F1

Designed to give you knowledge and application of: Section B: Key environmental influences & constraints on business & accounting B1. Political & legal factors B2. Macro-economic factors B3. Social & demographic factors B4. Technological factors B5. Competitive factors

Learning Outcomes B3 and B4 : Social & demographic factors and Technological factors  Effects of social & demographic trends  Impact of social changes on organisation  Government measures in response to demographic changes  Effects of technological changes  Impact of information technology and information systems development

Reflect the status of how people live together (e.g. married couples) These demographic factors change over the course of time. Level & rate of changes will determine extent to which society changes. Extent to which society changes, determines extent to which demand for types of goods & services changes. Organisations need to monitor society and continually track these changes Nature of a society is influenced by its demographic factors Population size (total number of people) Age groups (e.g. number of teenagers, adults etc) Education levels (e.g. number of school leavers, university graduates etc.) Household patterns Population growth rate (speed at which population is increasing) Effects of social and demographic trends Refer to Examples on pages 156,157 & 158

Demand for goods / services affected by change in society’s Social structure: (class system of society) Values Attitudes Tastes Example: people tend to spend more on luxury goods as they move up a class Example: people today like to buy goods from organisations with an ethical reputation Example: consumers today demand products/services that offer high value Example: societies are becoming more health conscious; this has increased the demand for low cholesterol food NO Impact of social changes on the organisation

Governments attempt to attain Optimum population size Optimum population growth rates Optimum social structure Increasing education levels across all society Large enough to produce required goods / services whilst not being a drain on resources Rate required for a population to reach its optimum size Least disparities in wealth between different classes Government measures in response to demographic changes

Improved automated processes Improved productivity per worker Enable organisations to reduce their workforce DOWNSIZING (occurs when an organisation no longer requires a large number of its employees) Technological advances Effects of technological changes

Spread of IT & IS across organisations Enable organisations to:  better communicate with employees  have a wider span of control DELAYERING (occurs when an organisation reduces its number of managerial layers) Technological advances Effects of technological changes Refer to Example on page 165

Growth and spread of internet Boom in telecommunications industry Enable organisations to better monitor and communicate with external parties OUTSOURCING (occurs when certain activities / functions of an organisation are contracted out to an external party) Technological advances Entity on one side of the globe Accounts outsourced to an entity on the other side of the globe Refer to Test Yourself 1 on page 166 Continued…

Information technology & information Systems Facilitate exchange of information across the organisation Allow information to flow more accurately and quickly Allow departments not only to better perform their functions but also to grow Help businesses to evolve Across the organisation Across departments To other organisations and customers Impact of information technology & information systems development

Information technology & information systems Help businesses to evolve B 2 B Model  occurs when organisations buy / sell between themselves over the internet  eliminates need for intermediaries  reduces costs B 2 C Model  occurs when organisations directly sell their goods / services to customers over the internet  reduces need for physical location / stores  extends customer reach  reduces costs Selling entity Buying entity Selling entity Customers Impact of information technology & information systems development

RECAP  Effects of social & demographic trends  Impact of social changes on organisation  Government measures in response to demographic changes  Effects of technological changes  Impact of information technology and information systems development