‘Change’ is any alteration in the business and work environment; for example, change in consumer tastes, change in production methods, change in markets or products sold, or change in how employees perform their tasks. It could also be a change to the way things are perceived, or new ways of dealing with problems.
The rapidly increasing pace of change threatens to overwhelm many businesses. Adapting to change forced by the external environment is never easy for a business.
While change may be the most daunting challenge confronting management, the rewards are great for those who are prepared to accept the challenge and not only react to change but also initiate and ...view middle of the document...
Internal change from identifying new methods, technology, systems and procedures. New business cultures also affect organisations internally.
The external business environment comprises the factors and characteristics that are largely outside the direct control of owners, directors and managers.
The internal business environment comprises the factors and characteristics that are within the direct control of owners, directors and managers.
Changes within the external environment make it necessary for managers to make adjustments to business operations. For example, new government regulations may require a manufacturer to install pollution-control devices on a product or plant.
The actions of competitors may force a business to reassess its operations and implement changes.
The changing nature of markets
Globalisation is the process whereby hi-tech communications, lower transport costs and unrestricted trade and financial flows are turning the whole world into a single market. The more integrated global economic system has altered the shape of world markets are the nature of the businesses that compete in them. Many Australian businesses must now compete against overseas products in the domestic market, in addition to competing in overseas markets when exporting.
Australian businesses are increasingly meeting this challenge, and over the last decade have been forced to restructure their operations. The result has been significant downsizing in many operations, with staff reductions and the ensuing elimination of jobs and positions.
The forces of globalisation has created new opportunities, as well as increasing uncertainty. Businesses and job opportunities for those in senior executive positions now show little regard for international borders. Therefore, today’s managers need the skills to conduct business transactions, and manage staff in multiple languages and cultural contexts as Australia continues to become an outward-looking and export-driven nation.
Economic forces have an enormous impact on both businesses and customers. They influence a business’ capacity to compete and customers’ willingness and ability to spend.
Economies do not always experience constant growth. Rather, the level of economic activity changes from periods of growth, known as ‘booms’, and to recession (‘bust’) and back to boom conditions.
Information on economic growth, inflation trends, average weekly earnings, consumer confidence, interest rates, consumer spending and unemployment data provide businesses with insight into economic trends. This information on the level of economic activity allows businesses to predict possible threats to, and opportunities for, business activity.
There have been enormous changes in global financial markets over the past 20 years. Deregulation of Australia’s financial system began in 1983 and it continues to undergo change. This...