Define creative thinking

• Creative thinking is when people are able to think of new approaches and ideas to find solutions to challenges.

• Creative thinking is being resourceful by applying clever ideas to create something new.

Advantages of creative thinking

• Creative thinking will lead to improved participation of staff which will lead to generating new ideas.

• The staff morale will be improved.

• The business will have competitive advantage over other businesses because of the unique strategies that are introduced.

• Businesses will be able to solve complex problems.

Stress, change and crisis management

Causes of stress in the workplace

• Working long hours without adequate breaks

• A heavy workload, unrealistic targets and deadlines aggravated by time pressure.

• Working at home to complete tasks not done at the office

• Managers who are incompetent and inefficient.

Importance of stress management

• If stress is not managed effectively, it can result in absenteeism, poor performance of staff, conflict, grievances and complaints amongst other things in the workplace.

• Constant stress causes many problems for businesses since it can become an unhealthy working environment.

• Too much stress can become a barrier to success and lower the performance of employees.

• Having stressed and tired employees may lead to poor service and unhappy customers.

Examples of a crisis in the workplace

• Theft of assets, equipment and stock.

• Breakdown of machinery

• Power outages

• Loss of property due to fire

Ways the business can manage change in the workplace

• Management should adhere to the plan and not move away from it.

• It is important for businesses to capacitate the employees with stress and change management solutions to cope with different situations.

• By consulting and communicating with employees, management shows that they are transparent and are keeping all staff informed of the unexpected changes.

Globalisation

• Businesses can trade in different countries due to the narrowing of global markets.

• Requires flexibility in order to adapt to changes brought about by globalisation

• The business should ensure that their product or service is of high standard and quality, which will result in competition amongst businesses.

Retrenchment

• Occurs when a business reduces the number of workers in the business or organisation to reduce the cost of the salaries and wages bill.

• Restructuring and economic changes may lead to many people being retrenched from their jobs.

• This is a process that is used by the employer to evaluate the business’ needs in order to increase profits whilst reducing its employees.

Strategies to deal with globalization

• Businesses should be attentive of changes and trends in their related industry.

• Businesses should ensure that their products meet international standards of quality.

• Products that are made available to different markets should be useful, eye-catching and unique.

• Upgrade the enterprise’s IT network to enable online purchasing.

Marketing

Grading and Standardisation

• Standardisation refers to the process of ensuring that goods are produced to the same standards in terms of size/weight/colour.

• There should be no differentiation in terms of the products.

• Products that cannot be manufactured according to pre-determined standards are graded according to the quality of the product.

Finance

• Refers to the act of obtaining funds to ensure that businesses can operate effectively in pursuit of the organisations’ objectives.

• The business acquires funding from financial institutions/investors to expand or maintain operations.

• Equity funding is available from private investors in return for a percentage of ownership of the business.

Consumer goods

• Convenience goods ( bread, milk. soft drinks, etc. ):

-Consumers are not willing to spend much effort on buying convenience goods because they differ very little in terms of price, quality and the satisfaction it provides to consumers.

-These are low priced goods purchased by consumers without much thought.

• Shopping products ( television, motor vehicles, clothing, etc ):

-These goods are more expensive than convenience goods.

-Consumers do not buy them regularly.

-They are prepared to spend a considerable amount of time and energy going to various shops until they are sure that they are getting the best value for their money.

• Speciality goods ( jewellery, branded clothing, etc ):

-These goods usually have specific brand names.

-Consumers know exactly what they want and are willing to search until they find exactly what they are looking for.

• Unsought goods ( funeral services, fire extinguishers, reference books ):

-Goods that consumers do not think of until the need for such products arise.

Industrial goods

• These are goods used in the manufacturing process for example, spare parts, equipment and machinery.

The importance of a trademark

• Establishes an identity/reputation for products.

• Protects businesses against competitors who sell similar products.

• Can be used to market/advertise their products.

For customers:

• Creates a sense of security and consistency for customers.

• Represents a certain standard of quality and price to the consumer

• Consumers are more likely to accept new products that are marketed under a well-known brand/trademark

Pricing techniques

• Bait pricing:

Prices are usually set lower than the item’s cost price in order to attract customers.

• Competition based/orientated pricing:

Involves setting prices in relation to the prices of competitors. The more competition in the market, the lower prices are likely to be.

• Penetration pricing:

When products are sold at very low prices to attract consumers to products that are being introduced into the market then the prices increase at a later stage when the introductory offer is over.

Types of packaging

• Kaleidoscopic packaging:

Some details of packaging change to advertise an important sporting event/competition.

The container or wrapper are continually changing.

• Packaging for immediate use:

Packaging needs to be cheap, because the packaging is thrown away after the product has been used. example) Packet of chips

• Packaging for double use

Consumers will be reminded of the particular brand after the original contents have been consumed. example) Ice-cream tub.

Production

Activities that form part of production planning

• Planning

It will determine the flow of materials to optimise the process.

It must include decisions on the purchasing of the materials, machinery and equipment.

The process will include the layout of the factory to suit the production system.

• Routing

Routing involves the planning of the sequence in which the operation will take place.

Management must determine what the best and cheapest way to sequence the production process will be.

• Scheduling

Scheduling involves the timing of the production process.

It will also prioritise certain jobs and determine which jobs need to be completed before the next one can start.

• Loading

Loading involves the allocation of every person to a specific task and/or machine.

It is linked to the output required to fulfil orders, and the prevention of overloading employees and machines.

The advantages of production planning

• Planning allows businesses to ensure that every machine and worker is used to their full capacity and not left with nothing to do.

• A business can ensure that it has the correct amount of supplies and stock at a given time.

• Planning reduces wastage and unnecessary storage costs.

Define the term quality control

• It is the process of ensuring that goods or services are made to consistently high standards.

• The inspecting of final products to ensure that it meets the required standards.

Roles of quality circles

• They meet regularly to discuss how quality, efficiency and productivity could be improved.

• They analyse problems with the production process and brainstorm solutions.

• Employees are often best placed to know how to improve quality