Business Management Quiz

1. Business Management Quiz Unit 4 Management of Change

2. Question 1 List five external sources that drive organisational change. Answer Economic Geographic Social Legal Political

3. Question 2 Explain how Economic forces can have a direct impact on change within an organisation. Give at least three examples relating to economic forces. Answers Economic forces have a direct impact on all organisations operating within the current economic conditions. Inflation Interest Rates Consumer spending Currency rate Global Economic Recession

4. Question 3 Explain how Legal forces can have a direct impact on change within an organisation. Give at least three examples relating to legal forces. Answers This relates to a change in the law either by Federal, State or Local Council by-laws Industrial Relations Laws Occupational Health & Safety Laws Equal Opportunity Laws Environmental laws such as the Carbon Emissions Trading Scheme. Restrictions in Advertising eg tobacco & alcohol

5. Question 4 Explain how Geographic forces can have a direct impact on change within an organisation. Give at least three examples relating to geographic forces. Answer Geographic forces is when an organisation is affected by extreme weather conditions. Extreme weather eg drought or flood Water restrictions Carbon emissions Pollution Land degradation

6. Question 5 Explain how Social forces can have a direct impact on change within an organisation. Give at least three examples relating to social forces. Answer Social forces can be explained when consumers expectations change. Fashion Trends New trends & cultural change Carbon emissions Healthy lifestyles Changing expectations of customers

7. Question 6 Explain how Political forces can have a direct impact on change within an organisation. Give at least three examples relating to political forces. Answer Political forces can be explained when federal, state or local governments intervene in the market place to support organisations which will benefit the economy or impose restrictions on organisations that may have a detrimental effect on the economy or community. Government assistance in certain industries. Government assistance in training Govt assistance in employing long term unemployed. Restrictions on opening and closing hours.

8. Question 7 Explain how Technological forces can have a direct impact on change within an organisation. Give at least three examples relating to technological forces. Answer Technological forces are when new technology is introduced into an organisation to improve it’s efficiency and effectiveness or their operations. On-line shopping Robots replacing people in repetitive and boring jobs. Instant communication through sms messages for advertising. Social networking web sites such as Facebook, Twitter and You tube.

9. Question 8 Internal forces have just as much impact on an organisations operations as external forces, however an organisation does have some control over these types of changes. List six internal forces of change. Answers Corporate Culture New Management Styles Management Skills Stakeholders (shareholders, suppliers, competitiors) Changing employee expectations New policies.

10. Question 9 Give an example of change relating to Corporate Culture. Answers Change in the way people present themselves to their customers eg. Dress code, telephone etiquette, customer service code of conduct.

11. Question 10 Give an example of change relating to new management style. Answers A new participative or consultative style of management may include more meetings to gauge employees ideas on situations. A more autocratic style of management may include no consultation which may result in employees lower down the hierarchy not having any impact on decisions made.

12. Question 11 Give an example of change relating to management skills. Answers A new manager that does not possess leadership skills may have to rely on delegation which includes giving more power or consulting more with lower level managers.

13. Question 12 Give an example of change relating to stakeholders. Answers A change that may occur relating to stakeholders could be a change in ownership if a major individual or organisation purchased a majority of shares in the organisation. This would result in a merger or takeover. A change that may occur relating to a supplier may be if a supplier goes out of business then the organisation will have to source another supplier. A change that may occur relating to a new competitor could be a loss of customers and market share.

14. Question 13 Give an example of new policies that may affect change within an organisation. Answers An example of new policies that may affect change within an organisation might be the a policy relating to using environmentally friendly products within the organisation, or installing energy saving procedures such as turning lights off when rooms are not in use.

15. Question 13 Give an example of changing employee expectations. Answers A change that may occur due to changing employee expectations could be loss of skilled employees if they are dissatisfied with the workplace. It may also be a problem if an organisations reputation is such that new employees will not apply for positions if the workplace situation is not adequate.

16. Question 14 Give a definition of driving forces that create pressure to change. Answers A driving force that creates pressure to change are those forces that enable an organisation to move towards its set objectives.

17. Question 15 Give a definition of restraining forces that create pressure to change. Answers A restraining forces is a force that restricts change or prevents it from happening.

18. Question 16 Give nine (9) examples of a driving force that creates change. Answers Effective management Technology New Employees Good Communication Global Markets Change Agents Competitors Legislation Low productivity

19. Question 17 Give nine (9) examples of a restraining forces that restrict change. Answers Costs Existing Corporate Culture Time Lack of resources Resistance from employees Poor communication Poor management Organisational inertia Low productivity

20. Question 18 Name the 8 Steps that underlie Kotter’s theory on change management. Answers Establish a sense of urgency Form a powerful guiding team Create a vision Communicate that vision Empower staff to act on the vision Plan for and celebrate short-term successes Consolidate improvements Institutionalise new behaviour

21. Question 19 Identify at lease three low-risk and three high-risk practices that can be used as strategies for effective change management. • Answers • Low risk strategies include, communication and education & participation • 2. High risk strategies include, negotiation and coercion.

22. Question 20 Categorise the following as low risk or high risk practices when determining strategies to use in the change management process. Speaking to employers on a one-to-one basis regarding change. Communicating via emails, texts, reports and letters. Using a participative style of management and delegate some decision making authority. Supporting employees through the changes by using active listening to problems and monitoring the level of dystress. Negotiating agreements and offering incentives for employees to accept change. Manipulating figures to support the change process or starting rumours to influence change. Using direct threats against those who resist change.

23. Question 20 - Answers Categorise the following as low risk or high risk practices when determining strategies to use in the change management process. Speaking to employers on a one-to-one basis regarding change. Low Risk Communicating via emails, texts, reports and letters. Low Risk Using a participative style of management and delegate some decision making authority. Low Risk Supporting employees through the changes by using active listening to problems and monitoring the level of dystress. Low Risk Negotiating agreements and offering incentives for employees to accept change. High Risk Manipulating figures to support the change process or starting rumours to influence change. High Risk Using direct threats against those who resist change. High Risk

24. Question 21 Identify seven (7) significant issues that can affect large scale organisations. Answers 1. Social responsibility Business ethics and corporate governance Globalisation Mergers and Acquisitions Technological Development Legislative compliance Privatisation.

25. Question 22 Explain with an example how community attitudes put pressure on organisations to be better corporate citizens. Answers The reputation of an organisation can affect its profitability if it does not ‘do the right thing’ by the values of the community. Examples of this are ‘News Corp’ Rupert Murdoch’s media organisation is in crisis at the present due to a scandal involving tapping into private citizen’s text messages and phone records. Alcoa supports community projects by allowing their employees to work in the community one day a month. Compare this with the negative feedback coming from parents of children attending Anglesea Primary School where it is inferred that Alcoa is polluting the air children breath at the new school location.

26. Question 23 Explain with an example how ‘business ethics and corporate governance put pressure on organisations to be honest and transparent in their operations. Answers ‘Doing the right thing’. An example of ‘News Corporation’ owned by Rupert Murdoch reporting on others not doing the right thing when they themselves were tapping into private citizens phone records. Corporate Governance is where laws and regulations are set down by the administrators to control everyone working for the organisation. Everyone is accountable and there are appropriate checks and balances in place to avoid unethical or unlawful activities taking place. Eg Accounting standards must be complied with but reports accompanying the financial records must not be misleading giving a more favourable view of the reports than what is actually occurring.

27. Question 24 Explain with an example how globalisation can have an impact of changing an organisations operations. Answers Organisations today with the introduction of new communication technology are able to operate effectively in a world market. 1. Contact with different cultures and business customs 2. Different currencies 3. Different legal and political systems 4. New technology 5. International recruitment 6. International social responsibility.

28. Question 25 List five Australian organisations that have gone global. Answers BHP Billiton Brambles Lend Lease National Australia Bank Telstra

29. Question 26 Explain how Mergers and Acquisitions affect change within an organisation. Answers A merger is when two or more organisations join together to become one large organisation. An acquisition is when one organisation purchases another by buying a controlling interest in its shares. Sometimes referred to as a takeover.

30. Question 27 Explain the benefits of a merger or acquisition to an organisation. Answers Economies of scale – this allows an organisation to lower its production costs. Increased market share and access to new product markets. Geographical expansion – can include access to foreign markets Upgraded expertise – can also target organisations to acquire knowledge or technical expertise needed for expansion. Lower cost of expansion – buying another organisation is often cheaper than growing internally. Defence – protects themselves against a takeover.

31. Question 27 Explain with an example how technological developments can affect change within an organisation. Answers Advances in technology have impacted greatly on organisations over the past few years. E-commerce is emerging an important aspect of an organisation business with more and more consumers shopping on line. New technology brings with it the need for an organisation to change its current work practices and learn new skills. Security is an issue with e-commerce and consumers need to have faith in the security of their information. Technology can also lower production costs and the quality of a product.

32. Question 28 Explain with an example how legislative compliance can affect change within an organisation. Answers Laws passed by Acts of Parliament by State and Federal governments have had a huge impact on organisations. Laws that have been introduced over the past few years that organisations have had to comply with are: Employee/industrial relations Superannuation Equal employment opportunity (covers sexual harassment) Affirmative action (Attempts to redress discrimination in the workforce.) Occupational Health & Safety Financial Accountability Taxation Restrictive trade practices (includes anti-competitive behaviour). Consumer protection Privacy Environment protection

33. Question 29 Explain with an example how privatisation can affect change within an organisation. Answers The term privatisation is used when a government owned business is sold to the private sector. An example of this was: Commonwealth Bank Telstra Qantas The transport system in Victoria – trains, trams, buses. The new privatised business becomes more focussed on profit and cost cutting than when the government owned the business as they were more interested in providing a community service.

34. Question 30 Describe characteristics of an effective leader in managing change. Answers An effective leader has the following characteristics: . Has a clear understanding of the change . Can communicate this understanding to staff . They provide a vision through strategic planning and communicate this down the line. . Acts as a good role model by exhibiting the desired behaviour. . Able to maintain motivation levels among employees.

35. Question 31 Identify the two functions of an organisation where change will have an impact on the internal operations of an organisation. Answers The management of the operating process And The management of the human resources.

36. Question 32 Identify the elements of the operations process in an organisation. Answers Inputs Processes Outputs

37. Question 33 Give an example of a change that might affect the operations process of an organisation. Answers Water restrictions imposed on organisations affected change within organisations reliant on using water in their processing of their product. New Equipment, tanks, recycle equipment. The use of Robotics in the manufacturing process of vehicles has meant job reduction and new job roles created to maintain the robotics. Also has increased productivity allowing production to operate continuously with no sick leave, holidays, lunch breaks etc. Outsourcing part of the production process can also change the operations process. Less staff, loss of quality control, introducing just-in-time materials management.

38. Question 34 Give an example of a change that might affect the management of human resources in an organisation. Answers 1. Management of employees when facing job losses, communication. 2. Managing the termination of employees. 3. Modification of jobs to suit the new processes eg training 4. Preparation of employees to the changes types of skills that will be needed. 5. Recruitment of new staff to carryout the change in job roles, skills and expertise. 6. Maintaining the culture of the organisation. 7. Recognising and rewarding staff in the process of change. 8. Changing organisation objectives will influence the goals and objectives down the line. 9. A change in the management structure of the organisation.