business studies igcse sow

IGCSE CIE Business StudiesSuggested Scheme of Work

The scheme of work includes the following: Teaching sequence Time allocation Learning objectives Assessment objectives Teaching strategies Teaching material

Teaching sequence/Time allocation

It is anticipated that most centres following this IGCSE CIE Business Studies course will be teaching the subject over a two-year period. The syllabus is designed to be delivered in 139 hours of guided teaching time. This does NOT include time allocated for homework / individual study / coursework or extension assignments/revision or internal examinations.

The teaching sequence is given as a guide and is not meant to be prescriptive. It does, however, broadly follow the pattern of the book and should be of help to teachers in delivering the course. It should be read in conjunction with the syllabus documents – to which the numbering refers. You should remember that much of the content of a Business Studies syllabus is integrated. For example, it is difficult to teach marketing without some mention of costs associated with advertising and promotions. Topics are not neatly self-contained It is thus a matter of professional judgement as to how much content to teach and when. Should costs and costing be taught before marketing? We suggest that you teach as much as is needed to gain a broad understanding of the issues and then focus on greater detail at a later and more appropriate time. This will allow for revision and reinforcement of material to help increase students’ understanding. Experience has taught us that certain topics such as financial areas are more difficult for some students to intuitively understand, so we suggest that teachers give their classes plenty of numerate exercises to help reinforce principles and build up student confidence.

Suggested time allocation

[the following refers to the syllabus code 0450]

A Business activity [1.1.1–1.1.4] 11 hours 8% of teaching time

B The organisation [1.2.1–1.2.3]; Business structure, Organisation and control [2.1.1–2.1.8] 18 hours 13% of teaching time

C Marketing [3.1.1–3.1.12] 24 hours 17% of teaching time

D Operations management [3.2.1–3.2.9] 19 hours 14% of teaching time

E People in business [4.1.1–4.2.3] 18 hours 14% of teaching time

F Finance [2.2.1–2.2.4]; Financial information [3.3.1–3.3.8] 22 hours15% of teaching time

G Changing business environment [1.31–1.3.3]; Economic environment [1.4.1–1.4.5]; Regulating business activity [5.1.1–5.2.6] 26 hours

19% of teaching time

The following is a suggestion for a teaching sequence

Also included are specific page references to the textbook that are shown in brackets (pp); the Suggested time allocation is shown in square brackets [hours].

1. Business activity and the environment in which it operates

1.1 Business activity

1.1.1 Business activity as a means of adding value/meeting customer needs/meeting business objectives (pp2–5) [4]

1.1.2 Classification of business (pp6–7) [2]

1.1.3 Business growth and measurement of size (pp8–9) [2]

1.1.4 Key features of own national economy/impact of business activityon the environment (pp10–13) [3]

1.2 The organisation

1.2.1 Business objectives and their importance (pp16–17) [2]

1.2.2 Stakeholders and their objectives (pp18–19) [2]

1.2.3 Aims of private and public sector enterprises (pp20–21) [2]

2. Business structure, organisation and control

2.1 Ownership and internal organisation

2.1.1 Relationship between objectives, growth and business organisation (pp52–53) [1]

2.1.2 Types of business organisation (pp48–51) [2]

2.1.3 Growth of multinational companies (pp54–55) [1]

2.1.4 Control and responsibility (pp58–59) [2]

2.1.5 Limited and unlimited liability (pp56–57) [1]

2.1.6 Internal organisational structure (pp60–61) [2]

2.1.7 Internal and external communications (pp64–67) [3]

2.1.8 Effective communication (pp62–63) [1]

3. Business activity to achieve objectives

3.1 Marketing

3.1.1 Role of marketing (pp80–81) [1]

3.1.2 Market research (pp82–83) [2]

3.1.3 Presentation of results (pp84–85) [2]

3.1.4 Market segmentation (pp86–87) [2]

3.1.5 Mass and niche markets (pp88–89) [1]

3.1.6 Marketing mix (pp90–91) [2]

3.1.7 Product (pp92–93) [2]

3.1.8 Price (pp94–95) [2]

3.1.9 Distribution channels (pp96–97) [2]

3.1.10 Promotion (pp98–99) [2]

3.1.11 Marketing strategy (pp100–101) [4]

3.1.12 Marketing budget (pp102–103) [2]

3.2 Production (operations management)

3.2.1 Using resources to produce goods and services (pp106–107) [2]

3.2.2 Methods of production (pp108–109) [3]

3.2.3 Scale of production (pp110–111) [2]

3.2.4 Lean production (pp112–113) [1]

3.2.5 Costs and cost classification (pp116–117) [2]

3.2.6 Break-even analysis (pp118–119) [3]

3.2.7 Quality control (pp114–115) [1]

3.2.8 Location decisions (pp120–121) [3]

3.2.9 Business efficiency (pp122–123) [2]

4. People in business (human resources)

4.1 Human needs and rewards

4.1.1 Role of work in satisfying human needs (pp148–149) [3]

4.1.2 Methods of financial rewards (pp150–151) [2]

4.1.3 Non-financial rewards (pp152–153) [3]

4.1.4 Management styles and motivation (pp154–157) [3]

4.2.1 Stages of recruitment/selection (pp160–163) [4]

4.2.2 Training methods (pp164–165) [2]

4.2.3 Dismissal and redundancy (pp166–167) [1]

2.2 Financing business activity

2.2.1 Use of funds (pp70–71) [1]

2.2.2 Short- and long-term financial needs (pp70–71) [1]

2.2.3 Sources of funds (pp72–75) [2]

2.2.4 Choice of funds (pp76–77) [2]

3.3 Financial information and decision-making

3.3.1 Cash and cash flow forecasts (pp126–127) [3]

3.3.2 Profit (pp128–129 & 132–133) [1]

3.3.3 Profit/loss account (pp130–131) [2]

3.3.4 Balance sheet (pp134–135) [2]

3.3.5 Interpretation of financial statements (pp136–139) [4]

3.3.6 Working capital (pp140–141) [1]

3.3.7 Financial budgets (pp142–143) [1]

3.3.8 Users of financial accounts (pp144–145) [2]

1.3 Changing business environment

1.3.1 Government influence over decision-making using economic measures (pp24–27) [2]

1.3.2 Impact of technology on business (pp28–31) [2]

1.3.3 Business reaction to market changes (pp32–33) [1]

1.4 Economic environment

1.4.1 Mixed and market economies (pp36–37) [1]

1.4.2 International trade (pp38–39) [2]

1.4.3 Problems of entering markets abroad (pp40–41) [2]

1.4.4 Competition and business (pp44–45) [2]

1.4.5 Exchange rates and their impact on business (pp42–43) [1]

5. Regulating and controlling business activity

5.1 Regulating and controlling business activity

5.1.1 Impact of business decisions on people/economy/environment (pp172–177) [3]

5.2 Influences on business activity

5.2.1 Location decisions (pp178–179) [1]

5.2.2 Workforce/working environment/health andsafety/employment laws (pp180–187) [3]

5.2.3 The consumer (pp188–189) [1]

5.2.4 External costs and benefits (pp190–191) [3]

5.2.5 Exchange rates (pp190–193) [1]

5.2.6 Business cycle (pp194–195) [1]

Learning & assessment objectives

The CIE syllabus document shows that candidates are assessed against four main skills, namely:

AO1 Knowledge with understanding

AO2 Application

AO3 Analysis

AO4 Evaluation

The weighting given to these objectives varies between the two written papers but on average the marks will be awarded in the following proportions:

AO1 Knowledge 30%

AO2 Application 30%

AO3 Analysis 20%

AO4 Evaluation 20%

Therefore, it is obvious that teaching students facts and information alone is insufficient. Only 30 per cent of the total marks are available for demonstrating this skill. Teachers must ensure that their lessons allow students to develop other ‘thinking’ skills; students need to be challenged, asked to make simple decisions, to justify their recommendations and to communicate their ideas in a structured and logical manner. They need to have stimulating information put in front of them and to be asked to describe/comment/analyse/assess this information. This way a higher level of understanding is developed and learning becomes more active and enjoyable.

The material in each chapter is designed to capture students’ interest and to stimulate thought and inquiry. The case studies are ‘real’ and encourage instant application of concepts that have been taught. Through this active learning, real progress is made and results are achieved. The whole process is fun and encourages success through involvement and participation. Knowledge of business concepts is the starting point of the learning process. The aim is to allow this to be the launching pad for thought and inquiry, to ask questions of the teacher and to reflect on what has been taught.

Hints on using the book successfully

The following are suggestions regarding lesson activities, student research topics, exercises and questions to be asked for use in the classroom. The ideas emerge from the content of the units of the book and merely represent an extension of the material. They are just illustrations of what can be done and teachers will no doubt wish to build on them by using their own resources. Remember that it is always a good idea to keep in mind the learning objectives of the units. This should act as a guide as to the appropriateness of an activity.

The book contains a series of questions which will help teachers assess the progress of their students. The questions are grouped in the following way:

1. Summary questions contained in each unit. These questions focus on the main points contained in the unit. These questions are usually short.

2. End of unit practice exam questions. These questions fall into two groups:(a) Section 1 – short-answer questions(b) Section 2 – longer-answer questions These questions cover the material from a number of units and are ideal for periodic assessment.

3. Longer case studies. There are three of these (pp198–203). These questions are similar in style to the CIE Paper 2 questions. These are ideal for end-of-course revision

Questions can be used to reinforce principles taught, as well as to assess the understanding of students. They should be seen as an aid to the learning process. Students learn a great deal from the positive feedback given to their answers by teachers.

1.1 Business activity and the environment in which it operates

Unit 1.1 Understanding business activity [3 hours]

Key learning objectives:

Understand the nature of business activity.

Develop awareness of why businesses exist.

Understand the concept of added value.

Appreciate the difference between a want and a need.

Understand the concept of scarcity.

Class activities

1. Ask students what would happen if there were no businesses in their country.

2. Would they be better or worse off without businesses in their country?

3. What businesses can they name?

4. Why will people pay more for a branded sports shoe than for an unbranded one?

5. What does that tell us about customers?

6. Can students identify commodities that are scarce in their country?

7. Why are they scarce?

8. What problems does scarcity cause? e.g. products such as water/oil/rice.

9. Get the class to calculate added value from some data provided. (Question 4, page 14.)

Unit 1.1.1 Business objectives [1 hour]

Key learning objectives:

Understand the nature of an objective/goal.

Appreciate the objectives of different organisations.

Class activities

Students should consider the following issues:

1. What is the purpose of an objective?

2. What objectives might people set themselves?

3. What objectives might a hospital have?

4. What objectives might a local shopkeeper have?

5. What is: (a) similar (b) different about these objectives?

Unit 1.1.2 Classification of business [2 hours]

Key learning objectives

Understand the basis of business classification.

Apply this classification to your country.

Class activities

1. Give an example of an activity in the primary sector of your country.

2. Get students to provide other examples.

3. Apply the same process to secondary and tertiary sectors.

4. Consider why the balance of activities might change over time.

5. Use the summary questions on page 7 to reinforce these ideas.

Unit 1.1.3 Business growth and measurement of size [2 hours]


Understand the concept of business size.

Know how business size can be measured.

Appreciate the problems of measuring size.

Understand the reasons why the size of a business changes over time.

Class activities

1. Use summary questions on page 9 for reinforcement of content.

2. Encourage a group activity to look at a particular business in your country and find out how large it is in terms of sales turnover/capital employed/number of employees/market share. Each group looks at a different business and reports back to class and the teacher presents the results in the form of a summary table. Discuss findings in class.

1.1.4 Key features of own economy/impact of business activity on the environment [3 hours]


Understand that business activity has an impact on the environment.

Appreciate the concept of ‘sustainable development’.

Understand the structural changes that have occurred in their own country.

Apply such changes to the environment of their country.

Class activities

1. Research into the activities of a large business and investigate what impact it has on use of national resources/pollution/sustainable development. Discuss the findings. Alternatively, present the class with some prepared examples and get them to carry out some simple analysis of the information. Perhaps use the case study ‘Changes in the Philippines’ on page 12.

2. Give the class data of employment patterns over time in terms of primary, secondary and tertiary sectors. Ask the class to:(a) present the data in the form of a graph(b) identify the main trends of the data (c) give possible reasons to explain what has been identified.

1.2 The organisation

1.2.1 Business objectives and their importance [2 hours]


Appreciate the need for objectives.

Understand why a business might have different objectives.

Class activities

1. Give the class data of growth and market share of three large companies. Ask them to compare performance of companies against these two criteria.

2. Use the case study ‘Google’s objectives’ on page16 to reinforce the concept of business objectives.

1.2.2 Stakeholders and their different objectives [2 hours]


Understand the nature of different stakeholders.

Appreciate that different stakeholders seek different objectives.

Class activities

1. Investigate a major business activity such as extraction of oil / minerals preferably in your own country. Get the class to:(a) identify the stakeholders involved in this activity(b) list the objectives of the different stakeholder groups (c) explain the differences in objectives they have identified (d) compare and contrast the different objectives.

1.2.3 Aims of the private and public sectors enterprises [2 hours]


Identify the objectives of private sector enterprises.

Identify the objectives of public sector enterprises.

Understand the main differences between the two sectors.

Appreciate that a profit seeking enterprise will behave differently from a service providing enterprise.

Class activities

1. Study a major public sector enterprise in your country, such as provision of health care. You will have to prepare this information. Get the class to:(a) identify the main objectives of this provision (b) consider if they have been achieved (c) discuss what would happen if the provision was in the private sector.

2. Use the case study ‘Indian Railways’ on page 21 to reinforce the concept of private sector and public sector objectives

2. Business structure, organisation and control

2.1.1 Objectives growth and business organisation [1 hour]


Understand the different forms of business organisation.

Appreciate the objectives of the different types of business.

Understand how and why a business may change over time.

Class activities

1. Look at a local small business, such as a retail shop. Identify: (a) who is in control (b) what objectives does it probably have (c) how might it have to change if the business wants to grow.

2. Use the case study ‘Hero Cycles’ on page 52 to illustrate growth and objectives of a business over time.

2.1.2 Types of business organisation – sole traders and partnerships /other types of business organisation [2 hours]


Understand the main features of sole traders and partnership.

Appreciate the significance of the features.

Understand the main features limited companies/franchises/joint ventures.

Class activities

1. Divide your class into groups. Each group draws a table showing the main features of the different types of business organisation that the class has studied. State whether you think that the features you have identified are an advantage or a disadvantage to the owner(s) and justify your answers. The groups report back to the class. Draw the main conclusions from the exercise, making sure that at the end all students have a ‘correct’ version of the chart.

2.1.3 Multi national companies [1 hour]


Understand the nature of a multinational company.

Have some appreciation as to why they have increased over time.

Have an understanding of their implications for the countries where they are situated.

Class activities

1. Get the students to identify three multinational companies that operate in their own country. Then investigate: (a) what products/services they provide (b) what markets they operate in (c) whether their country would be better or worse off if the multinational company did not exist.

2. How do they quantify their answers?

2.1.4 Roles and responsibilities [2 hours]


Understand why a business needs an organisational structure.

Appreciate the implications of different forms of structures.

Class activities

1. Draw an organisational chart for your school/college. Describe its features in terms of hierarchy/span of control/chain of command/delegation. You may need to provide a chart, either completed or partially complete, as an aid.

2. Give the class an organisational chart for a local business. The students analyse the chart in terms of span of control/chain of command/hierarchy.

2.1.5 Limited and unlimited liability [1 hour]


Understand the concepts of ownership and risk.

Understand and appreciate the concept of limited liability.

Class activities

1. Get the class to consider the following scenario: they invested money in the shares of a company, which then collapsed. What would happen to the shareholders if the business had:(a) unlimited liability (b) limited liability.

2. Consider whether they would invest in a business with unlimited liability. Assess the benefits of limited liability to:(a) shareholders (b) the business.

2.1.6 Internal organisation [2 hours]


Understand the difference between ownership and control.

Understand the role of management in a business.

Class activities

1. Consider the difference in the role of a head teacher and a classroom teacher.

2. Find out what happens at the AGM of a company.

2.1.7 Internal and external communication [3 hours]


Understand the methods of communication that can be used internally and externally by a business.

Appreciate when methods are appropriate.

Class activities

1. Get the class to consider the following question. How effective is a school report as a method of communication?

2. Get the class to consider the role of the internet as a method of communication by looking at emails, social networking websites, search engines, business websites, etc.

2.1.8 Communication [1 hour]


Understand the concept of communications.

Understand how communications takes place.

Understand the ‘barriers’ to communication.

Class activities

1. Ask the class to consider the following: they are absent from school for a few weeks and want to catch up on the work they have missed. The following options exist: (a) get their friends to tell them what has been done (b) borrow their friends class notes (c) ask the teacher to give them the notes they have missed (d) ask the teacher for the textbook references for the work. Identify the advantages and disadvantages of each option and state which is best justifying your answer. What does this tell us about the effectiveness of different methods of communication

2. Get the class to list the main barriers to communication they know about. (Why do they find it difficult to follow?) How do they think things could be improved?

3. If any of the class is on a committee get them to tell the class how effective they think meetings are.

3. Marketing

3.1.1 The role of marketing in a business [1 hour]


Understand what is meant by marketing.

Appreciate why marketing is needed in business.

Understand that marketing is much more than selling.

Class activities

1. Use the case study ‘Bonux, Romania and Nigeria’ on page 80 to illustrate the use of marketing in making decisions.

2. Consider the following statement: ‘If a company makes a good product it will always sell.’ Get the students to argue the case for and against this statement, using examples to support their reasons.

3.1.2 Market research (primary and secondary] [2 hours]


Know what is meant by market orientation.

Understand the need for market research.

Be aware of the different ways of gathering market research data.

Understand the different advantages of primary and secondary market research data.

Understand that market research is not ‘perfect’ information.

Class activities

1. You are investigating student’s views of the lunches provided at your school (or local café). (a) Prepare six questions with the students you think should be asked.(b) Explain the value of the information gathered by each question. (c) It would be impossible to ask all of the pupils what they thought so they will have to take a sample. How will they choose who to ask? (d) Do your students think the results will be reliable (accurate)? Explain your answer. (Perhaps the activity could be carried out within the class or school as a whole.)

2. Get the class to carry out a search into secondary information that is available on the internet about a company or an activity. Pool the findings and draw conclusions from it. These might include: how up to date is the information?; how useful is it to someone studying the business?; how comprehensive is it?; how easy was it to gather?; what else might you want to know that the secondary sources failed to tell you?

3.1.3 Presentation and use of results [2 hours]


To present, analyse and interpret market research data.

To calculate values from data.

Understand the main methods of presentation such as graphs, charts, tables and diagrams.

Class activities

1. Give the class data about a company over a certain period. Information might include: sales value; ratio of domestic sales to exports; number of employees; value of profits; number of branches. Ask the class to represent this data using different methods, such as graphs, pie charts, bar charts, pictograms, etc. They should choose the method they think best illustrates the data. They might use a line graph to show sales value over time and a pie chart to show market distribution of sales, and so on. Stress the need for sensible scales, clarity of presentation, headings, labels, keys, etc. Conclude the exercise by asking them to comment on whether the method makes it easier to understand the data.

3.1.4 Market segmentation [2 hours]


Understand why it is necessary to segment a market.

Understand how markets can be segmented.

Appreciate how market segmentation can help a business develop its marketing plans.

Class activities

1. Divide the class into groups and get each to look at four different products or services. They then decide if the whole of a market would be interested in the product or just a segment. Products could be a computer action game, a fashionable pair of jeans, a lawnmower, an mp3 player, etc. (Add more if needed.) Consider in groups how segmenting a market might help in the marketing of the products. The groups then report back to the class. Draw conclusions from exercise.

3.1.5 Mass and Niche markets [1 hour]


Understand the difference between niche and mass markets.

Appreciate the significance of the distinction in devising marketing plans

Class activities

1. Use the case study ‘Niche marketing of tourism in Jordan’ on page 89 to reinforce the distinction between niche and mass marketing.

2. Carry out the activity exercise given on page 88 to further aid understanding of this distinction.

3.1.6 The marketing mix [2 hours]


Know what is meant by the marketing mix.

Understand why a marketing mix matters.

Class activities

1. Use the case study ‘The Tata Nano’ on page 91 to develop understanding of the concept of a marketing mix.

2. Consider the consequences of the following:‘The product and the promotion are right but the price and the place are not.’What does this tell us about the importance of the mix?

3.1.7 The product [2 hours]


Understand the importance of the product in marketing.

Acquire knowledge of a product life cycle.

Understand how and why a product life cycle can be extended.

Show awareness of the concept of a brand.

Understand the role of packaging in marketing a product.

Class activities

1. Draw three product life cycles with different patterns on the board. Hold a class discussion on the causes and consequences of these patterns.

2. Give examples of products that are at different stages of their life cycle. In groups get the students to place the products against the ‘right’ stage. Hold a class discussion on the extension strategies that could be employed for a product that is at the maturity stage of its life cycle.

3. Ask students to look at the packaging on two products in their home and to write about the function that the package performs. Select some students to report back to the class.

4. Get the class to identify three familiar branded products. Students tell the class what they know about the product – for example: quality; function; price; reputation; adverts; promotions. Hold a class discussion on the function of branding and its potential impact on sales.

3.1.8 Price [2 hours]


Understand how a business might decide on a price for a product.

Appreciate the importance of price in the buying decisions of customers.

Show awareness of the concept of price elasticity of demand.

Class activities

1. Carry out the activity on page 94 with the whole class.

2. Divide the class into groups. Within the group, each student should give an example of a product they have recently bought. Get them to consider the following: (a) How important was the price in deciding whether to buy?(b) Did they look for the lowest price they could obtain the product for?

3. Get the groups to report back with their conclusions regarding the importance of prices in influencing what people buy. Apply their findings to the concept of the marketing mix and price elasticity of demand.

3.1.9 Distribution channels [2 hours]


Understand what is meant by distribution.

Awareness of different distribution channels.

Appreciate when a particular channel would be appropriate for a given product.

Class activities

1. Use the case study ‘Coco-Cola in China’ on page 97 to illustrate the importance of distribution and the supply chain.

2. Hold a class discussion. Identify products that can or can not be sold easily on the internet. Explain the reasons for the choices.

3.1.10 Promotion [2 hours]


Understand the role of promotion in marketing.

Show awareness of different forms of promotion.

Recommend an appropriate method of promotion for a product.

Class activities

1. Ask the class to identify two products or services that are currently being promoted in their town. Get them to state the form that the promotion takes – for example, low introductory prices, special offers, gifts, etc.

2. Get the students to assess how effective they feel the product or service promotion is by justifying their answers with examples.

3.1.11 Marketing strategy [4 hours]


Understand how the marketing mix can be used to develop a marketing strategy.

Appreciate how a marketing strategy helps a business achieve its marketing objectives.

Class activities

1. Use the case study ‘Tesco’s fresh and easy’ on page 100 to help reinforce the idea of a marketing strategy.

2. Use the case study ‘Unilever washing powder in Brazil’ on page 101 to practise decision-making in developing a suitable marketing strategy.

3.1.12 Marketing budgets [2 hours]


Understand the concept of a marketing budget.

Appreciate the idea of cost effectiveness.

Class activities

1. Use the activity on page 103 to help class understanding of a budget as a means of allocating capital.

2. Reinforce the importance of cost effectiveness in using capital appropriately. Use the activity as a teaching aid.

3.2 Production [Operation Management]

3.2.1 Using resources to produce goods/services [2 hours]


Understand the concepts of inputs and output.

Understand the difference between production and productivity.

Understand how productivity can be measured /difficulties of measurement.

Appreciate the importance of productivity.

Class activities

1. Research into a local business. Find out what resources they buy in. Look to see what is produced and thevalue of goods produced. Assess how productive the business appears to be.

2. Do the calculations for summary question 2 on page 107. Discuss what the answers mean.

3. Discuss why an increase in productivity is of benefit to a business.

3.2.2 Methods of production [3 hours]


Understand the difference between job/batch/flow production methods.

Understand the features and characteristics of the methods.

Appreciate the circumstances when each might be used.

Understand the consequences to a business of these methods in terms of output/unit costs.

Class activities

1. Research into local businesses and identify what production methods they use. Investigate whether these results are what the students would have expected.

2. Get the class to look at the following three questions:(a) Why might a local cake shop use batch methods of production?(b) Why would a major car manufacturer use flow methods?(c) What type of businesses use job methods and why is this?

3.2.3 Scale of production [2 hours]


Understand the concepts of economies and diseconomies of scale.

Understand the reasons why these economies/diseconomies occur.

Interpret data to identify whether economies are occurring.

Class activities

1. Give the class data concerning the output and total costs of a business at different levels of output. Students then calculate the unit costs and discuss whether economies of scale have occurred.

2. Students should research into a business that has grown over time. Consider what financial advantages it will have gained as a result of its growth.

3. Discuss whether a business can continue to grow indefinitely.

3.2.4 Lean production [1 hour]


Appreciate the concept of lean production.

Be aware of the methods used to increase ‘leanness’.

Class activities

1. Use the case study ‘The Toyota production system’ on page 112 to develop an understanding of the concept of lean production and the elimination of waste.

3.2.5 Costs and cost classification [2 hours]


Understand the different types of costs incurred by a business.

Understand how costs can be classified into fixed /variable

Construct and interpret a diagram illustrating the cost structure of a business

Class activities

1. Provide the class with a list of ten costs that a typical business has. The exercise is to classify the costs into fixed and variable explaining why the reasons for the classification.

2. Carry out summary question 3 on page 117. Emphasise the need for sensible scales on the graph.

3.2.6 Break-even analysis and decision-making [3 hours]


Understand the nature of break-even analysis.

Construct and interpret a break-even chart.

Appreciate its use in helping with decision-making.

Recognise the limitations of the method.

Class activities

1. Use the case study ‘Break even for schoolbooks’ on page 119 to reinforce the method of break-even analysis and its use as a planning technique.

2. Provide the class with data showing the costs and revenue of a business. Instruct the class to compile a break-even chart and interpret the results. (Make sure that: students label axes; label the revenue and cost lines; show the break-even volume and break-even value]

3.2.7 Quality control [1 hour]


Understand what quality control means.

Appreciate how it is achieved.

Understand why quality matters.

Class activities

1. Get the class to look at the quality standards that an item of electrical equipment has to conform to. Think about why this matters to the customer /business.

2. In groups, get the class to investigate what standard bodies exist in your country? What products do they cover?

3.2.8 Location decisions [3 hours]


Identify the factors that influence location decisions of a business.

Make decisions regarding an appropriate location for different types of business.

Apply the concepts to international location decisions.

Class activities

1. Research into a business that has just set up in a new location. Investigate the factors that might have influenced its choice.

2. Suggest five different businesses and get the class to decide what factors would be important to these in deciding where to locate.

3.2.9 Production efficiency [2 hours]


Understand the concept of efficiency.

Understand methods that can be used to improve efficiency.

Class activities

1. Explain the concept of EPOS. Discuss how it might help long-term efficiency in a business.

2. Ask the class to consider how the use of computers has improved the efficiency of:(a) student research (b) business operation?

4. Human resources [people in business]

4.1.1 Role of work in satisfying human needs [3 hours]


Understand concept of human needs.

Develop an appreciation as to how work helps satisfy such needs.

Class activities

1. Ask students to consider what would be important to them in any job they might get in the future. Is the money paid the only thing that matters?

2. Consider with the class the ‘human needs’ that a teacher might achieve in their job. Get the students to use summary question 1 (page 149) to reinforce their points.

4.1.2 Financial rewards [2 hours]


Understand the different ways of paying employees.

Appreciate the implications of these different methods to businesses and employees.

Class activities

1. Get the class to look at some job advertisements and to identify the financial rewards that different jobs offer.

2. Ask the question: ‘Would you like to be paid by the amount of work that you do or by some other criteria like hours worked?’ Draw conclusions from the discussion highlighting the implications of the alternative methods.

4.1.3 Non financial rewards [3 hours]


Understand the nature of non-financial rewards.

Appreciate the implications of non-financial rewards.

Class activities

1. Give the class three job advertisements that include details of a range of fringe benefits offered to the applicant. Get the class to identify the benefits and consider how attractive they are to an applicant.

2. Consider the reasons why a company might offer fringe benefits to their employees.

4.1.4 Motivation [3 hours]


Understand the concept of motivation.

Show awareness of the importance of employee motivation to the operation of a business.

Class activities

1. Ask students to consider how well motivated they are towards their school work. Consider the reasons why some are better motivated than others.

2. Use the case study ‘100 best companies to work for’ on page 155 to illustrate how companies try and motivate employees.

4.1.4 Management styles [3 hours]


Understand the role of management in influencing employee motivation.

Understand the different styles of management.

Appreciate how different styles impact upon employee motivation.

Class activities

1. Ask the question: ‘When should the management of a business use:(a) an autocratic management style(b) a democratic management style?’ and draw out valid conclusions.

2. Ask the class whether they would prefer to work for a company that used autocratic or democratic methods. They must justify their reasons.

4.2.1 Recruitment and selection process [4 hours]


Be aware of the difference between internal and external recruitment.

Understand the implications of the different approaches.

Understand the stages of the recruitment process.

Understand the difference between a job specification and a job description.

Class activities

1. Brief a role-play exercise that covers both internal and external recruitment. You could use the following example: A hotel manager has just left their job. The hotel is part of a large chain; it is expensive and caters for both business and holiday customers. Get the students to draw up a job description and job specification for the hotel manager vacancy.

2. Ask the class to consider some of the issues facing the selection panel and the candidates. Write the brief for the following roles:(a) The people from head office interviewing the candidates (what are they looking for/what questions will they ask?)

(b) The internal applicants (why do they want promotion?)(c) The external applicants (why do they want to join?)

3. Now allocates students with roles and start the exercise - the objectives are:(a) to increase understanding of recruitment (b) to improve understanding of business terminology (c) to enhance decision making skills (d) to develop the students’ communication skills.

4.2.2 Training [2 hours]


Show awareness of the distinction between internal and external training methods.

Appreciate the nature of training.

Show understanding of the importance of training to the employee and employer

Class activities

1. Perhaps some of the class have had a part-time job. If so, get them to tell the class what training, if any, they were given.

2. Use the case study ‘Group training in Australia’ on page 165 to reinforce the concepts of on- and off-the-job training.

4.2.3 Dismissal and redundancy [1 hour]


Understand the difference between dismissal and redundancy.

Appreciate the circumstances that lead to ‘down-sizing’ a business.

Awareness of the implications of redundancy on both employees and employers.

Class activities

1. Gather information about three companies that have been reducing the number of workers they employ. Discuss the reasons why this has happened with the class.

2. Ask the class to try and find out what redundancy compensation legislation exists in your country (if any).

2. Financing Business Activity

2.2.1 The need for funds [1 hour]


Understand why a business needs funds.

Appreciate the difference between capital needs for start-up and running.

Class activities

1. Use the case study ‘Sanjay’s market research’ on page 70 to develop understanding of the start-up costs of a business.

2.2.2 Sources of funds [1 hour]


Appreciate the difference between short- and long-term capital needs.

Class activities

1. Use the case study ‘Dairy farming in Pakistan’ on page 72 to develop understanding of the difference between working capital and long-term capital.

2. Introduce a number of circumstances where a business needs capital. Students have to decide whether this is a short- or long-term need. They then consider how the business might raise the capital needed.

2.2.3 Sources of internal and external funds [2 hours]


Understand the difference between internal and external sources.

Understand the significance of different sources to the business.

Class activities

1. Uses the table on pages 74 and 75 to explain the different potential sources of external funds available to a business. Focus on explaining the implications of the alternatives in terms of the amount of capital that could be raised, and the risk taken by a business in using that option.

2.2.4 How to choose finance [2 hours]


Appreciate what needs to be considered in making choices.

To apply these factors to a given situation.

Class activities

1. Pages 78–79 contain three longer case studies of businesses that need capital for different reasons. These should be looked at carefully to make sure that the students understand the different circumstances faced by the businesses. The questions should be tackled with emphasis placed on why the business needs capital, what sources might be appropriate to use and will they find it easy to raise the capital.

3. Financial information and decision-making

3.3.1 Cash and cash flow forecasts [3 hours]


Understand why cash is important.

Appreciate the concept of cash flow.

Construct and interpret a cash flow statement.

Class activities

1. Use the case study ‘Calculating cash flow for Tarun’ on page 126 to teach the basis of a cash flow statement.

2. Use the case study ‘Pritesh’ on page 127 to increase familiarity with a more complex cash flow statement.

3.3.2 Profit [1 hour]


Appreciate the concept of profit.

Show awareness of the difference between gross and net profit.

Ability to calculate profit from given data.

Class activities

1. Carry out the activity on page129 to develop basic understanding of the difference between gross and net profit.

2. Develops other similar examples for the class. Practise with calculations makes perfect!

3.3.3 The profit and loss account [2 hours]


Understand the elements in a profit and loss statement

Ability to interpret and analyse profit and loss statements

Show awareness of the difference between retained profit and distributed profit

Appreciate the difference between profit and cash

Understand the relationship between profit and risk

Class activities

1. Use the case study ‘Cooking pots’ on page 131 to establish the basic relationships between items in a profit/loss account.

2. Use summary question 1 on page 131 to help reinforce the concept of a simple profit/loss account.

3. Use the case study ‘Nintendo’ on page 132 to help develop an understanding of how profits are made.

4. Use question 2 in the case study ‘Nintendo’ to consider the link between profit and risk.

5. Use summary question 3 on page 133 to reinforce the significance of the difference between cash and profit.

3.3.4 The balance sheet [2 hours]


Understand the difference between assets and liabilities.

Appreciate the difference between fixed and current assets.

Appreciate the difference between long-term and current liabilities.

Class activities

1. Use the balance sheet given in Figure 9.5.2 on page 135 to develop understanding of the structure of this statement.

2. Make sure that the distinction between fixed assets and current assets is understood. Use examples of both to reinforce the distinction.

3. Make sure the distinction between long-term and current liabilities is understood. Use examples of both to reinforce this distinction.

4. Use the summary question 2 on page 135 to give students an opportunity to use simple figures to construct a balance sheet.

3.3.5 Interpretation of financial statements [4 hours]


Understand concepts of gross and net profit margins.

Understand the concepts of current and acid test ratios.

Understand the concept of return on capital employed (ROCE).

Appreciate the concept of financial gearing.

Understand how judgements about the performance of a business can be made using financial ratios.

Class activities

1. Use the activity on page 137 to help develop understanding of gross and net profit.

2. Use the activity on page 138 to help develop understanding of ROCE.

3. Use case study ‘Pina Mistry’s balance sheet’ on page 139 to help develop understanding of the structure of balance sheets.

(N.B. The aim of these exercises is to improve ability of students to calculate and interpret simple financial statements. Plenty of practise is advised.)

3.3.6 Working capital [1 hour]


Understand the concept of working capital.

Appreciate the concept of liquidity.

Class activities

1. Use summary question 1 on (page 141 to help develop understanding of working capital and liquidity ratios.

3.3.7 Financial budgets [1 hour]


Understand the function of a budget.

Class activities

1. Look at the data given on page 142. Make sure the class understands the difference between a budgeted expenditure figure and an actual expenditure figure.

2. Use summary questions 1–3 on page 143 to allow students to calculate variances and to consider their importance.

3.3.8 Users of accounts [2 hours]


Show knowledge of who uses accounts.

Show knowledge of what users look for in accounts.

Appreciate how accounts can be used to help make business decisions.

Class activities

1. Divide the class into groups and give each one a simplified set of business accounts (make sure you do not include too much detail as this will simply confuse students). The groups then represent different stakeholders, such as shareholders, creditors, employees, etc. Get each group to consider the data and decide what relevance it has to their stake. Each group should report back to the class revealing what they have found out about the business.

1.3 The changing business environment

1.3.1 Government Intervention [2 hours]


Understand why government intervention is needed.

Show awareness of the consequences of unregulated business.

Appreciate the impact of such intervention.

Understand how taxes and interest rates affect business.

Class activities

1. Discuss the following issues: (a) identify situations where government intervention might be needed (b) consider what might happen if unregulated businesses operated.

2. Use the case study ‘Paying business taxes in Albania’ on page 27 to help develop an understanding as to how taxes can influence business behaviour.

3. Develop a few numerical questions showing how an increase in interest rates affects business costs and therefore may affect their willingness/ability to borrow capital.

1.3.2 Technology and business [2 hours]


Understand the way technology has impacted upon business.

Appreciate how business has responded to technological change.

Appreciate the impact of e-commerce on both business and consumers.

Class activities

1. Use the activity questions on page 28 to introduce the idea of technology.

2. Show students how technology can change the way we do things, using the internet as an example.

1.3.3 Market changes [1 hour]


Understand the nature of market change.

Appreciate the causes of such changes.

Show awareness of the implications for business.

Class activities

1. Use case study ‘The global steel market’ on page 33 to discuss the implications of change on producers and consumers.

2. Discuss with class the consequences of a business not adapting to the changes in the market in which it operates

1.4 Economic environment

1.4.1 Mixed and market economies [1 hour]


Understand the difference between such economic systems.

Appreciate the implications of the systems in terms of outcomes such as prices and consumer choice.

Class activities

1. Give the class a list of ten different countries. Tell them to find out those that are near ‘pure’ market economies and those that are mixed economies with a lot of government intervention.

2. Use the activity on page 37 to help analyse the mixed nature of your own domestic economy.

1.4.2 International trade [2 hours]


Show understanding of why trade exists between countries.

Appreciate the opportunities and threats that trade offers to business.

Class activities

1. Use the activity on page 39 to illustrate the extent to which trade impacts on everyone’s lives.

1.4.3 Problems of entering new markets abroad [2 hours]


Show knowledge of the problems faced by a business in entering new markets.

Show knowledge of how such problems can be tackled.

Class activities

1. Use the activity on page 41 to develop understanding as to why products need adapting when entering new markets.

2. Discuss how cultural differences between countries causes problems for a business that wishes to trade globally.

1.4.4 Exchange rates and restrictions on trade [2 hours]


Show awareness of how exchange rate movements affect businesses that trade internationally.

Appreciate the difference between a tariff barrier and a quota.

Show awareness of why countries might wish to create barriers to protect domestic businesses.

Class activities

1. Use simple examples to ensure that students understand the difference between a tariff and a quota.

2. Use a numerical example to show how a movement in an exchange rate affects the price of a company’s product when measured in terms of another currency. Use both an appreciation and a depreciation of a currency to illustrate the impact.

3. Perhaps some of the class have been on holiday in another country. Use the exchange rate movements to show whether the changes would have been to their advantage or disadvantage.

1.4.5 Competition and business [1 hour]


Appreciate the impact that competition in markets has on consumers.

Class activities

1. Use the case study ‘Competition in world pineapple markets on page 44 to develop understanding of competition and consumer choice.

2. Consider why competition usually leads to lower prices.

3. Consider whether competition always benefits consumers.

5. Regulating and controlling business activity

5.1.1 Impact of unregulated business activity [3 hours]


Show awareness that business decisions have an impact on others

Appreciate the concept of externalities

Understand who intervenes and why

Show knowledge of the methods of intervention

Class activities

1. Use the case study ‘Sylvia Simms’ laundry’ on page 170 to illustrate the ideas of social costs and benefits, and private costs and benefits.

2. Get the class to give other examples of externalities, both positive and negative.

3. Look at the table on page 172 and apply it to the economic and social objectives of the government of your country.

4. Tell the class about pressure groups that exist in your country. Get the class to research into the activities of these groups to try and find out what they are seeking to achieve.

5. Get the research groups to answer the question: ‘What the methods do pressure groups use to try and achieve their objectives?’

5.2.1 Location decisions [1 hour]


Understand the factors that affect the location decisions of business.

Be able to apply such factors to a given situation.

Understand why governments how and why governments might wish to influence such decisions.

Class activities

1. Use the activity on page 179 to develop understanding of government involvement in location decisions of business in your country.

5.2.2 Work force and working environment [3 hours]


Appreciate the role of trade unions.

Understand how trade unions can influence the behaviour of business.

Appreciate the concept of business ethics.

Understand why employees might need protection at work.

Understand the main ways employees are protected at work.

Appreciate the concept of contracts of employment.

Show awareness of the importance of health and safety requirements.

Class activities

1. Give the class the names of three trade unions that exist in your country to research into the activities of these unions: (a) which industries do they operate in?(b) how many members do they have?(c) what have the unions achieved for their members?

2. Identify any laws that exist in your country concerning people at work – for example, employment laws, health and safety laws, etc. Tell the class to research into these laws and find out how they help employees

3. Use the case study ‘The employment equity act, South Africa’ on page 187 to develop understanding of how laws help tackle discrimination at work.

5.2.3 The consumer [1 hour]


Understand why consumers need protecting.

Show awareness of the impact of legislation on consumer’s rights.

Class activities

1. Use the case study ‘Consumer protection in Jamaica’ on page 189 to develop knowledge and understanding of consumer protection legislation in your own country.

5.2.4 External costs and benefits [3 hours]


Appreciate the concept of social costs and benefits.

Understand how the concept of social costs and benefits occur.

Be able to apply such concepts to a given business decision.

Class activities

1. Look at the table on page 190 and use it to reinforce understanding of the difference between financial costs and benefits, and social costs and benefits.

2. Use the case study ‘The Marrekesh–Agadir motorway’ on page 191 to help to learn to apply the concepts to practical situations.

5.2.5 Exchange rates [1 hour]


Understand the nature of currency appreciation and depreciation.

Show awareness of the impact of such movements on business decisions.

Class activities

1. Use the activity on page 193 to further class understanding of exchange rate movements.

2. Use the case study ‘Single currencies’ on page 193 to identify the advantages of having a single currency.

5.2.6 The business cycle [1 hour]


Show knowledge of the stages of a business cycle.

Show knowledge of a recession and a boom.

Appreciate the impact of these features on business success.

Class activities

1. Discuss with the class what stage of the business cycle your country is currently in. Do this by using the assessment indicators given on page 194.

2. Get the class to draw and label a business cycle. Insert each feature of the cycle at the correct point – for example, during a boom employment is rising/output is increasing, during a bust employment is falling/output is decreasing, etc.

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