Managing Change (LC 2026) (Leaving Cert Business): Revision Notes
Managing New Technology
Technology continues to transform how businesses operate, affecting everything from daily operations to long-term strategy. Understanding these technological developments and their impacts is crucial for effective management in today's business environment.
Key technological developments
Modern businesses must navigate several significant technological advances that have reshaped the commercial landscape. These developments offer tremendous opportunities but also require careful management and planning.
Artificial intelligence (AI)
Artificial intelligence involves developing computer systems that can perform tasks typically requiring human thinking and decision-making abilities.
- AI encompasses various capabilities including speech recognition, language translation, text-to-speech functions, visual recognition, and data analysis.
- This technology has made education and employment more accessible for people with disabilities.
- Major companies like Microsoft, Google, and Amazon utilise AI to predict customer needs and provide relevant information automatically.
- Chatbots represent a practical application of AI, designed to simulate human conversation and handle initial customer service interactions.
The widespread adoption of AI across industries has created new business models and transformed traditional customer service approaches, making 24/7 support more feasible for companies of all sizes.
Cloud computing
Cloud computing refers to using internet-based servers to store, manage, and process information, allowing access from anywhere with proper authentication.
- Services like Dropbox, Google Drive, and Apple's iCloud enable businesses to store large volumes of data remotely rather than on individual devices.
- This approach provides flexibility and cost-effectiveness, particularly benefiting smaller organisations that may lack extensive IT infrastructure.
Computer-aided design (CAD)
CAD software enables the creation, saving, electronic transmission, and modification of 2D and 3D designs.
- This technology has revolutionised the design process, making product development much quicker and easier.
- Companies can respond rapidly to consumer demands, and CAD finds extensive use in architecture and product design, including automotive industry applications for developing new vehicle models.
Computer-aided manufacturing (CAM)
CAM involves using software to control and monitor manufacturing equipment with the primary goal of creating faster and more precise production processes.
- CAM systems minimise errors and waste in production. When combined with CAD, these technologies can control manufacturing operations performed by robotic machines, welding equipment, and other industrial tools.
- CAM can also manage the movement of materials between different machines throughout the production process, including packaging and final quality checks.
Computer-integrated manufacturing (CIM)
CIM uses computers to control the complete production process from initial design through to finished products.
- This comprehensive system includes design, purchasing, shop floor control, customer order management, and cost accounting.
- CIM finds particular application in automotive, aviation, and shipbuilding industries where complex coordination is essential.
Impact of technology on business operations
Technology has created dramatic changes across all business levels, affecting employees, management, costs, and opportunities available to organisations.
Effects on personnel
Technology has transformed how people work and what skills they need. The modern workplace has evolved significantly, creating both opportunities and challenges for the workforce.
The shift towards technology-driven work environments has fundamentally altered the employer-employee relationship and workplace dynamics across virtually all industries.
- Remote working capabilities: Employees can work from home or alternative locations, reducing travel costs and time whilst increasing flexibility and job satisfaction.
- Enhanced accuracy and efficiency: Technology improves staff ability to make precise assessments and calculations, record transactions, and store information for quick access. Administrative tasks become much faster and more efficient.
- Automation of routine tasks: Computers can handle repetitive and detailed work more efficiently, allowing staff to focus on other responsibilities, such as using EDI systems for stock control.
- Increased skill requirements: Many jobs previously performed by people are now handled by computers or machinery. Workers need higher qualifications and skill levels compared to the past.
- Workforce reduction: Technology may reduce the number of employees needed, including middle management positions. This can save money but may create industrial relations conflicts or damage the organisation's reputation.
- New employment opportunities: Technology has created entirely new job categories, including social media influencers, bloggers, YouTubers, online community managers, programmers, and social media specialists.
- Health and wellbeing concerns: Excessive technology use without proper breaks and inadequate seating or lighting can cause back strain, repetitive stress injuries, or eye damage. Constant connectivity can lead to stress and burnout, potentially increasing absenteeism or causing career changes.
Impact on business costs
Technology affects business expenses in multiple ways, creating both immediate costs and long-term savings opportunities.
- Initial investment costs: New technology represents a significant capital expense. Beyond hardware and software, businesses must factor in installation costs and ongoing maintenance, including regular upgrades and updates.
- Quality improvements: Better product quality reduces costs associated with refunds, repairs, and waste.
- Workforce efficiency: Technological improvements may create redundancies at staff or management levels, reducing wage costs for the business.
- Training expenses: Employees require training on new technology systems. External trainers may need to be hired, which can be expensive.
Business opportunities created by technology
Technology opens up numerous new possibilities for business growth and development, fundamentally changing how companies can operate and compete.
- New products and services: Technological advances have created entirely new industries and markets that didn't previously exist.
- Better decision making: Access to large amounts of data enables faster and more accurate analysis, leading to improved business decisions.
- E-commerce capabilities: Marketing, advertising, sales, and banking can all operate online, expanding reach and reducing traditional limitations.
- Production improvements: Technology enhances product quality, efficiency, and production speed whilst reducing costs through economies of scale. Mobile phones, laptops, and email connectivity all contribute to increased business efficiency.
Benefits and risks of technological developments
Whilst technology offers substantial advantages, managers must understand both the positive and negative aspects to make informed decisions and prepare appropriate contingency plans.
Key benefits
The advantages of technological advancement extend across all areas of business operations, creating value for companies, employees, and customers alike.
- New products and services: Technological advances have created completely new industries, careers, and marketplace opportunities for businesses.
- Enhanced efficiency: New technology enables more efficient product development with fewer faults. CAD and CAM systems, along with ICT, have made communications faster and more efficient.
- Cost reductions: Businesses can achieve savings through reduced staffing needs, less travel, lower retail and rental expenses, decreased postage costs, reduced marketing expenses, and lower banking charges.
Practical Example: Cloud Computing Cost Savings
A small marketing agency with 15 employees previously spent €3,000 annually on server maintenance and €2,000 on software licenses. By moving to cloud-based solutions:
Step 1: Eliminate server maintenance costs
- Previous cost: €3,000 annually
- New cost: €0 (cloud provider handles maintenance)
Step 2: Reduce software licensing costs
- Previous cost: €2,000 annually
- New cost: €1,200 annually (subscription model)
Step 3: Calculate total savings
- Total annual savings: €3,800 (63% reduction in IT costs)
Major risks
Despite the significant benefits, technology implementation carries inherent risks that require careful management and planning.
- Disruption threats: Heavy reliance on technology creates risks of production interruption or complete halt due to power outages, system crashes, or computer viruses.
- Ongoing expenses: Technology requires regular maintenance and becomes obsolete quickly. Repairs, maintenance, and regular equipment or software upgrades must be factored into future business costs.
- Security vulnerabilities: Cybercrime and security breaches pose significant risks. Data theft and cybercrime can be costly, whether businesses purchase security software or hire external security consultants.
Businesses should never rely solely on technology without having backup systems and contingency plans in place. A single system failure can halt operations entirely if proper risk management strategies aren't implemented.
Key Points to Remember:
- Modern technology including AI, cloud computing, CAD, CAM, and CIM has transformed business operations across all industries.
- Technology affects personnel through remote work opportunities, efficiency gains, but also skill requirement changes and potential job displacement.
- Business costs are impacted through initial investment requirements, quality improvements, workforce changes, and training needs.
- New business opportunities emerge through innovative products, better decision-making capabilities, e-commerce, and production efficiency gains.
- Managers must balance the substantial benefits of technology against risks including system disruptions, ongoing costs, and security threats.