Chap 4.5: Driving Forces for Change

Front

Define DRIVING FORCES

Back

Factors that promote and support business change, pushing for the change to occur.

Front

List 11 DRIVING FORCES for change ?

Back

• Pursuit of profit

• Owner

• Cost reduction

• Employees

• Manager

• Globalisation

• Legislation

• Innovation

• Competitors

• Technology

Front

The change is more likely to occur when .......

Back

when DRIVING FORCES outweigh the RESTRAINING FORCES of a proposed change.

Front

Explain why OWNER is a DRIVING FORCE for change in the business?

Back

Owners play a crucial role in driving change within a business.
• Key responsibilities: Owners are the highest level of management, responsible for long-term decisions, expansion strategies, and ensuring the business meets its objectives.

• • Vested interest: As owners have a personal stake in the business's success, they are motivated to adapt and remain competitive in a dynamic environment.
  

• • Financial incentives: Owners directly benefit from the financial performance of the business, further incentivizing them to pursue changes that improve profitability.

Front

Explain why MANAGER is a DRIVING FORCE for change ?

Back

Managers are crucial for successful business change.

• • Key responsibilities: Managers oversee daily operations and ensure the business achieves its long-term goals. They are responsible for implementing policies and procedures.
  

• • Driving force for change: Managers provide strategic direction or actively participate in change implementation. Their support and leadership are essential for successful change.
  

• • Motivations for change: Managers, as employees themselves, are concerned with job security and financial incentives, which motivates them to seek opportunities for business improvement.

Front

Explain why EMPLOYEE is a DRIVING FORCE for change ?

Back

Employees are a vital driving force for successful business change.

• • Key role: Employees are responsible for achieving business objectives and their support is crucial for successful change implementation.
  

• • Personal interest: Employees, while focused on their own working conditions, wages, and benefits, also have a vested interest in the overall performance of the business.
  

• • Driving force for change: Employees can initiate and support changes that improve their work environment, such as increased flexibility and better working conditions.
  

• • Employee empowerment: Participative management styles encourage employee input and innovation, leading to valuable suggestions for business improvement.

Front

Explain why PURSUIT OF PROFIT is a DRIVING FORCE for change ?

Back

Profit is a primary driving force for business change.

• • Key motivator: Businesses, regardless of size, strive to increase sales, market share, and ultimately, profit.
  

• • Sustained profitability: Consistent profit is crucial for business growth and meeting shareholder expectations (dividends, high share prices).
  

• • Market adaptability: Businesses must constantly adapt to changing market conditions to maintain profitability.
  

• • Driving force: The pursuit of profit compels businesses to explore and implement new strategies and changes to remain competitive and successful.

Front

Explain why COST REDUCTION is a DRIVING FORCE for change?

Back

Cost reduction is a key driver of business change.

• • Focus on profitability: All businesses seek to minimize costs to improve profitability, especially when revenue growth is limited.
  

• • Areas for cost reduction: Potential cost-cutting measures can be found across various departments, including purchasing, production, sales & marketing, finance, and administration.
  

• • Driving force for change: The constant pressure to reduce costs necessitates ongoing evaluation of business processes and the implementation of cost-saving measures, thus driving change within the organization.

Front

Explain why LEGISLATION is a DRIVING FORCE for change ?

Back

Legislation involves laws and regulations businesses must follow. It can drive change, requiring compliance to avoid fines or closure. Businesses must adapt to new legislation.

Front

Regarding LEGISLATION as a DRIVING FORCE for change, explain how the Federal Government may motivate business to change ?

Back

The federal government may pass laws affecting taxation and publish budgets impacting government spending. These changes can target specific business types and sizes, affecting employment and business operations.