The Constantly Changing Business Environment
The business environment is constantly evolving, and managers are struggling to make decisions that have a lasting impact. World's leading business entities have been lagging behind in sectors where they once dominated. It is hard for the status quo to be maintained in the business community (Morrison 2011, p. 58). It is essential for the managers to adopt strategies that allow the institutions to evolve and cope with the challenges caused by the dynamic world. The survival of any entity depends on the strategies employed by the management to adapt to the unanticipated challenges. The primary focus of this paper is to examine the survival of business entities amid the drastic changes experienced in the sector.
The companies need to change faster than the environment in which they operate for them to survive. The institutional leadership should embrace a method that allows the decision makers of the entity to make drastic positive decisions (Smith 2013, p. 33). These drastic decisions can save a company in the face of business storms. It is crucial for the management to adequately understand the internal and external environment of a particular business before making a decision. Several changes exist that require companies to embrace rapid changes. The most common driver of change in the business world is technology as well as the increase in the power of information processing. Technologies have changed the business landscape.
The most important aspect in a time of constant changes is to focus on the challenge and the response time needed. The management must ensure that all the departments of an institution can implement the proposed changes. Additionally, they need to understand the causes of resistance to the evolution within the business entities. Apart from changes brought about by the technology, changes in the management, as well as government policies, have an impact on business entities (Morrison 2011, p. 159). The change in technology is regarded as the most frequent change driver. Therefore, response to changes as well as adaptation is crucial for the development of business entities.
The method of responding to change can also influence the success of a given business. Various companies respond to the evolution in different ways. These changes may take many forms leading to the creation of new challenges. Some of the changes include a shift in customer preferences, the introduction of new methods of supply of materials, as well as the emergence of a new rival product. In these cases, it is crucial for the management as well as employees to understand their particular roles in responding to an impending change. The variations in the industries require answers from the management. The intensification of competition coupled with the rapid changes leads to the collapse of some companies.
It is vital for an institution to engage in institutional change for purposes of survival. Management of change and transformation has become necessary components to businesses. Strategic management can also be called change management since it involves anticipating change. In most cases, managers fail to correctly anticipate and identify shifts in the business environment (Jiang 2014, p. 86). Failure to notice changes in a company's setting may be detrimental to decision-making in the firm. Besides, there are certain factors in business entities that affect the ability of managers to identify environmental changes.
Business entities need to improve their change detection system to avoid a long and tedious change processes. Capacity to recognize and anticipate change is the primary ingredient for efficiency in the management of change. In particular cases, managers often ignore the impact of certain seemingly small changes. All changes in the business environment should be accorded the attention they deserve. However, some managers correctly identify changes but fail to institute proper strategies for the adaptation of the business to change.
Most managers are heavily committed to the current activities of their various businesses. In essence, they become blinded and unable to see the impending changes in their company's environment. Changes may occur in the firm, but the managers just fail to notice them (Reuvid 2011, p. 114). They are often concerned with their ongoing strategies than the future of the companies. The managers only see the changes after their great impact on the operations of the business. Most of the changes identified in this manner often have sudden, significant, or catastrophic effects on the institutions.
Other managers may be able to detect the changes but fail to employ strategies or responses to curb the threats posed by the dramatic changes (Jiang 2014, p. 86). For instance, Kodak noticed the introduction of other dry cells into the market that it dominated but failed to counter the rival products. Some businesses are not suited to change. They are unable to learn from past changes. Such institutions usually struggle to adopt new strategies even though they notice the changes. Institutional learning is crucial for the adaptation of a business entity to the environmental changes.
Learning in an institution occurs at two distinct levels. The lower and higher learning levels enable business entities to learn from their past changes (Argote 2012, p. 31). Lower level learning is essential in the refinement or improvement of existing understanding, beliefs, as well as company processes. The higher-level learning ensures that new ideas, as well as procedures, are developed to ensure the business is aligned to the dynamic business environment. Lower level learning assists that company in the reduction of the costs per unit. Additionally, it leads to the increase in the cumulative output of the business.
The managers must often work towards ensuring that the companies are relevant. Additionally, it is essential for them to adopt a two-way communication approach. This enables the employees to communicate any changes detected. These business changes that offer challenging environment are also vital. They assist the business entities in developing innovative ideas for the dynamic world (Jiang 2014, p. 87). The changes can be occasioned by the changes in the needs of the stakeholders as well as clients. The strategies to be adopted should be reviewed through the ‘lenses’ of the customers and stakeholders. The past choices may not be relevant in the dynamic world but can be used as reference points. It is essential for the managers to prepare for the evolution of their strategies to suit their desired targets.
Taking a balanced approach when tackling changes is important to ensure that the company values are kept in addition to proper strategies. The management should avoid reckless actions with a potential to negatively affect the company (Smith 2013, p. 67). Response to variations in the business environment in a disciplined and systematic manner can give a particular firm a competitive advantage over the rivals. Balancing profits, growth, cost, and value are essential to the long-term decision making as well as response to certain changes.
Communication is a key component of all change processes. Since the business world is constantly evolving, the management has to communicate to the stakeholders regarding their strategies (Dwyer 2012, p. 143). Inadequate or lack of information can lead to negative rumors. These rumors may result in reduced engagement of the employees. It can also lead to loss of trust and strained relationships between the employee and the management. The communication of changes in the business involves certain steps. It is essential for the management to acknowledge the impending changes as well as challenges (De Silva2013, p. 71). These must be communicated to the employees effectively and promptly. Besides, the management should also share the strategies to be employed in dealing with the challenges. It is also essential to inform the stakeholders as well as clients how the strategy can adapt over time.
Moreover, the manager can ask for supportive ideas to ensure the company stays on track in the dynamic world. The steps assist leaders in the maintenance of confidence as well as trust. The development of the leadership of a given institution is a major key to adapting to the business environment. The leadership must be aware of the strategies that can be used to ensure business survival (Smith 2013, p. 34). Employing appropriate strategies enable institutions to succeed despite the dynamism experienced in the market.
In summary, the success of business entities in the dynamic business environment depends on detection of change as well as the time taken to respond to a given change agent. Therefore, it is crucial for leaders to strive for a relevant and balanced approach to the shifts in the institutions.
References
Argote, L., 2012. Organisational Learning: Creating, Retaining, and Transferring Knowledge. Berlin: Springer Science & Business Media.
De Silva, T., 2013. Essential Management Skills for Pharmacy and Business Managers. Boca Raton: CRC Press.
Dwyer, J., 2012. Communication for Business and the Professions: Strategie s and Skills. New York: Pearson Higher Education AU.
Jiang, W., 2014. Business Partnerships and Organizational Performance: The Role of Resources and Capabilities. Berlin: Springer Science & Business Media.
Morrison, J., 2011. The Global Business Environment: Meeting the Challenges. London: Palgrave Macmillan.
Reuvid, J., 2010. Managing Business Risk: A Practical Guide to Protecting your Business. New Delhi: Kogan Page Publishers.
Smith, P.A. ed., 2013. Dynamic Leadership Models for Global Business: Enhancing Digitally Connected Environments: Enhancing Digitally Connected Environments. Hershey: IGI Global.
