Why change in business is essential?
The business world is changing at a rapid speed which is not only impacting the small business houses but is also bringing a massive change in the norms of the big corporates. Due to lack of funds, or decreased profits, many partnerships have failed, Joint Ventures have come to an end, and much more. Corona Pandemic has changed the way of carrying out business activities. It has not only changed the operational activities of the business but also the internal working and mindsets of the people regarding their work profiles.
Change is something that is inevitable or it could be said that change is the only permanent thing. Business change is something that is bound to happen even when there is a slight change in the economy. It is not only the economy that brings the changes in the company but also certain internal factors that lead to changes in the business. It is sometimes these changes that decide the success or failure of the business in the future.
Concept of Change in Business
There occur many times that certain changes are to be made in the business norms or conditions due to external or internal factors. Such as Appointment of Director, Change in Name of the company, Change in the location of the company, Change in form of business entity, Change in Profit/loss ratio, Change in LLP agreement, etc. these are certain factors that bring a change in the business. These changes are to be made as per the need of the hour.
It has been proven in research that about 62% of the people resist making these changes until and unless they are being compelled to do so or it becomes completely important for the business.
Examples when changes are to be made in business
Some most of the common examples that lead to a change in business are as follows-
Change in LLP Agreement–
LLP Agreement is one of the most important agreements that is being made while registering a business as a partnership entity. This document states the partner’s rights, duties, and obligations towards the business and the partnership they are entering into.
Reasons for change in LLP Agreement:
- Change in profit/loss sharing ratio
- Change in Business activities
- Change in right and liabilities of partners in Partnership
- Change in Management structure
Change in a Partnership firm–
Change in a partnership firm business happens when there is a change in partners in a partnership. These changes reconstruct the partnership firm. The changes can happen only when the existing partners give their confirmation for the same.
Reasons for change in Partnership firm:
- Addition of a new partner
- Insolvency of the existing partner
- Death of the partner
- Retirement of the partner
- Expulsion of a partner
Change in the company’s name–
Changing the company name brings a huge change altogether not only in the Memorandum of Association and Article of Association but also in the established image and branding of the company. Though the business owners or activities remain the same with the change in the name there is a possibility that the public might not be able to recognize the company easily.
Reasons for change in Company’s name:
- The company name no longer depict the activities of the business
- The name of the company has come up with some unwanted controversies.
- The name of the company is not catchy or even after constant marketing people are not able to approach you
- The name is very common and matches with the other well-established brands
Challenges faced while incorporating changes in business
Incorporating changes like change in LLP Agreement, Change in LLP Format, Change in a company name, Change in partners, etc. is a hectic and lengthy process. It requires many legal formalities to be done. Although, many firms provide these services of making changes in the business as per the needs still many challenges are faced by the owners of the business while making changes. Some of the challenges being faced are as follows-
- Bringing changes such that the goal does not change: While incorporating the changes in the business, the biggest challenge which is faced is that the particular change does not bring any change in the goals or purpose of the business.
- Agreement of all for bringing the change: It might be possible that when changes are to be made then everyone does not agree for the same. This happens especially in the Partnership form of business, that out of the existing partners, some may deny for the changes to be incorporated.
- Fear acts as the biggest challenge: Fear and uncertainty act as the biggest challenge while incorporating the change. Sometimes, it might happen that the intended change might not prove to be fruitful for the business. Therefore, before incorporating the changes fear and uncertainty exists among the people.
There are various other challenges that often push back people from making the changes to the business but there are some companies who are experts in giving this service to their clients. One such company is Vakilgiri ( https://www.vakilgiri.com/services/ ). Vakilgiri makes sure that changes in your business are made as per your requirements. It is not only this service that they provide to their client but also various other services are being provided by Vakilgiri. So, if you are thinking to bring some changes in business make sure that you consider Vakilgiri for the same.
