In common usage a step change happens when a situation changes in a discontinuous way: a big policy change after an election, a currency devaluation, the discovery of gold at Sutters mill for example. That is to say, a change like a step in an otherwise smooth graph.

This concept has been borrowed from mathematics and technology where the phrase step function is rigorously defined.

Catastrophe theory is one mathematical theory used to explain step changes.

In business often referred to as a significant change in direction or shift in paradigm. Step Change in business language has a positive connotation meaning that the change associated with a Step Change does not only require significant efforts to achieve it but more importantly leads to increased value or returns.
http://en.wikipedia.org/wiki/Step_change