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Unit 4 AOS1 Reviewing performance - the need for change - Coggle Diagram
Unit 4 AOS1
Reviewing performance - the need for change
business change
PROACTIVE: is when a business changes to avoid future problems or take advantage of an opportunity to gain a competitive advantage
REACTIVE: is when a business undertakes change in response to a situation or crisis
BUSINESS CHANGE: is the alteration of behaviours, policies and practices of a business
SIMILARITIES: Both approaches involves the business undertaking change for future benefits, such as growth, progression and to improve or restore it's brand image
DIFFERENCES: proactive change is planned and coordinated use of low risk strategies to take advantage of opportunity and avoid future problems. Whereas, reactive is urgent and pressured high risk strategies to respond to situation or crisis forcing business to change
Key performance indicators
percentage of market share: measures the proportion of a business's total sales, compared to the total sales in the industry, expressed as a percentage figure
no. of workplace accidents: measures the amount of injuries and unsafe incidents that occur at a work location over a specific period of time
rate of productivity growth: is the change in the total output produced from a given level of inputs over time, expressed as a percentage figure
net profit figures: are calculated by subtracting total expenses incurred from total business revenue earned, over a specific period of time
no. of sales: is the total quantity of g/s sold by a business over a specific period of time
no. of customer complaints: is the number of customers who notified their business of their dissatisfaction over a specific period of time
level of staff turnover: is the percentage of employees that leave a business over a specific period of time and must be replaced
level of wastage: is the amount of inputs and outputs that are discarded during the production process
no of website hits: is the amount of customer visits that a business's online platform receives for a specific period of time
rates of staff absenteeism: are the average no. of days employees are not present when scheduled to be at work, for a specific period of time
KPI's: are criteria that measure a business's efficiency and effectiveness in achieving it's different objectives
Force Field Analysis
steps
weighting: is the process of scoring and attributing a value to the driving and restraining forces 1-5
ranking: involves arranging the forces in order of value of determining the total score of driving and restraining forces
implementing response: refers to the action that can be taken to strengthen the driving forces and reducing/eliminating the restraining forces and implementing actual change
evaluating response: is the process of the business determining whether the change has been successfully implemented or not
Driving forces
managers: drive change by supporting initiatives that improve business performance and setting an example for employees to follow
employees: drive change by advocating for improvements in their working conditions and seeking opportunities to enhance business productivity.
competitors: drive change by forcing businesses to adapt their strategies and operations to maintain their market position and ensure survival.
legislation: drives change by requiring businesses to adapt to new laws to avoid penalties and remain compliant.
pursuit of profit: drives change by encouraging businesses to adapt and explore new opportunities to improve financial performance.
reduction of costs: drives change by encouraging businesses to implement strategies that improve efficiency and increase profitability.
globalisation: drives change by increasing international competition and creating opportunities for businesses to expand and produce more efficiently.
technology: advancements drive change by enabling businesses to improve efficiency, reduce costs, and stay competitive.
innovation: drives change by pushing businesses to improve products and services to gain a competitive edge and increase market share.
societal attitudes: drive business change by pushing companies to adapt their operations to align with evolving public expectations and values.
DRIVING: are factors affecting the business environment that promote and support business change
Owners: drive change in a business by making key decisions to ensure its long-term success and competitiveness
Restraining forces
managers
employees
time
organisational inertia
legislation
financial considerations
RESTRAINING: are factors that resist a business change or actively try to stop it
Porta's generic strategies
lower cost: involves a business offering customers similar or lower priced productions compared to the industry average, while remaining profitable by achieving the lowest cost of operations amongst competitors
differentiation: involves 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
similarities and differences:
advantages and disadvantages