causes and effects of change

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  • causes and effects
    • organisational structure
      • gains a competitive advantage with brand recognition, economies of scales and financial security
      • productivity will improve as the company grows. but in order to cope with this a change in process and methods will often follow.
      • the company is likely to have to reinvest in order to pay for the growth, money potentially coming from profits or borrowings.
      • stake holders will be more invested, for example staff have the opportunity for promotion in the organisation and bonuses. however they can also feel insecure in their own job position. in terms of customers, they have the potential to lose customer relationships due to the expansion in customer base.
    • poor business perfomance
      • poor performance often goes hand in hand with a loss in competitiveness
      • the business will have to find a way in order to cover the excessive costs now in production . this may come from cutting down HR.
      • the company is likely to face liquidity problems which again could lead to cutting costs in some area.
      • it is likely to have a bad effect on stakeholder, as it often can lead to redundancies.
    • P.E.S.T.L.E
      • being a head of competitors in terms of P.E.S.T.L.E can mean that the business has a significant competitive advantage
      • productivity is likely to also increase with technological advancements
      • however it is likely that P.E.S.T.L.E changes are costly, however these costs are across the whole market, not just individualised to the business
      • P.E.S.T.L.E changes are likely to be experienced by stakeholder. for example it may lead to retraining for employees and additional costs for the consumer.
    • transformational leadership
      • MAY LEAD TO A CHANGE IN VISION AND NATURE OF THE BUSINESS - uncertainty
      • often after  a period of poor performance or should leadership leave or retire - new ideas
    • ownership (merge)
      • competitiveness is likely to be impacted dependent on how the business integrate if caused by merge but it may lead to more power in economies of scales
      • short term the productivity will be disrupted. however in the long term productivity will rise
      • this is financially risky as the merge may fail. however the announcement of acquisition and the merge may lead the demand for stocks to increase.
      • the is the potential for a clash of cultures between the businesses which would be extremely negative, and potentially costly, for the business

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