bme 1-6

(desc) internal & (exp) external factors that can drive change

internal

• changes in organisational strategy

• management’s desire to introduce change

• e.g. if cop too high → outsoutcing

• changes in staff

• different generations have different values

• employees may initiate change to improve working conditions / skill development

• introduction of new equipment

• new technology for efficiency / cost savings

external

• law & regulations

• political decisions impact businesses through changing laws and regulations

• changing legal environment can drive change

• society’s expectations

• people change expectations and consumption behaviours

• international events and issues may drive change

• use of technology by customers, force businesses to reconsider their own use of tech

• technological advancements

• impacts the way businesses are able to interact with stakeholders

• drive changes in distribution, e-comm and socmed

reasons for resistance to change

• financial costs

  • real/perceived costs of expansion

  • benefit of the change may seem unclear to employees

  • new tech costly, employees scared they become redundant

• managerial inertia

  • managers are satisfied with the status quo and do not see the need for change

  • employees may feel managers not updating them

  • managers don’t have the skills to solve problems

• cultural incompatibility in mergers/takeovers

  • employees have a certain approach to work

  • friendships broken

  • impact motivation

• staff attitude

  • fear of change

  • don’t have the skills to learn new systems and processes, fear of failure

  • employees don’t believe management can succeed

preparing people for change (kotter’s 8 step change model, lewin’s forcefield anaylsis)

kotter

• provides guidelines for the successful implementation of change

• allows managers to have a clear idea about how to manage change, how to effectively communicate the change to employees

• kotter argues that involvement of staff breeds commitment to change

lewin

• tool used in change management to help employees understand need for change

• weigh out the forces for and against change, give each one a rating from 1-10 based on their importance

• change looks viable if forces for change score higher than the forces that create resistance to change

kotter’s 8 step change model (in depth)

1. establish a sense of urgency

• help others see the need for change and importance of acting immediately

• start honest discussions, give convincing reasons to get people thinking

2. create a guiding coalition

• identify true leaders and key stakeholders, ask for emotional commitment

• employ professionals to help guide through the change process

3. develop a vision and strategy

• clarify how the future differs from the past

• determine values that are central to the change

4. communicate the change vision

• communicate frequently and embed into everything you do

• address concerns and anxieties

5. empower broad-based action

• remove obstacles

• recognise and reward people for making change happen

6. generate short-term wins

• look for sure-fire projects

• give employees confidence

7. consolidate gains and produce more change

• analyse what went right, what needs improvement

• kaizen

8. anchor the new approaches in the culture

• tell success stories

• include the change ideals when hiring and training new staff

benefits & ways to implement diversity as a strategy for business growth

ways to implement

• hire people frm diff bg

• ensure everyone is heard

• empower employees to make decisions

• give constructive feedback

• train staff on cross-cultural communication, etiquette etc

benefits

• open comms leads to better ideas and methods

• greater understanding of needs and wants of customers, suppliers and employees

• employees bring a variety of ideas, creativity and innovation

factors driving global business development

• financial growth opp / loss minimisation

  • identify and capitalise on new market to increase rev and access larger customer base

  • diversify operations, reduce economic & political risks

  • go low-cost country to manufacture g&s

• deregulation of financial market

  • government reduce barriers to the flow of money between nations

  • allows aus busi to access mkt base outside aus

  • can minimise or hedge against financial losses

• WTO regulations and sanctions

  • WTO establishes standards for transparency in intl trade, governs FTAs

  • regulations bind gov to keep their trade policies within agreed limits, allow gov to meet social & economical obj

  • act as a platform for countries to negotiate ToT

  • helps with dispute settlement in resolving trade quarrels and ensuring trade flows smoothly

• consumer purchasing & spending patterns

  • how goods are used for the satisfaction of end consumer, involves human elements

  • consumers use tech to compare products and seek customisation , allowing busi to reach larger customer base

  • businesses gain deeper understanding of their international customers

impacts of globalisation

1. tax havens

• jurisdiction / nation that provides favourable tax conditions and financial secrecy

• attract entities wanting to minimise tax liabilities by taking adv of low / no tax

2. transfer pricing

• same product priced differently in diff nations

• can legally pay less tax in nation w favourable tax conditions

• carefully manage - if not done properly, prone to double taxation

3. domestic market

• competition increase

• force aus firms to increase efficiency and innovate

• cop increase

• mkt saturated

• export

• reduce reliance on domestic mkt

4. international cooperation

• FTA lead to more stable global mkt

• encourage cultural exchange and understanding among busi, fostering mutual respect and reducing intl conflicts

5. employment in developed vs developing countries

• ue in developing countries high, wage rate low

• drive globalisation to developing countries

• however, domestic workers lose out on jobs

6. global spread of skills and tech

• greater sharing of ideas and education

• e-comm, improved security and privacy allows busi to sell products intlly, widen mkt base

benefit of home-grown products to australian businesses

1. employment and social welfare

• greater sales → more employment in home country

• provides residents with more income to spend

• higher employment → less crime

2. greater profits

• can charge premium if got ‘Australian Made’ logo

• appeals to consumers who choose to buy from and support local industries

3. higher govt revenue

• greater profits from increased sales result in higher taxation collection

• can be used to fund infra projects

incentives for international trade

key features & benefits of FTAs

AANZFTA, ANZCERTA

benefits and challenges to australian-owned businesses as a result of FTAs

benefit

1. increase profit

• export internationally with fewer restrictions

2. greater mkt share

• access to overseas markets

3. lower compliance costs and fewer regulatory barriers

• harmonisation of Trans-Tasman food standards

challenges

1. increased competition

• entry of foreign firms who benefit from EOS or lower COP

2. reduced market share

• reduced mkt share frm entry of new competitors

3. regulatory issues

• smes may find it difficult to navigate export-related regulatory complexities

role of innovation

product, process, service

benefits of innovation

financial gain, expansion of global mkt presence, increase mkt share

factors impacting innovation’s success

time, cost, marketing, tech

benefits of using a global brand

consistency, low risk, low cost, better differentiation, easier to manage

factors determining feasibility of global expansion

competitor activity, consumption patterns, level of consumer demand

standardisation vs adaptation of product features, positioning, corporate slogan, product name

rationale / benefit of strategic alliance

sources of financial risk in export markets

non-payment of monies, currency fluctuation

strategies to minimise financial risk

fwd, option hedging, insurance

role of ethics in global business decisions

environmental responsibility, outsourcing, offshore labour

role of businesses in relation to ethical practice in global context

environmental sustainability, CSR, ILO minimum standards

impact of cultural considerations on global business practice

1. levels of education

• depends on level of industrialisation in the country

• limited availability of skilled labour, more availability of unskilled labour

• different pay expectations for diff skillsets

• if lack of skilled labour, may need to outsource certain functions

2. customs

• manners and customs are ways of behaving and conducting oneself in public and business situations

• work condition expectations - provision of culturally appropriate meals for staff, appropriate dress code at work

• understanding & adapting to cultural differences earns consumers’ respect

3. holidays and celebrations

• num of public holidays affects business costs and productivity

• managers need to plan for reigonal holidays that affect availability of clients and staff

• acknowledgement of staff diversity boosts employee morale

4. religious beliefs

• few religions influence business activity directly, but the impact of religion on human value systems and decision-making is significant

• need to ensure they don’t offend customers

• sets guideline for ethical code of practice (CSR)

5. business etiquette

• understanding business etiquette helps create clear standards of behaviour, business policies and procedures so all staff understand what is acceptable

• important in negotiations as personal interpretations may take things out of context and offend busi partner

• e.g. exchange of business cards, formal address

6. communication protocols

• includes internal and external communication between various stakeholders

• understand importance of subtle, non-verbal communication e.g. handshake, bow, kiss on da cheek

• research professional protocols and be perceptive to body language

purpose / intent of strategic planning process

• set overall goals and objectives for the busi

• guides managers when making decisions about alloc of res

key features of strategic plan

1. mission statement

• outline goals and direction of the company

• includes busi culture, values, ethics, future goals and agenda

• defines how each of these apply to the busi’s stakeholders, employees etc

2. objectives

• set of goals that the business aims to achieve over the course of the strategic plan

• they should help the business achieve their mission

• can be further broken down to be measured against KPI

3. environmental scan

• PEST analysis (macro)

  • political, economic, social, technological

• Porter’s Five Forces (operating)

  • threat of new entrants, power of suppliers, power of buyers, threat of substitutes, level of competition

• SWOT analysis (internal)

  • strengths, weaknesses, opportunities, threats

4. strategic formulation

• aims to improve business performance and profits

• help business gain competitive advantage

• provide direction on achieving goals and objectives

5. strategic implementation

• process of turning plans into action to reach the desired outcome

• involves communication of deliverables set against timelines

• involves a five step process: allocation of responsiilities, detailed action plan, timelines, allocation of resources, accountability

6. evaluation and control

• control is measuring activities, timelines and resource consumption, analysing deviations and correcting processes / outcomes

• evaluation is the process of evaluating performance and feeding it back into decision making for the next strategic planning cycle

adapting leadership style in cross-cultural setting

autocratic adapt to participative

• centralised decision making, need to be culturally sensitive

• clear communication, create culture where employees feel safe to express their thoughts and opinions

• incorporate employee input, especiallt in regard to cultural adaptations

leadership traits needed in a cross-cultural setting