Professional Documents
Culture Documents
4a-B Review
4a-B Review
Sam Cleveland, the CEO of the business, identified that changes would need to be
made to improve Cleveland’s Chocolatiers performance. Sam decided that the business
should focus on providing higher quality gourmet chocolates. Sam stated the business
should aim to compete with quality rather than on prices. Sam believes that the business
should stop the production of their standard chocolate range. Sam believes the switch to
higher quality chocolates will bring long-term success for Cleveland’s Chocolatiers.
At the start of 2019, Sam decided to implement the changes needed to produce the new
gourmet chocolates. Sam decided to increase investment in technology. Sam purchased
new state-of-the-art equipment from Belgium, capable of producing high-quality gourmet
chocolates with little human interaction required. Sam believes this equipment will also
assist Cleveland’s Chocolatiers in minimising their impact on the environment. This
would help the business become more socially responsible. As the production of
chocolates will now require less labour, Sam has decided to make 50 of the 200
employees at Cleveland’s Chocolatiers redundant. After their second year of operating,
Sam decided to review a range of key performance indicators to assess if the
performance of Cleveland’s Chocolatiers improved. These key performance indicators
are shown in the table below.
Define the term ‘business change’. 1 mark
Explain how Cleveland’s Chocolatiers could use net profit figures to measure their
performance following the introduction of new machinery. 2 marks
Net profit figures are the amount of money left over after expenses have been deducted from revenue
earned. This can be used to measure their performance by seeing how much money they have made
during different periods and comparing them.
Identify and explain a key performance indicator that Sam could use to assess the
business’s current impact on the environment.
One KPI that Sam could use is level of wastage. Level of wastage is the amount of resources and finished
goods that are discarded during the production process. This can help Sam assess their impact on the
environment by seeing how much waste they are creating and how sustainable they are.
Identify and explain a key performance indicator that Sam could use to measure the
current level of staff morale at Cleveland’s Chocolatiers. 2 marks
One KPI that Sam could use for measuring staff morale is through rates of staff absenteeism. Rates of staff
absenteeism are the number of employees that do not turn up to work when expected to be there. This
can measure staff morale by seeing if employees are demotivated and thus aren’t coming in when they’re
supposed to be.
Apart from those shown in the table, identify and explain two other key performance
indicators that could be used to measure Cleveland’s Chocolatiers performance from
2018 to 2019. 2 marks
One key performance indicator that Cleveland’s Chocolatiers could use is the rate of productivity growth.
Rate of productivity is the amount of outputs produced compared to the amount of inputs used and the
rate at which it increases over time. Another key performance indicator that Cleveland’s Chocolatiers
could use is the level of wastage. Level of wastage is the amount of resources and finished goods that are
discarded during the production process.