however, there are causes for rapid change, altering the way in which a business operates in a short period of time creating more challenging environmet
causes of change can be classified as internal/ external
internal causes initiated by the business: introduction of ne tech, change in management structure/ leadership style, change in size of business through organic growth/ external growth;
external causes initiated by factors from outside the business, which it has little/ no control of: developments of tech, market changes, changes in consumer tastes, new legislation, changes in workforce, changes in economy;
Planned change is created internally- structured + timetabled; clear objectives for change established, timetables created, resources applied to creating change;
Unplanned change occurs in response to shock to business+ often unstructured and under-resourced
Contingency planning should help business minimise effects on unplanned change
effects of change upon a business vary and no two businesses are impacted in an identical way
shorter product life cycles- applies to right across the range of consumer goods- consumer tastes are ever changing; trend brings both threats/ opportunities to retailers+ manufacturers-> products more profitable immediately, little incentive for long term investment; returns can be improved by seeking new market products
diminished brand loyalty- new entrant into market find it easier to grab market share, existing businesses fight hard to maintain sales; marketing costs increased to maintain brands+ introduce new products
new product development- strategic planning required by businesses to ensure that new products are developed in response to changing market conditions; also needs to be to be aware of possible future consumer tastes+ make sure they are prepared to respond to changing customer needs;
changing production methods- need to change to match changing customer demands; require spending on research/ development/ production technology; consequence- capital goods become out of date faster/ new production techniques needed
retraining the workforce- existing employees not able to adapt to new way of working/ new technologies introduced so training/ recruitment costs increase
potentially offers many benefits, supports smooth transition form old ways of working to new ways of working
assess+ understand need for impact of change
allocate resources+ staffing business supports implementation of change
manage/ control costs incurred with change
reduce time needed to implement change
plan/ implement effective strategy to communicate change with stakeholders, helps with business support staff through change
maintain/ improve performance of business
change allowing business to implement change in smooth manner reducing resistance form stakeholders+ allows business to operate efficiently
leaders of organisation planned process of change effectively, then a clear set of objectives is identified
whole range of quantitative/ qualitative indicators that can be examined related to objectives initially devised prior to the changes that occurred
include: delivery times, production defects, customer satisfaction surveys, customer satisfaction surveys, market share, sales turnover, profitability
most difficult tasks of leadership is encouraging/ managing organisational change-> managers need to put in place number of key strategies
Employee preparation- no change can occur without full support of employees