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Examiners' commentaries 2021

Examiners' commentaries 2021

FP0010: Business Management

Important note

This commentary reflects the examination and assessment arrangements for this
course in the academic year 2020–2021. The format and structure of the examination
may change in future years, and any such changes will be publicised on the virtual
learning environment (VLE).
Information about the subject guide and the Essential reading references
Unless otherwise stated, all cross-references will be to the latest version of the subject
guide (2021). You should always attempt to use the most recent edition of any
Essential reading textbook, even if the commentary and/or online reading list and/or
subject guide refer to an earlier edition. If different editions of Essential reading are
listed, please check the VLE for reading supplements – if none are available, please
use the contents list and index of the new edition to find the relevant section.

General remarks

Learning outcomes
At the end of this course and having completed the Essential reading and Activities, you
should be able to:
• Identify basic business structures and their functions. •
Identify risk and major changes in the external business environment and assess the
impact of these on business. • Analyze and discuss how managements make their
choices regarding strategies and the theoretical models that help these to be implemented
successfully. • Analyze and discuss ways by which businesses can pursue their aims
and objectives with effective management of resources including Marketing, Human
Resource Management, Finance and IT.

• Provide a business critique of contemporary events, review the options available and
recommend remedies and actions.

What the examiners are looking for In good

examination answers, you will show that you understand the question and are able to
cover the specifics of the topic or issue: do not be tempted to write all you know about a
topic or deliver an answer to a question that is not actually in the paper.
Managing your time is important so that your answers to the short questions are brief
(around a paragraph in length) and focused. Candidates should note that they should

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FP0010: Business Management

spend about one minute of their time per mark and the length of their answer should
reflect this.
Finally, you are strongly advised to constantly develop your essay-writing skills, which
will be appropriately rewarded. A structured essay with a clear line of argument that is
backed by good knowledge and analysis, retaining its focus on the question wording,
will achieve high marks. A full hour should be devoted to the essay and a good answer
will run to about 500 words or more: many answers do not come close to this and
therefore lack depth and detail.
The remarks in the following commentary are not intended as indications of model
answers but as suggestions about how a good answer might be produced. Your
approach may be different but equally valid and if you have read widely, completed
all the recommended activities and followed global business news coverage then you
can approach the examination with confidence.

Sections of the examination

Sections of the examination This examination is divided into three sections as follows.
Section A (worth 30%) – Knowledge of key terms and concepts.
Section B (worth 30%) – applying economic analysis to an unseen article, including
data interpretation, known as 'stimulus response
Section C (worth 40%) – one of a choice of three essay topics.
Candidates should divide their time accordingly in the examination in proportion to
the mark allocation for each question. Preparation for Section A includes key terms,
basic business models and theories. These are short answer questions with lower
marks than other sections of the paper and designed to test basic knowledge so it is
important that candidates pay attention to timing and do not write lengthy answers.
Section B involves answering questions related to an unseen news article by applying
business knowledge from the course text and background reading. The text the
business topic area and candidates can use analysis of this to bring in their knowledge
of how business theory concerns to the content.
Finally, Section C requires candidates to write an essay. Usually there is not one
'right' point of view, so an excellent essay would consider a number of issues
connected with the question. A good balanced essay would consider both positions
on an issue (for example, Question 12 invited comment on the significance of
environmental issues on business) before concluding on the most significant.
Candidates should remember that in Section C you are to write one essay in about
an hour. You are advised to draw up a brief plan for the essay which the examiner
can review in case you do not have time to finish. Good essays are well structured
and set out to answer the question asked not another question. You should always
aim to present a clear line of argument which is supported by a range of knowledge
and examples drawn from your reading. You will be rewarded for an essay that:
• has an introduction which sets out the terms of the essay and offers the reader a
view of its thesis
• includes three or four main points •
has a conclusion which you originally stated in your introduction and has now been
justified by the evidence and analysis of the middle section. Make sure your
introduction and conclusion support each other.

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Examiners' commentaries 2021

A strong essay is the key to a really high grade overall so make sure you leave
enough time for this and do not spend too much time on questions which carry low
marks.

Reading the question Read

the question carefully before you start writing the answer. Make sure you know what
the main topic of the question is and answer this question.

Examination revision strategy

Many candidates are disappointed to find that their examination performance is

poorer than they expected. This can be due to a number of different reasons and
the Examiners' commentaries suggest ways of addressing common problems and
improving your performance. We want to draw your attention to one particular
failing – 'question spotting', that is, confining your examination preparation to a
few question topics which have come up in past papers for the course. This can
have very serious consequences.
We recognize that candidates may not cover all topics in the syllabus in the same
depth, but you need to be aware that examiners are free to set questions on any
aspect of the syllabus. This means that you need to study enough of the syllabus
to enable you to answer the required number of examination questions.
The syllabus can be found in the Course information sheet in the section of the
VLE dedicated to this course. You should read the syllabus very carefully and
ensure that you cover sufficient material in preparation for the examination.
Examiners will vary the topics and questions from year to year and may well set
questions that have not appeared in past papers – every topic on the syllabus is
a legitimate examination target. So although past papers can be helpful in revision,
you cannot assume that topics or specific questions that have come up in past
examinations will occur again.
If you rely on a question spotting strategy, it is likely you will find yourself
in difficulties when you sit the examination paper. We strongly advise you
not to adopt this strategy.

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FP0010: Business Management

Examiners' commentaries 2021

FP0010: Business Management

Important note
This commentary reflects the examination and assessment arrangements for this
course in the academic year 2020–2021. The format and structure of the
examination may change in future years, and any such changes will be publicised
on the virtual learning environment (VLE).
Information about the subject guide and the Essential reading references
Unless otherwise stated, all cross-references will be to the latest version of the
subject guide (2021). You should always attempt to use the most recent edition
of any Essential reading textbook, even if the commentary and/or online reading
list and/or subject guide refer to an earlier edition. If different editions of Essential
reading are listed, please check the VLE for reading supplements – if none are
available, please use the contents list and index of the new edition to find the
relevant section.

Comments on specific questions

Candidates should answer ELEVEN of the following THIRTEEN questions: ALL
SIX from Section A (30 marks), ALL FOUR from Section B (30 marks) and ONE
from Section C (40 marks).

SECTION A

Answer all questions from this section.

Question 1

What is Total Quality Management?

Reading for this question
Boddy (2016) p.598.
Approaching the question
Any five of the following would be acceptable:
• customer focus
• cover • inclusive •
measured • comprehensive
methodical.

Question 2

What is strategy? Whose responsibility is this normally?

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Reading for this question

Boddy (2016) p.241.
Approaching the question
This question requires a definition followed by a selection of the management level
(senior). Any of the following are also acceptable:
• deciding •
organising •
responsibility for major decisions •
resourcing.

Question 3

What is a break-even analysis? Give an example of its use.

Reading for this question
Boddy (2016) p.589 and Surridge and Gillespie (2019) as outlined in the subject guide
Unit 4 background reading.
Approaching the question
This question requires a definition. Boddy (2016) break-even in the context of selling.

Question 4

What is the difference between a company's resources and its capabilities?

Reading for this question
Boddy (2016) pp.251–252.
Approaching the question
Candidates need to distinguish between the two coherently. The basic response is
that resources are tangible and competencies are the company's ability to act
effectively in certain circumstances.

Question 5

What are the characteristics of good information? Illustrate with three examples.

Reading for this question

Boddy (2016) p.383.
Approaching the question
Any three of the following are acceptable:
• timely •
accurate
• relevant
• understand
• focused
• personally directed.

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FP0010: Business Management

Question 6

How does transactional leadership differ from transformational leadership?

Reading for this question
Boddy (2016) p.451.
Approaching the question
This question requires candidates to differentiate between the styles by providing a
brief definition of both. Answers should refer to leadership in circumstances of change
in an organization.

SECTION REMOVED

Answer all four questions from this section.

Read the following passage. Use the source and your own knowledge to
complete your answers to the questions below.
Samsung, the world's biggest computer-chip manufacturer, has warned
of a “serious imbalance” in the semiconductor industry, as global
shortages cause disruption. There are growing fears markets shortages
could slow economic recovery after coronavirus. EU, US and Chinese
governments are seeking to boost production.
“There is a serious imbalance in supply and demand of chips in the IT
sector globally,” Samsung's co-chief executive and mobile chief, Koh
Dong-jin, said, “and Samsung was working with overseas partners to
meet demand”, he added. Last month's closure of its chip-fabrication
plant by adverse weather conditions in Texas had exculpated Samsung's
problems. Taiwanese research firm TrendForce estimated the shutdown
could reduce global smartphone production by 5% in the second quarter
of this year. There has also been a fire at a Japanese company, part of
Renesas Electronics, one of the world's biggest makers of
semiconductors for the car industry.
The semiconductor shortage began last year, as the pandemic hit.
Suffering from poor sales, car manufacturers cut their orders from the
Chinese factories making computer chips. In response, the chip supply
from factories was transferred to other sectors that had high demands.
Unable to retrieve canceled orders when demand for cars grew,
Volkswagen, Honda, Toyota and General Motors all had to reduce
production.
Meanwhile, as technology sales boomed, the Covid-19 pandemic has
driven up demand for semiconductor chips for use in electronics such
as computers, as people worked from home, and suppliers are
struggling to adjust. Apple staggered the release of some iPhones, and
the latest models of Xbox and PlayStation consoles are selling out.
Quilter Cheviot analyst Ben Barringer said: “Growing trade research
between the US and China semiconductor industry in uncertainty, even
before the pandemic. This shortage illustrates how important certain
countries have become in terms of supply chain - and how important
access to semiconductors is.”

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Examiners' commentaries 2021

France's Renault has warned that the chip shortage was worsening.
Modern cars contain complex electronics and are heavily reliant on
semiconductors, which are used in systems ranging from engine
management to parking cameras, driver aids and electronics and the
entire industry is struggling to get enough of them. It's fighting the
consumer electronics sector for the supplies that are available.
Carmaker Stellantis, which owns the UK Vauxhall brand, has said it
would replace digital speedometers with more old-fashioned analogue
ones in one of its Peugeot models, as the fallout continues. Daimler,
General Motors and Volkswagen have all suspended production lines at
various times in recent weeks.
All of these need semiconductors, and what has made the auto industry
particularly vulnerable is its reliance on just-in-time delivery, where parts
are brought in when needed, rather than being stockpiled.
Normally, this is seen as the efficient way to do things - but the
semiconductor shortage has shown just what can happen when normally
well-oiled supply chains seize up. Further disruption over the coming
weeks and months is inevitably, because it takes time to increase chip
production. The question now is what carmakers can do to ensure they
aren't caught out by a similar supply squeeze in future.
Source: adapted from BBC Business online 2021

Question 7

What is the effect on business of problems with the supply chain? Give three
examples.
Reading for this question
The supply chain is referred to in Boddy (2016) pp.96–97 and p.589, and Surridge
and Gillespie (2019) pp.179–188.
Approaching the question
A good answer blends material from the source with some own knowledge. A majority
of candidates were able to supply a definition of what supply chain management
involved. Good answers included reference to the sequence of suppliers who help to
make a business or organization efficient and explained how disruption to this
sequence will have consequences in other parts of the business such as finance,
sales and customer relations and may require adjustments to the longer business
strategy.

Question 8

Give two examples of the weaknesses of the suppliers of semiconductors that

have been revealed by the pandemic.
Reading for this question
Boddy (2016) pp.96–97, pp.119–120 and Surridge and Gillespie (2019) pp.461–465.
Approaching the question
A number of candidates copied parts of the text which describes events but did not go
on to identify the problem in business terms by referring to the effects of the uncertainty
caused by the pandemic and the need for flexibility in business planning;

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FP0010: Business Management

the physical limitations to production in some parts of the world eg the bad weather in the
Texas area and the fire in Japan were also relevant in this answer.

Question 9

Give two examples of the weaknesses of semi-conductor buyers that have been
revealed by the pandemic.
Reading for this question
Boddy (2016) pp.96–97, pp.117–120 and Surridge and Gillespie (2019) pp.461–465.
Approaching the question A
number of candidates copied parts of the text which describes events but did not identify the
problem in business terms by referring to the failure to anticipate the effects of the pandemic
as an external factor.

Question 10

What are three ways that of semiconductors can protect themselves from buyers
shortages of semiconductors in future and what might be the results?
Reading for this question
Boddy (2016) pp.96–97, pp.117–120 and Surridge and Gillespie (2019) pp.461–465.
Approaching the question
Most candidates were able to supply some solutions to the issue should it arise in the future.
Good answers identified the stated problem of the semi-conductor buyers.
This was an unexpected shortage of conductors for their key production lines. Higher demand
from the EU, US and China is expected in future and thus, firstly: companies should establish
better environmental monitoring processes so that threats in the external business
environment, such as the pandemic, are modeled and planned for; overreliance on a few
countries for chip production represents another risk in the supply chain and producers need
to consider how they could use lower grade technology in times of short supply; just-in-time
delivery processes could be replaced by better inventories or by companies purchasing
suppliers in a vertical integration.

OLD SECTION

Answer one question from this section.

Question 11

Using your business knowledge, illustrates how Human Resource practitioners can
use job analysis to create an effective job description. Explain how this can aid in
effective recruitment policy which supports equality and diversity.
Reading for this question
Boddy (2016) pp.357–362, pp.366–367 and Surridge and Gillespie (2019) pp.287– 288,
pp.256–259.
Approaching the question A
good way to approach this question would be to make clear definitions and distinctions
between the HR role of recruitment and the nature of a job description. A good answer will
include the process by which staff are recruited and the advantages of a diverse workforce.

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Question 12

Explain corporate social responsibility (CSR) in business. Using your business

knowledge, critically discuss the effect that the adoption of environmental
strategies and targets might have on a business.
Reading for this question
Boddy (2016) p.145, pp.159–160, p.163 and Surridge and Gillespie (2019) pp.397–
398, pp.447–450.
Approaching the question
A good response to this question will include a clear definition of what corporate
responsibility means in an organization in its governance and ethical position. The
answer would also how business might respond to accusations of causing
environmental damage and consider policies which improve their relationships with
stakeholders and their performance as well as avoid harm.

Question 13

Why is it important for a business to understand its customers? Using your

business knowledge, critically assess the effective use of at least two methods
of customer relationship management (CRM).
Reading for this question
Boddy (2016) Chapter 12 and Surridge and Gillespie (2019) pp.106–109.
Approaching the question
This was a popular question with candidates and a good answer would first include
an outline of the reasons for creating and maintaining a relationship with customers
beyond simply transactions and how this knowledge contributes to management
strategy and planning. The answer would then go on to include how this data and
information can be used in marketing activity such as segmentation and targeting with
some examples. After this, there would be a discussion of how technology can be
used in this process by Customer Relationship Management systems which can also
be used to support quality management processes.