Preparing for change

Forecasting: managers will produce forecasts for sales. These may be based on past trends or produced through market research. 

Strategic planning: techniques such as SWOT analysis help managers to think of changes that might happen and the opportunities and threats this creates. 

Developing a flexible organisation: this helps the business to respond to change when it occurs. 

Flexibility may be helped by: 

• Employing people on temporary or part-time contracts so they can be used when demand is high without the business committing to permanent full-time contracts. 

• Using subcontracts so that production can be increased if needed without committing to capacity that may not be used. 

Scenario planning: this is when managers produce different possible situations that the business may be operating in the future - they create two or three possible scenarios which describe how an industry might look in the future. 

Contingency planning:  this is when managers plan for possible unfavourable situations, by anticipating and planning for what might happen - it allows the business to have backup plans, which can help a business respond quickly and effectively. However, managers can’t plan for every unfavourable situation - and must decide on what are the most important contingencies to plan for.