4.1 – What is Change?

change is part of everyday life for international businesses

huge changes in information technology and telecommunications

How different have our lives been due to technology?

Business still out to make a profit with a changing marketplace

Some businesses don’t survive change

Others take advantage and become successful

3 causes of change: new technology, new processes, new attitudes

inventions: are totally new products that are based on a creative idea

innovations: are modifications to an invention that take the inventor’s initial concept even further

Phone -> invention Cell phone -> innovation Digital technology -> invention that

brought about cell phone

technological change can occur on a grand scale or on a smaller scale• ATM -> grand scale• Resealable chip bags -> smaller scale

patent registration protects the invention for the owner and offers exclusive use/rights

inventor can licence the invention and/or sell the new product to others

patents, copyrights, and licences are valuable property

inventors often partner with other companies

process change, often initiated by technological change, takes place in manufacturing, distribution, inventory control, accounting, and marketing

manufacturing: change in the way something is made - faster, better, less expensive

distribution: electronically - e-mail, Internet, web sites have eliminated need for intermediaries, wholesalers, importers, retailers

Now on-line catalogue distribution methods, easier transportation of products and business papers by such high technology companies as Federal Express

Inventory control: manually done to electronically linked; used by suppliers, customers

Just-in-time - an inventory control system that schedules products to arrive as they are needed for manufacturing or for supply to customers, strong relationship needed by purchaser and supplier

Kanban is a Japanese philosophy that has as a major principle the elimination of waste, especially wasted time, labour, and resources (similar to JIT)

Accounting: new accounting systems and software allow for instantaneous reporting of profit, inventory, investment, and other financial data; know precise information from all stores-departments-plants; online inventory management

Marketing: • primarily process changes• big box retailers (category killers), power centres• smaller retailer becoming more specialized• data mining (examining your credit purchases,

bank card records, loyalty cards) is a way of connecting specific customer characteristics to their purchases - predict when a customer will need a product

• target marketing and distribution information; promotional activities; coupons, contests, and other sales promotion methods target customers

Changes in values equals changes in purchases

Environmental awareness; concern for our health; social conscience; trends or fads or long-term and lasting in the marketplace;