Business Change: Driving & Restraining Forces, Competitive Strategies

A set of vocabulary flashcards summarising the concepts, forces, and strategies influencing business change and competitiveness.

Driving Forces

Internal or external factors that push a business toward implementing change.

Restraining Forces

Internal or external factors that hinder or block a proposed change in a business.

Force Field Analysis

A decision-making model that compares driving and restraining forces to determine whether a change should proceed.

Lewin’s Model (Force Field Steps)

Process of 1) identifying forces, 2) weighing their influence, 3) ranking them, 4) proposing solutions, 5) evaluating results.

Managers (as a Change Driver)

Leaders who guide employees, provide ideas, feedback, and actively support new initiatives.

Managers (as a Restraining Force)

Blockers who delay or refuse to implement change through active or passive resistance.

Employees (as a Change Driver)

Staff who carry out daily tasks, speak positively about change, and suggest improvements during implementation.

Employee Resistance

Feelings of loss, fear of failure, discomfort, or disorientation that slow or stop change.

Competitors

Rival firms that spark change by innovating, lowering costs, or highlighting weaknesses in other businesses.

Legislation

Laws, regulations, licences, and penalties that compel businesses to adjust operations to remain compliant.

Pursuit of Profit

Primary business objective of increasing remaining funds after costs, driving change to meet shareholder expectations or recover lost margins.

Reduction of Costs

Effort to lower expenses so profit can rise even when revenue stays flat, often motivating operational change.

Globalisation

Worldwide integration that expands markets, improves living standards, enables economies of scale, and drives faster growth.

Economies of Scale

Cost advantages gained when a business produces at optimal efficiency, lowering per-unit expenses.

Innovation

Introduction of new ideas, products, or methods to gain a competitive edge and improve performance.

Societal Attitudes

Evolving opinions, values, and lifestyles that businesses must adapt to in order to stay relevant.

Organisational Inertia

A conservative, tradition-bound culture that makes lasting change difficult to implement.

Active Resistance

Open opposition to change, such as refusing to carry out new procedures.

Passive Resistance

Lack of enthusiasm or silent non-compliance that slows change without open conflict.

Porter’s Generic Strategies

Framework outlining cost leadership (lower cost) and differentiation as two main ways to gain competitive advantage.

Cost Leadership (Lower Cost)

Strategy of becoming the lowest-cost producer to increase profit or market share by offering lower prices.

Cost Leadership – Benefits

Attracts price-sensitive customers, discourages new entrants, and forces internal efficiency.

Cost Leadership – Drawbacks

May sacrifice quality, lower customer loyalty, create low margins, and risk ‘cheap’ brand perception.

Differentiation

Strategy of offering a unique product feature, quality, or service that competitors find hard to replicate.

Differentiation – Benefits

Fosters customer loyalty, supports premium pricing, reduces direct competition, and boosts uptake of new products.

Differentiation – Drawbacks

Higher costs for R&D or quality inputs and a smaller potential customer base.