Reasons for resistance to change:

Financial costs

• Cost of purchasing new equipment
• Cost of redundancies
• Cost of retraining employees
• Costs associated with structural reorganisation of the business

Purchasing new equipment

Changes in a workplace often necessitate purchasing new equipment, such as new computers. Can lead to:

• Improved processing flexibility
• Improved processing speed and shorter lead times
• More consistency in production
• Higher overall quality of processing
• Reduced wastage and losses from equipment failure

Redundancy payments: money given to employees when they are forced out of their job because their position is no longer required or relevant.

Retraining: arises from change that causes a reorganisation of the business’s internal hierarchy or from the acquisition of technology e.g. computer software.

Reorganising Plant Layout

• Can have high costs associated
• Can lead to loss of productivity when adapting to new work processes

Inertia: describes a psychological resistance to change. A feeling of uncertainty or fear of the unknown, when change is imminent or pressing, can lead people to resist.

Extract from Business Studies Stage 6 Syllabus. © 2010 Board of Studies NSW.