Business organisation and environment

Table of Contents

1. Topic pack - introduction
2. 1.1 Nature of business activity - notes
3. 1.1 Nature of business activity - questions
4. 1.2 Types of organisation - notes
5. 1.2 Types of organisation - questions
6. 1.3 Organisational objectives - notes
7. 1.3 Organisational objectives - questions
8. 1.4 Stakeholders - notes
9. 1.4 Stakeholders - questions
10. 1.5 External environment - notes
11. 1.5 External environment - questions
12. 1.5 External environment - simulations and activities
13. 1.6 Organisational planning tools - notes
14. 1.6 Growth and evolution - notes
15. 1.7 Growth and evolution - questions
16. 1.7 Growth and evolution - simulations and activities
17. 1.6 Change (HL only) - notes
    1. Change
    2. Causes of change
    3. Resistance to change
    4. Force Field Analysis
    5. Impact of change
    6. Change management
18. 1.9 Globalisation - notes
19. 1.9 Globalisation - questions
20. Print View

Impact of change

Rapid change can force businesses to restructure and make changes to retain their competitive advantage. Change normally makes product life cycles shorter which requires increased investment in research and development to maintain a balanced portfolio of products. Firms may find that a product that was a 'cash cow' in their Boston Matrix may quickly become a 'dog'. Research and development is necessary to ensure a new crop of 'stars' for the future. Firms will also have to look carefully at what their competitors are doing using benchmarking to ensure that they remain competitive.

Firms will have to focus increasingly on quality as consumer tastes change and expectations rise. Quality approaches such as TQM (Total Quality Management) may, by changing the organisational culture, reduce resistance to change.

Change will also impact on working practices. To be more responsive and flexible firms may consider:

• More part-time and temporary working - people may be employed on shorter or even temporary contracts to allow the firm to adapt rapidly to changing circumstances.
• Increased working from home - people working from home enable the firm to respond quicker to changing circumstances. They don't need to build physical space to accommodate people in response to rapid changes in demand. Technological developments are leading to this becoming increasingly common with people able to access company resources through company networks.
• Increased incentive payments - firms may restructure their remuneration packages to try to incentivise people more and make them more willing to accept required changes.

As can be seen, change affects all aspects of the Business and Management programme and will impact on all business functions. Managing change may have some of the following implications:

• New production methods
• Flatter, smaller organisations
• Improved communication techniques
• Increases in research and development
• More frequent market research to identify trends in consumer tastes and buying habits
• Additional finance to fund new investment