Large Scale Organisations

Characteristics
o Employees over 200 people
o The value of its assets is more than $200 million
o Multiple locations, perhaps in serval states or countries
o Lage Scale Organisations will have a board of directors
Different types
o The public sector, is owned by the public
Type Examples Objectives Features Revenue
source
Government Taxation To provide Responsibility lies Government
department Department services. with the relevant revenue-
They are not level of mostly from
Education expected to government taxation
Department make a (local/state/federal)
profit
Government Australia To provide a Essentially owned Primarily
business Post service and by the government from the
enterprise make a they are often self- user-pays
(GBE) Vic Roads profit funded and must service they
manage their own provide
operations
o The private sector
Type Examples Objectives Features Revenue
Source
Private Rip Curl To provide May have up Income from
Company goods or to 50 the sale of
Boost Juice services in the shareholders- goods and
pursuit of not listen on services they
profits the stock provide
exchange. The
sale of shares
must be with
the consent of
other
shareholders.
The business
name is
followed by
Pty Ltd
Public Coles/Myer To provide May have any Income from
Company goods and number of the goods and
Bluescope services in the shareholders, services they
Steel pursuit of and are listed provide
profit on the stock
exchange.
Shares can be
bought and
sold by the
public. The
business name
is followed by
Ltd
 Charities
Type Example Objectives Feature Revenue
Source
Charities Red Cross To raise funds Often called Income from
to be used to not for profit. the various
St Vincent de provide The methods of
Paul services for expectation is fundraising
the needy or that any funds that is
Make A Wish support one raised will be undertaken
Foundation particular used to
cause support the
Starlight stated cause.
Foundation While some
money will be
Heart used to cover
Foundation cost, this must
be kept to a
minimum

Contribution to Australia’s economy

o GDP- Gross Domestic Profit is the value of goods and services produced
within a given time period. LSO are responsibly for 50% of Australia’s GDP.
LSO’s are able to produce more goods and services than smaller organisations
because they can afford to buy the machinery or bulk buy raw materials so that
they can produce their items at a reduced price.
o Employment- Employee over 200 people and keeps the economy ticking
over.
o Balance of Payments- is an account of international transactions. It indicates
how much Australia spends on imports in a given time period and what we
have earned from exports. LSO’s are responsible for much of the exporting
therefore contributes positively to the Balance of Payments.
o Research and Development- Because of the cost involved in undertaking
research and development its often only LSO that can do it
o Infrastructure-

Internal Environments of LSO’s

o Owners and Shareholders- individual shareholders may exert some influence
on the organisation through the board of director’s .eg the merger of Broken
Hill Proprietary Limited and Billiton Limited. Had the majority of consent not
been obtained these 2 companies would not have merged
o Employees- pressure from employees to ensure they work in a safe and non-
discriminatory environment with suitable work conditions. Eg equal
opportunity for men and women.
o Pressure to create a positive corporate culture- is the shared beliefs and values
of an organisation, which can influence the decision making and actions of
managers and employees. Pressure also to incorporate flexibility and
adaptability into their culture to remain dynamic and responsive to a changing
environment.
External Environment
Operating Environment
o Customers- pose potential uncertainty for any business to their profit and on
going success. Eg the customer is always right. Customers have now become
more health conscious, eg Mc Donald’s new healthy choice menu
o Competitor’s- creates pressure through new products and cheaper prices.
They can also offer incentive programs. Eg Safeway petrol
o Lobby and Pressure groups- can attempt to influence the actions of an
organisation. While many focus on environmental issues, others may lobby
for safer working conditions. Eg Anti Cancer Council non-smoking in certain
places and being sun smart.
Macro Environment
Refers to the pressures that an organisation can not control
o Government forces- Government can increase interest rates that can impact
the organisation and the budget can also have an impact.
o Social and Cultural forces- organisations must be aware of and respond to the
changing conditions which impact on society, such as
o Career expectations of women
o Higher education levels and career expectation
o Changing attitude to work
o Environmental Forces- pressure on the organisation to be more
environmentally friendly and aware. Eg mining companies have to be careful
what they do with waste and what chemicals they use.

Evaluation/Assessment of Performance
Key Performance Indicators
Qualitative measures- measures the quality of performance. Eg job satisfaction and
customer service
Quantitative measures- includes measurable indicators such as profit margins and
debt levels
Financial Indicators
o Profit- A successful business would be making a profit or an increasing profit
o Value of sales- The money value of goods and services provided should be
equal or better than the figure anticipated by the business
o Debt/Equity ratio- over time the debt of the organisation would be paid off
and the value of the business would increase
o Share price- determined by the demand of the public. If the share price is
increasing then the business is doing well.
Non-Financial Indicators
o Employee satisfaction- is measured by, staff turnover rates. If staff turnover
is high then it could indicate a problem. Staff absenteeism levels. Low moral
can be reflected in the levels and could also be an indication that working
conditions need to be improved.
o Customer satisfaction- is measured by number or complaints. If the
customer is unhappy with goods or services provided by a business they will
complain, the hight the number of complaints the less satisfied customers are.
Number of customer returns. If an item is faulty customers will return it. If
an organisation is doing things right it will have a low return rate.
o Productivity- is measured by the amount of output by a worker of a given
period of time.
o Market share-
 o Quality -
o Amount of Waste- measures the efficiency of the organisation and doesn’t just
refer to raw materials but also resources including labour and time.

Organisational Objectives
Mission statement
o Is a written document that sets of the reasons for an organisations existence.
Vision statement
o Written document outlining the broad direction the organisation hopes to take
in the future
Value statement
o Written document that outlines what is most important to the organisation in
terms of values and ethics

Strategic Objectives
Required by an organisation as a whole to reach it’s overall purpose. Senior
management will determine the 2 to 5 year goals
Tactical Objectives
Medium term goals, 1 to 2 years and are objectives needed to achieve specific targets
set for a department
Operational Objectives
Are the short-term goals, daily and weekly. An example is a sales manager setting an
objective relating to the sales quota for the next week

Organisational Structure
Is how the work tasks are distributed in an organisation. It highlights roles,
responsibilities, the chain of command and lines of communication.
Function- departments are based on the functions performed. Most organisations, for
instance group employees into one of marketing operations, finance and human
resource departments.
Geographic- departments are often created based on the location of the employees.
For example an organisation may have state or regional branches, a translational
business will have branches based in different countries.
Products- based division are based on the actual product produced by that group of
employees. A sporting goods store for example will have departments such as
footwear, clothing and then specifics types of sport like netball, basketball,
football and tennis.
Customer- based on the type of customer who has special needs. For example a car
manufacturer will have a distinct retail and fleet sales departments.

Span of control
Is the number of people a manger had direct responsibility for, as ser out in the
organisational structure
Informal structure
Is the actual division of responsibilities, tasks, authority and actual lines of
communication that are employed within an organisation
Formal structure
Is the official division of responsibilities, authority, tasks and lines of communication
within the organisation.
Traditional Hierarchical Structure
Senior or executive management
Top level, which has responsibility for strategic planning for the whole organisation.
The board of directors, CEO and executive management fall into this category
Middle management
Managers in charge of a designated department. An example is a store manager for a
large supermarket chain or the manager of a bank branch. They have responsibilities
for tactical decision-making.
Front-line managers
May be referred to as supervisors, team leaders, or a leading hand. They are
responsible for the day-to-day planning and decision-making.

Functional hierarchical structures

Employees are group into department according to the tasks they perform.
Chief executive officer

Manager Manager Manager Manager

Operations finance sales and marketing human resources

Geographic structures
These structures are based on divisions according to location
Chief executive officer

General manager General manager General manager General manager

Australia USA Asia UK

Matrix structures
Involves a team or task force structure where teams are established to complete set
project

Flatter organisational structure

Is the elimination of one or more levels pf management (delayering) in order to
reduce levels in an organisations hierarchy.
Centralised decision-making
Is where management make decisions and pass directions to those below in the
hierarchy. Communication is downward and worker participation in decision-making
is non-existent.

Decentralised decision-making
Is where workers are given responsibility for decision-making in their own areas.

Corporate Culture
Corporate culture si the shared values and beliefs of an organisation which can
influence the actions and decision making-making styles of managers and employees.
Some of the most visible forms of an organisations culture are architecture, décor,
clothing, organisational processes, structures, rituals, symbols and celebration.

Policy
Is a written statement of the processes and procedures, rules and regulations.
External pressure on policy change.
Legislative compliance
Compels an organisation to follow government legislation when developing a policy.
Eg a smoke free environment.
Social responsibility
Involve taking on responsibilities that go beyond making a profit.
International pressures
World diseases, wars all impact policies.
Operating pressures
Lobby groups
Can influence policies. Eg Greenpeace.
Trade unions
Play a pressuring role to develop polices which protect workers.
Internal pressures
Management
Dress code policies
Employees
Policies on flexible work hours. Employee’s pressure organisation to be more
flexible with working hours.

Policy development
Stage 1: Issue identification
o Investigation by employees and management on issues
o Legislative compliance can prompt policy change. Eg health and safety,
sexual harassment.
o Need to develop ‘best practice’ ideas as an organisation sets the standards for
other organisations to follow.
Stage 2: Research and analysis
This involves expert consultants to provide advice or internal risk assessment of
different areas within the organisation. Analysis and discussion of research
material will then follow
Stage 3: Stakeholder input
Stakeholders should be informed of possible changes to policy. This could be done
by posting a summary of the possible policy change or new policy for a particular
time period. Thereby encouraging comment from the stakeholders. The stakeholders
could consist of union officials, non-union employees and representatives of
management.
To gain grater understanding of various viewpoints from other parties, such as
managers, employees and union officials, a meeting should be convened to seek
stakeholder input.
Stage 4: Policy development
The team writing the policy need to comply with the legislative requirements and
should take into consideration the interests of the stakeholders. Once the final draft is
prepared it should be made available for reviews that the senior management can
make comments on the draft.
Stage 5: Draft policy posting
The draft policy is then posted and displayed in a public place-noticeboard, intranet
company newsletter, for a set time period for comments. The notification could
contain advance notice of the intended policy change and provide opportunities for
stakeholders to make comments on the draft.
Stage 6: Policy approval
Feedback needs to be considered so that alterations can be made to the draft. Senior
management would approve the policy for publication and place it on the
organisations intranet or, alternatively, make an announcement and send copies to
employees. Employee training on the policy may need to be delivered by the human
resources department. Autoliv, a car component manufacturer, places their policies
on their website so stakeholder have the opportunity to examine them.
Stage 7: Evaluation
The evaluation measures how well the policy has assisted in achievement of the
organisation’s goals and mission statement. Policy evaluation is important as it
demonstrates whether or not an organisation is stagnant, reactive or proactive in their
bid to respond to change in the organisation should use both qualitive and quantative
measures as part of their evaluation while also gaining feedback for stakeholders.

Procedure
Once policy has been developed, then an organisation needs to establish procedure or
steps to enact the policy. A procedure is usually defined as;
o A series of interrelated steps that are taken to implement the policy
o A written instruction divided into sections with intended headings, which has
clearly defined guidelines. They contain rules of conduct, which may consist
of appropriate language and behaviour or actions.

POLC
Planning
o The 3 types: strategic, tactical and operational
o Swot analysis
o Strengths- examines the internal environment. Eg reputation, service and
branding/name.
o Weaknesses- examines internal environment. Eg poor reputation, weak
market, staff problems and poor structure
 o Opportunities- examines the external environment. Eg globalisation, interest
rates
o Threats- examines external environment. Eg wars, cyclones, droughts,
environmental issues, decline un industry
Organising
An effective manager must be able to organise. Managers are involved in organising
the division of labour, co-ordinating people and resources and ensuring the flow of
information within the organisation
Leading
Leadership is the ability to gain individual or group confidence and empower them to
achieve the organisations goals.
o Legitimate power-power obtained by being appointed by the organisation
o Expert power- can be defined as power that relates to skills, knowledge and
information
o Referent power- when the leader is liked and respected by subordinates, peers
and supervisors
o Reward and coercive power- power that rewards or punishes persons being
influenced.
Controlling
Is directly linked to planing. Controlling processes ensure that plans are being
implemented appropriately and alerts managers to any deviations from the plan so
corrective action may be instigated. Controlling involves establishing performance
standards, which are based on the organisational objectives.
o They will measure and report actual performance compared to forecasts.

Management Styles
Autocratic
Is a manager who likes control and authority, has a high regard for production and
efficiency and low concern for employees. Communication is downward.
Advantages
o Direct communication from senior management to lower levels
o Employee roles and expectations are defined and monitored
Disadvantages
o Team work is not encouraged
o Low motivation and job satisfaction as lower employees have no
responsibility
Persuasive
Occurs when a manager makes a decision and then tries to convince the employees
that what they have decided is in their best interest. This type of manager will try and
change everyone’s view, but will also stick to their decision. Communication is
downward.
Advantages
o Have a clear idea of what to do when change is occurring
o Managers has clear expectations
Disadvantages
o Low team work
o Power is centralised
Consultative
Is when the manager listens to the opinions of the team members before making a
decision. Communication is 2 way.
Advantages
o A variety of ideas are suggested by employees
 o Reasonable employee involvement
Disadvantages
o Time consuming as all team members are consulted
o Overlooking some ideas may cause conflict and ill feeling among employees
Participative/Democratic
Is when a manger shares the decision-making with group members, but ultimately the
leader makes the decision. Communication is 2 way.
Advantages
o Open communication within the organisation
o A diversity of viewpoints are evident
Disadvantages
o Conflict can emerge with diverse viewpoints or stakeholder interests
o Compromises are made in the decision making process rather than being clear
and sound, due to different opinions
Laissez-faire
Is when a manager has little control over their group, leaving them to sort out roles
and tackle their work without participating in the process themselves.
Communication is upward
Advantages
o High employee orientation as employees can set their own tasks with little
involvement from management
o Strong motivation, empowerment and job satisfaction since employees are
encouraged to be creative and innovative
Disadvantages
o Little guidance could be problematic for employees who are not highly
motivated
Situational or contingency
Is when a management style is implemented according to the situation.

Management Skills
Communication
Is required by management for achieving their functions
o Written communication- expresses thoughts and ideas, information and
messages via e-mail, word processing and documents and reports.
o Listening- if managers do not listen they may not hear suggestions or
information from the most valuable employees
o Verbal communication- enables the manager to organise their ideas and share
their vision with employees.
Visionary skills
A manager with visionary skills gives meaningful direction to an organisation.
Strategic planners are:
o A manager who can see the big picture for organisational growth
o A manager, who looks forward and learns from past activities, can anticipate
and be prepared for the future. They give the organisation a sense of direction
Problem solving
Involves identifying problems, then devising and implementing an action plan.
1. Identify- the problems and objectives
2. Gather- necessary information to establish the cause of the problem
3. Develop- alternative solutions
4. Rank- the alternatives and select the best one
5. Implement- the best alternative
6. Evaluate- the implementation.
Decision-making
Relates to the objectives of an organisation. Decisions are made on a daily basis.
Managers will examine the issue, look at the alternatives, consider the short and long
term risks, evaluate the alternatives and choose the best solution.
Delegation
Is when a manager gives authority to an employee to complete a set task. One
problem with delegation is that when the manager gives authority a manager may lose
control.
Teamwork
Encourages shared vision and objectives. Is when 2 or more people work on the same
task. Employees are more likely to share the vision and objectives of an organisation
if they participate as a team. Teamwork encourages open communication, improves
morale, culture and workplace cooperation.
Technical skills
Are required to chose, modify and troubleshoot technology for the organisation
Competencies
Can be defined as clusters of skills and attitudes that are used by a manger in order to
achieve performance on the job. These can be measured against accepted standards
and can be improved through training and development.

Operations Management
INPUTS, PROCESSES, OUTPUTS.
An example is Rip Curl.
Inputs- facilities, design studios, clothes factory, printing factory, warehouse,
machinery, fabric, packaging, electricity, skills and employees.
Processes- creating design, preparing patterns, cutting, bunderling, sewing, quality
check, printing and transport.
Output- A t-shirt

Their facilities and design is a spacious, smooth flowing assembly line. They uses the
just-in-time method for their materials management, which relies on a good
relationship with their supplier, this comes from paying money on time. They check
their supples with many test and their processes such as sewing and printing, as part
of their quality management. They use technology in the form of CAD computer
aided design and CAM computer aided manufacturing.

Strategies
Facilities, design and layout
This involves planning and mapping out the actual physical set up of all equipment
and technology within the plant.
The following must be taken into account in designing the layout
o Provision of sufficient space to allow for effective and smooth workflows
o Provision of the best technology for that workplace
o Sequencing of tasks so there is a minimisation of wastes and backtracking
between each stage
o Best use of equipment
o Locating equipment, stock and inventory in the best place so they are easily
accessible and do not interrupt workflows
o Safe work environment
o Conforming with legal requirements
Fixed position layout
Is when the product remains in one location while being built or constructed. All the
labour and resources are brought to it. This type of layout is used for the construction
of large, bulky products such as aeroplanes.
Process/functional layout
Pieces of equipment with like function are all grouped together. It is used with
products that require a large amount of variety but are produced in small amounts.
A hospital would use a process layout. Each patient will have different needs and
requirements, therefore they will utilise different machinery and locations with no set
pattern.
Production layout
This type of layout is generally used when employing mass production techniques that
create large amounts of consistent quality products. Generally, the products move to
the equipment along a conveyor belt.
Retail layout
Of retail store is critical to success. The layout has to have the aim of attracting
customers and encouraging easy flow or channelling throughout the store

Office layout
Should be designed to allow for easy flow of traffic, optimisation of space and easy
movement of information.

Materials Management
Materials include:
o Raw materials, supples and parts
o Work-in-progress, unfinished work
o Finished work, not yet delivered
o Spare parts for machinery

Material strategies
Master Production Schedule, MPS
Is the starting point to plan the materials that are needed. It covers
o What to produce
o How much, volume
o Production methods
o When to produce
o Where to produce
o Staff needed
Materials Requirement Plant, MRP
Are the specifics, such as:
o Specific materials required
o Exact quantities
o Best time to order from suppliers
o Best delivery times
Inventory Control
Is an organisations stock of materials. It is essential because:
o Stock that is idle or expensive tie up funds for no return as well as taking up
valuable space.
o You cannot run out of materials as it delays or even shuts down which is very
costly.

Quality Management
Quality Control
Is the use of physical checks at different stages of the production process to ensure
that products meet designated standards and that errors are eliminated post
production.
Quality Assurance
Aims to build quality into the work processes, therefore avoiding errors before they
occur. It involves the use of an external organisation, a “certification body” who
audit against national or international standards. The achievement of certification
entitles the organisation to display certification marks. SAI Global is the best
known Australian body that issues certification against ISO standards.
Total Quality Management
A holistic approach to quality where all members of a company aim to participate in
ongoing improvements to the companies culture and production processes. It
involves:
o Continuous process improvement
o Customer focus
o Defect prevention
o Universal responsibility

Technology
Computer aided design- CAD designers work with computers to design and create
products
Computer aided manufacturing- CAM is when computers are used to control the
production process.
Robots- computerised machines are used to do various tasks in the production
process.
Electronic data exchange- computer to computer exchanges of data. Eg suppliers.
Services
o Computer used in offices
o E-commerce
o E-mail
o Mobile phones

Human Resource Management

The role of a HRM
Focuses on obtaining, training and manufacturing an efficient and effective workforce
capable of achieving organisational goals and objectives.

Motivation
Is the drive to achieve a goal. It is the willingness to exert high levels of effort to
reach organisational goals.
MASLOW’S THEORY OF MOTIVATION
A five stage hierarchy of needs based on importance. Each level of needs acts as a
motivator, once one level has been met the next level acts as a motivator.

5.Physiological needs- Basic needs such as shelter, food, etc. With work it is basic
conditions and pay.
4.Safety- Job security, permanent, full-time, safe and healthy conditions, harassment
and bullying.
3.Social needs- Acceptance, friendship, organised work activities, birthdays etc.
2.Self-esteem- Recognition, responsibilities, promotion, status of position.
1.Self-actualisation- Work allowing creativity opportunities for personal growth.

Reward Motivator- financial

o Wages and salaries
o Commission
o Salary packages
o Superannuation salary sacrifice paid in before tax. Taxed on what is left
o Performance related bonuses
o Employee share purchases
o Profit sharing
Non-financial
o Promotion
o Special projects
o Career development
o Study leave
o Recognition
o Fringe benefits
o Job title
o Travel

Employment Cycle
Establishment phase
Is the planing to ensure adequate supply of competent and motivated people are
available to perform the duties and tasks required to meet organisational objectives.
Job analysis
Is the systematic process of gathering info relating to a job being performed
Job Description
Written description of the tasks, activities and responsibilities of a job.
Job Specification
Lists the skills and attributes required for a particular job. Eg experience, education,
training, skills and special requirements.
Recruitment
Identifying, locating and attracting the right pool of applicants for the right position.
The process begins with identifying the HR requirements. It’s the role of the HR to
ensure that the people recruited and selected have the skills and attributes required.
Determining where applicants can be found can be done internally via intranet,
memos or direct approach from HRM or externally from advertising, Internet, job
agencies and universities.
Advantages of internal recruitment
o Quicker adjustment to the position
o Incentive for employees to advance in career
o Motivator and morale booster
o Organisation knows applicant and the applicant knows the organisation
Disadvantages
o Employees may be promoted beyond competency levels
o No new ideas introduced
o Negative impact on unsuccessful applicants
o Poor work habits remain
Advantages of external recruitment
o Large pool of applicants
o New insights, skills and abilities brought to the organisation
o Lower costs
o New approach to work, issues and problems
Disadvantages
o Time consuming and difficult
o Limits career advancement of existing employees
o Great risk as new employee is “unknown” person
o Costly form of recruitment
Maintaining
Important for organisations to retain productive and efficient employees who are loyal
and committed. To do this they must have:
1. Good employee arrangements
2. Induction programs
3. Training and development
4. Performance management

Induction
Involves all the activities undertaken by the organisation to introduce a new employee
to the organisation. The length of the induction can last up to several days.
The main purposes is to commence the socialisation process, communicate the
organisational values, beliefs and expectations, provide information about job tasks
and performance expectations and create a favourable impression about the
organisation. The induction process reduces staff turnover and means new employees
will become effective and reach expected performance levels more quickly.

Training
Is the process where an employee gains the knowledge and specific skills required to
perform their task, development however is designed to build up skills necessary for
future work activities and responsibilities.

Performance management

Termination
The situation where an employee leaves the organisation by either resignation,
redundancy, retrenchment, retirement or dismissal.
Resignation
Employee chooses to leave often because they have another job lined up. Exit
interviews are often held to find the reason for the resignation.
Redundancy
INVOLUNTARY- there is no longer a position, the organisation no longer requires
the employee
VOLUNTARY- organisation offers redundancy packages to those who wish to take
them
Retrenchment
The organisation lets goo of the employee but the decision is usually based on the
financial needs of the organisation.
Retirement
When an employee decides it’s the end of their working life.
Dismissal
When an employee is fired.

6 situations where an employee cannot be fired

1. Temporary absence from work due to illness or injury
2. Holding membership of a union or participation in union activities
3. Not holding a membership to the union
4. Participating in proceedings against an employer for alleged violations or
regulations
5. On race, colour, sex, sexual preference, age, physical disability, mental ability,
marital status, family responsibility, pregnancy, religion, political opinions or
social origin.
6. Absence during maternity or other parental leave

Change
Is the process of altering an organisation and establishing a new form. Change occurs
because of pressures placed on the organisation to make adjustments to its structures,
activities, policies, behaviours, processes and culture.

Causes of change
Customers- are critical to the existence and success of an organisation. Any
organisation that is not customer focused will find customers wont return. Its up to
the organisation to keep up to date with tastes and requirements of customers
Competitors- a business must ensure that they can out perform its competitors.
Organisations will also have to make changes to stay ahead of competitors.
Suppliers- provides the organisation with inputs needed to produce a product or
service. Organisations can have production halted by an issue outside their control.
Unions- represents employees in the workplace-handling grievance, discerning
information, recruitment new members and dealing with management. Trade unions
may lead to pressure for change in the organisation particularly in terms of enterprise
agreements.

Kurt Lewin

3 phase change process

1. Unfreezing the status quo
You must change the current position of the organisation before being able to
move to the new structure. This involves:
o Preparing the business and employees for change
o Outlining reasons for change
o Reducing resistance to change
2. Moving to the new state
The new procedures, systems and behaviours must be identified, communicated,
modelled and practiced.
3. Refreeze in the new position
 Once implemented it is necessary to ensure the changes are permanent. This
involves:
o Re-enforcing the change
o Promoting reward and recognition of employees

Low risk strategies for change

o Communication must be 2 way, open and honest
o Identify and explain the need for change
o People must be helped through the change. Managers must give support by
training employees for new skills and monitoring stress levels
o Employees must be involved in the change process, as they are less likely to
resist something they are apart of
o Negotiations- agreements can be struck to ensure support of the change
High risk
o Manipulation, management selectively withhold information to make it appear
more favourable than normal
o Threats against those who resist change including retrenchments, transfers and
demotion.

Privatisation.
Is the sale or transfer of government enterprises from the public sector to the private
sector.
Methods of privatisation.
1. Share offer- shares in the former government business
enterprise are incorporated into a company structure are
offered to the general public by the way of a public float.
Potential shareholders subscribe to these shares by way of
application form.
2. Public tender and direct negotiations- the government
advises GBE in a position to move to the private sectors.
Organisations are encouraged to place a bid for the purchase
of the entire organisation. The government awards the tender
to the highest bidder or to whom they believe can best deliver
the service.