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A LevelBusinessAQARevision Notes7. Analysing the Strategic Position of a Business (A Level)7.3 Changes in the External EnvironmentSocial and Technological Change

Social and Technological Change (AQA A Level Business): Revision Note

Exam code: 7132

Lisa Eades

Written by: Lisa Eades

Reviewed by: Steve Vorster

Updated on

Social change

  • Social change refers to changes in demographics and population movements, as well as changes in consumer lifestyles and behaviour

  • The UK has undergone significant social change in recent years

  • These changes have had a significant impact on strategic and functional business decision-making

Diagram titled "Key Social Trends" with connected ovals listing: an ageing population, growth of online businesses, ethical consumers, migration, home working.
In recent years, there has been a growth of migration to the UK, more homeworking and increased consumer interest in sustainability

Impacts of social change on business

Change

Explanation

Impact on business

The growth of online businesses

  • Internet shopping has grown from about 8.3% of retail sales in 2011 to 27.2% in 2024

  • Retailers have invested in their online shops and digital advertising

  • Companies have redesigned logistics to handle more online orders

Ageing population

  • The median age in the UK rose from 39.6 years in mid-2011 to 40.7 years by mid-2022

  • Firms have developed new products for older customers, such as easy-to-use smartphones or specialist travel services

  • Businesses have changed HR policies to keep experienced older staff on longer, offering flexible hours or phased retirement

Migration

  • The share of people from non-white ethnic groups in England and Wales increased from 14% in 2011 to more than 18% by 2021

  • Brands have expanded product ranges to reflect different cultural tastes

  • Companies have established diversity targets and training to attract staff from different backgrounds

Growth of home working

  • The proportion of workers doing some or all of their work from home doubled from 14.5% in late 2019 to more than 30% in early 2022

  • Many firms have reduced their office space or switched to hot-desking to support hybrid work

  • Businesses have invested in video-calling tools and stronger online security

Ethical consumers

  • UK consumers say they are willing to pay an average of around 10% more for sustainably produced goods

  • Companies have switched to eco-friendly packaging and advertise their commitment to sustainability

  • Firms introduced 'green' product lines at slightly higher prices and adapted existing products to meet environmental targets

Case Study

Impact of recent social change on Style Spectrum Ltd

Clothing rack with a t-shirt, dress, and jacket under the colourful text "Style Spectrum" in a gradient from purple to orange.
Style Spectrum Ltd

Style Spectrum Ltd is a UK-based retailer selling casual and work clothing through 50 high-street stores and its own e-commerce website. The firm employs around 500 people in retail, logistics and head-office roles

Background

Before 2020, 80% of StyleSpectrum’s sales came from in-store purchases, with only 20% online. The company faced five major social shifts that threatened its growth unless it adapted

Company responses to social changes

1. Growth of Online Shopping

  • Launched a user-friendly e-commerce site and mobile app

  • Spent £5 million on digital ads and social-media campaigns

  • Upgraded its main warehouse and introduced same-day delivery in major cities

2. Ageing Population

  • Introduced the 'Comfort Classics' range, with easy-fasten clothes and clear labels for customers over 60

  • Redesigned the website with larger text, simpler menus and a dedicated 'Senior Savers' section

  • Offered flexible hours and phased retirement to keep experienced store managers longer

3. Growing Migration and Diversity

  • Added new ethnic-inspired collections (e.g. African prints, South Asian formal wear) in 20 pilot stores

  • Set a target that 30% of all new hires in stores come from minority backgrounds

  • Ran cultural-awareness workshops for managers on inclusive service

4. Rise of Home Working

  • Launched a premium loungewear and home-accessories line

  • Converted head office to hot-desking and cut its office footprint by 40%

  • Invested in video-calling tools (e.g. Zoom, Teams) and stronger online security

5. Demand for Ethical Products

  • Rolled out the 'EcoStyle' clothing line made from organic cotton and recycled fibres

  • Priced EcoStyle garments 10% above standard lines, highlighting its fair-trade certification

  • Promoted sustainability through in-store displays and social-media storytelling

Impact on StyleSpectrum Ltd.

  • Online Sales Boom

    • E-commerce grew from 20% to 55% of total revenue in one year, lifting overall turnover by 30%

  • New Customer Segments

    • Comfort Classics accounted for 15% of clothing sales and boosted footfall in suburban shops

  • Faster Deliveries

    • Upgraded logistics cut average delivery time from four days to next-day in major areas, cutting complaints by 40%

  • Stronger Brand Image

    • EcoStyle sold out its first collection in three months, and customer surveys showed a 25-point rise in brand favourability

  • Improved Staff Retention

    • Flexible work policies reduced voluntary staff turnover from 18% to 10%, saving on recruitment and training costs

Conclusion
By quickly adapting to online growth, an ageing population, increased diversity, more home working and rising demand for ethical products, Style Spectrum Ltd not only protected its sales but also unlocked new markets, improved efficiency and strengthened its brand for the future

The impact of technological change on functional areas and strategy

  • The last decade has also seen much change in the range and capability of technology used to support business operations

  • This change has had a significant impact on strategic and functional business decision-making

Impacts of technological change on business

Change

Explanation

Impact on business

5G mobile networks

  • Around 92% of UK premises could receive an outdoor 5G signal as of January 2024

  • Businesses can now deploy Internet-of-Things sensors and remote-monitoring equipment with very low delays

  • Companies in media and entertainment can offer high-quality live streaming and virtual reality experiences

Full-fibre broadband

  • 62% of UK homes had access to full-fibre (fibre-to-the-premises) broadband by July 2024

  • Firms can base offices in more remote or suburban areas, confident staff have reliable high-speed internet

  • With stable links, companies moved more applications to the cloud, reducing the need for vulnerable on-site servers

Cloud computing

  • 85% of UK businesses were using cloud computing services in 2023

  • Businesses have adopted cloud collaboration tools (e.g. platforms like Google Drive) to support hybrid teams, allowing employees in different locations to work together seamlessly

Industrial robotics

  • Industrial robot installations in the UK rose by 51%, reaching 3,830 units in 2023

  • Manufacturers can redeploy robots easily between production lines, adapting to changes in demand

  • Operations teams have shifted routine or dangerous tasks to robots, using staff in maintenance and quality control roles

Artificial intelligence

  • 39% of UK businesses reported adopting AI in 2023, up from 30% in 2022

  • Businesses use AI chatbots on websites to handle common enquiries, freeing up call centre staff to focus on complex issues

  • Marketing teams use AI-powered analytical tools to predict sales trends and personalise promotions

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    Author
    Reviewer
    Lisa Eades

    Author: Lisa Eades

    Expertise: Business Content Creator

    Lisa has taught A Level, GCSE, BTEC and IBDP Business for over 20 years and is a senior Examiner for Edexcel. Lisa has been a successful Head of Department in Kent and has offered private Business tuition to students across the UK. Lisa loves to create imaginative and accessible resources which engage learners and build their passion for the subject.

    Steve Vorster

    Reviewer: Steve Vorster

    Expertise: Economics & Business Subject Lead

    Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all.