ACCA Applied Knowledge · Business and Technology
Technological Factors in ACCA Business and Technology
Technological factors are the ways technology changes the environment a business operates in. In ACCA BT you must show how technology affects products, services, processes and operations, and how a business can respond and manage the risks. Answer by linking the technology to a specific business effect: cost, speed, quality, competition or risk.
What this chapter covers
This chapter looks at technology as one of the external factors that shape a business. It sits within the BT study of the business environment, next to political, economic, social, environmental and legal factors. The chapter asks one question in four ways: what is changing, what does it do to what the business sells, what does it do to how the business works, and how should the business respond.
You move from the outside in. First you see technology as a force in the environment. Then you see its effect on products and services. Then its effect on internal processes and operations. Finally you look at how organisations respond to change and what risks come with it.
The chapter connects to the rest of the paper in several places. It links to PESTEL analysis and competitive forces in the environment sections. It links to organisational structure and strategy, because technology can change both. It also links to the accounting systems, data, cyber security and controls content, where the same risks reappear in more detail. Learning it well helps you in several other chapters.
Technology questions appear in the objective test sections, where you must pick the best answer quickly, and they can also feed into the multi-task questions that test the business environment. The content is mostly applied understanding rather than calculation, so it rewards steady, clear thinking. If you can match each technological change to its likely business effect and risk, you can answer many scenario-style questions without long working. The same reasoning also supports your answers in other BT chapters, so the effort pays back more than once.
Technological factors: topics in the order to study them
- 1Technology and the Business EnvironmentStart here because it sets the big picture: technology as an external factor and how it creates opportunities and threats.
- 2Impact of Technology on Products and ServicesNext, look at what the business sells, since customers and competitors feel technological change first through products and services.
- 3Technology and Business Processes and OperationsThen move inside the business to see how technology changes the way work is done, and what it does to cost, speed and quality.
- 4Responding to Technological Change and Its RisksFinish with the response and the risks, because you need the earlier effects clear before you judge how to manage them.
How to prepare Technological factors
This chapter is concept-based, so your aim is to build clear links between a technology, its effect and its risk. Use short, active sessions that suit study on a phone.
- Read the first topic and write a one-line definition of each key term in your own words.
- For each technology you meet, write three short notes: the effect on products, the effect on processes, and one risk.
- Link each point to PESTEL and the wider business environment, so you see technology as one factor among several.
- Practise objective test questions after each topic. For multiple response questions, check how many answers you must select before you read the options.
- When you get a question wrong, write why the right answer fits the scenario better, not only what the answer was.
- Re-read the response and risk topic last, and test yourself on which response suits which situation.
- Revisit your notes after a few days and again before the exam, using the quick revision points as a checklist.
Common mistakes in Technological factors
Listing technologies without explaining their effect on the business.
Fix: For every technology, finish the sentence with a business effect, such as lower cost or faster service.
Treating technology only as a benefit.
Fix: Always pair each benefit with at least one cost or risk, such as investment, disruption or security.
Mixing up the effect on products with the effect on processes.
Fix: Ask whether the change affects what the customer buys or how the business makes and delivers it.
Selecting the wrong number of answers in multiple response questions.
Fix: Read the stated number of answers first, then eliminate options that do not fit the scenario.
Choosing an answer that is true in general but does not fit the scenario.
Fix: Underline the key facts in the question and pick the option that matches them most directly.
Ignoring people and change management when responding to technological change.
Fix: Include training, communication and staff involvement whenever a question asks how to introduce new technology.
Last-day revision: Technological factors
- Technology is an external factor in PESTEL: it creates both opportunities and threats.
- Technological change can lower entry barriers and increase competition in an industry.
- New technology can create new products and services or make existing ones obsolete.
- Technology can improve a product's quality, features and delivery to customers.
- Technology can change how a business reaches customers, for example through online channels.
- In processes, technology often brings speed, accuracy and lower unit costs, but needs investment.
- Automation can reduce routine manual work and change the skills a business needs.
- Staff training and change management help people accept new technology.
- Risks include cyber attacks, system failure, data loss and the cost of getting technology wrong.
- A business can lead, follow or wait on new technology, and each choice has a different risk.
- In every answer, link the technology to a clear business effect.
- Read the question type first: multiple choice, multiple response or number entry.
Technological factors practice questions
- Ferndale Ltd has replaced its manual order processing with an automated system. Staff morale has fallen because many employees fear redundan…
- A furniture company uses computer-aided design linked directly to computer-controlled machines so that design changes flow straight into pro…
- A manufacturer of household appliances adds sensors and internet connectivity to its washing machines so that they report faults to the comp…
- A manufacturer plans to introduce robotic production lines. Employees fear job losses and some have said they will not cooperate. Which appr…
- A manufacturer uses 3D printing to produce prototype parts in-house rather than ordering them from an external toolmaker. Which operational …
- A manufacturer installs sensors on its production machines that send live performance data to a central system. The system automatically fla…
- A regional bank launches a mobile app that lets customers open accounts and make payments without visiting a branch. Which effect of technol…
- Which of the following is a risk that arises specifically because a company stores its customer data with a third-party cloud service provid…
Technological factors in other exams
The same ground in other exams, if you are preparing for more than one or want another angle on it.
Technological factors: frequently asked questions
What are technological factors in ACCA BT?
They are the technology-related forces in the external environment that affect a business. You study how they change products, services, processes and operations, and how a business should respond to them and to their risks.
Is the technological factors chapter calculation-heavy?
No. It is mainly about understanding and applying ideas, so you will mostly judge which answer best fits a scenario. Accuracy comes from reading the question carefully and linking the technology to a business effect.
How should I study this chapter on my phone?
Use short sessions on one topic at a time. Keep a running note of each technology with its effect and risk, and practise a few objective test questions after each session.
How does this chapter connect to the rest of BT?
It builds on the business environment and PESTEL analysis, and it links to strategy, organisation and the later content on systems, data and security. The same ideas of effect and risk appear in those chapters too.