AS BUSINESS
CONTENT
COMPONENT 1
Content Amplification
Enterprise Explain the meaning of enterprise and SMEs
Explain how satisfying needs and wants can
give opportunities to entrepreneurs
Identify business opportunities
Explain the role of the entrepreneur in
creating, setting up, running and developing
a business
Explain the financial and non-financial
motives of entrepreneurs
Explain the characteristics and skills of
entrepreneurs
An enterprise has 2 common meanings:
 Firstly, an enterprise is simply another
name for a business.
 Secondly, and perhaps more importantly,
the word enterprise describes the actions
of someone who shows some initiative by
taking a risk by setting up, investing in
and running a business.
An SME is small or medium – sized enterprises
These are defined by the European Commission as
businesses that:
 Have fewer than 250 employees
 Have an annual turnover (sales revenue)
of less than approximately £40 million
- Needs – economists say that needs are what
people require to survive – for example, food,
warmth, shelter and clothing. We could also
include education, healthcare and security – being
safe.
- Wants – what we desire, what we would like to
have. For example, nicer clothes, not just basic
functional items, a new phone every year, a
massive flat screen TV, a detached house with pool,
holidays in the Maldives etc.
An entrepreneur is someone who starts and runs
a business. Perhaps he or she makes a product and
then
sells that product, or perhaps they provide a
service. They quite possibly employ people and, of
course, try to
make a profit.
• Being a risk taker – entrepreneurs are not
always about new products or new ideas. They are
often just doing things better than they were done
before. However, they are all risk takers – they risk
capital and their own time to try to create profits.
They may remortgage the house, borrow from
friends and family, or give up well-paid jobs to try
to make a success out of their business idea.
• Taking the initiative and being proactive –
successful entrepreneurs are able to take the
initiative when required. They do not panic and
allow events to overwhelm them – they are
proactive and able to change as needed.
 • Being an effective organiser – an ability to
organise effectively is central to running a business
effectively. The entrepreneur may need to
undertake a wide range of activities; from hiring
labour and buying inputs, such as raw materials, to
producing the finished product for sale.

• Having creativity and being innovative –

creativity in business means the ability to come up
with innovative concepts and ideas, or developing
a better way of doing things. Two American college
students working in their college dorm in 2003 had
the view that there had to be a more efficient way
of gathering data for internet search engines – we
now have Google, one of the biggest brands in the
world!

• Being hard working – successful entrepreneurs

are, generally, hard working. It is estimated that
entrepreneurs in the UK work for around an
average of 52 hours a week, plus another 40 hours
thinking or worrying about their business venture.
Compare this to the average working week of 38
hours for an employed person.

• Being determined and having perserverance –

entrepreneurs also need to be determined, as new
businesses have low success rates. Entrepreneurs
must also have considerable perseverance, and be
willing to keep trying if initial ideas fail
Explain the importance of entrepreneurs and  In the primary sector, providing the food
SMEs to the primary, secondary and tertiary we need, farming, supplying the power we
sectors of the UK economy use through mining or extracting oil from
the North Sea
 In the secondary sector: private
enterprises provide us with a massive
amount of consumer goods; manufacturing
cars, processing food, making clothes,
designing and producing consumer
electronics – in fact all the goods that
surround us in the shops we visit, that help
satisfy our every want.
 In the tertiary (service) sector: private
companies provide gyms, offering financial
advice, operating fleets of buses and
trucks, prepare marketing campaigns and
so much more
Evaluate the impact of entrepreneurs and
SMEs on businesses and the economy
Identify the various stakeholders who are
affected by a business
Business Explain the purpose and main components of 1. An executive summary:
plans a business plan - Short & compelling to persuade the reader to
want to read on and invest.
- Normally focuses on the team, the product and
the finances.
2. The business and its objective:
- The name of the business
- The name and employment history of the
entrepreneurs who own the business
- The objectives of the business
3. The business opportunity:
- A description of the product or service
 - USP
4. The market:
- Mass or niche
- Market trends
- Market measurements (size, share, growth)
- Competition
5. The marketing plan:
- Based on market research – primary and
secondary
- Target market
- Product – including sales forecasts; for the first
2 years
- Price – How much will you charge?
- Place – how will you distribute your products
to your customers?
- Promotion – how will you communicate with
your target market?
6. Operational plan:
- How will the product be produced?
- How will the product be delivered? What
distribution channel will be used?
- Suppliers
7. Financial plan:
- Cash flow forecast (this is about cash)
- Budget (this is about profit)
8. Personel (Human resources/People)
- How many people will you need to employ?
- What hours of work?
- Rates of pay?
9. Premises and equipment:
- Where will your business be located?
- What equipment do you need to operate your
business?
10. Conclusion
- Longer term plans for the business
- Is there an exit strategy?
Evaluate the importance of a business plan
Identify the main sources of information and
guidance available to entrepreneurs
Markets Explain what is meant by a market and
competition
Identify different types of market, including
local/global, mass/niche, trade/consumer,
product/service and seasonal
Analyse and interpret market data, including
market size, market share and market trends
Explain what is meant by market
segmentation
Explain how markets are segmented
Evaluate the importance and impact of
segmentation to a business and its customers
Understand that different markets have
differing degrees of competition, ranging
from perfect competition to monopoly
Explain the features of perfect competition,
monopolistic competition, oligopoly and
monopoly and their impact on business
behaviour
Understand the reasons why consumers
sometimes need protection from exploitation
from businesses
Explain what is meant by demand, supply
and equilibrium
Understand the importance of demand and
 supply in the market
Explain the factors that lead to a change in
demand and supply
Explain how a change in demand and supply
can impact on price and quantity
Construct and interpret demand and supply
diagrams
Understand the factors that cause the demand
and supply curves to shift and the effect this
has on equilibrium price and quantity
Analyse and evaluate factors which affect
demand and supply and equilibrium
Understand the concept of price and income
elasticity of demand (learners are not
required to do calculations)
Explain the nature of inferior, normal and
luxury goods
Explain what is meant by market research
Explain the value of carrying out market
research
Distinguish between primary and secondary
market research
Distinguish between qualitative and
quantitative data
Explain the different methods of primary and
secondary research available to businesses
Explain the issues involved in selecting the
Market most appropriate method of market research
research Evaluate the use of the different methods of
primary and secondary research
Interpret and evaluate quantitative and
qualitative research
Explain what is meant by sampling
Explain the difference between random and
quota sampling methods
Understand the need to avoid bias in market
research
Evaluate the usefulness of sampling for a
business and its stakeholders
Content Amplification
Business Explain the difference between the private and  The public sector is made up of
structure public sector organisations that are owned and run by
the government
 The private sector is operated by
businesses owned by shareholders or
private individuals
Explain the aims of private sector businesses Survival: In the shorter term this can be more
including survival, growth and profit important than making profits as the majority of
new businesses fail within the first two years. For
a small business, the initial objective is to survive
the difficult start-up time of gaining customers,
establishing a good local name, and building a
reputation. Larger businesses may also have this
objective as a priority during recessions when the
market is very competitive

Gaining market share: Businesses may spend to

gain customers, reducing profits in the short run,
but hopefully increasing profits in the longer
term. Some may concentrate on establishing their
brand name, becoming the most recognised
business in their market. This costs money, so
reduces profits

Improving ethics: For example, there are

businesses that will try to minimise the impact of
their activities on the environment or ensure that
their suppliers get a good deal. Such ethical
objectives are likely to increase costs and reduce
profits.

To increase shareholder value: Measured by the

dividend paid and the share price. Often the main
objective for directors of limited companies. Many
senior managers have bonus schemes related to
increasing share prices and dividends; achieving
the targets within these schemes will then become
the main focus of the business

To make a profit: To make a return on the capital

(money) invested in the business. Profit
maximisation is a key expression when
considering how successful a business is.
Explain the aims of the public sector and its • Access
role in providing goods and services – available to all regardless of
location or income
• Quality
– high quality services that do not
cut corners
• Affordability
– services offered at prices that are
cheaper than private sector or
free at the point of use
• Equity
– available to anyone whatever
their background, status, income,
class, race, religion, etc.

Evaluate the roles of the public and private • PUBLIC GOODS – goods where consumed by
sectors in the provision of goods and services one person does not reduce the amount

Explain the legal structure of different private
sector business organisations including sole
traders, partnerships, private and public
limited companies
Explain what is meant by unlimited and
limited liability
Explain the advantages and disadvantages of
choosing different legal structures for a
business
available to others, and once provided, all
individuals will benefit. E.g. street lighting,
policing and defence.
PUBLIC GOODS – have two features:
• Non-rivalry – consumption of the good by
one individual does not reduce the amount
available for others, e.g. justice in the law
courts.
• Non-excludability – it is impossible to
exclude others from benefiting from their use,
e.g. street lighting.
• These public goods are provided free at the
point of use and are paid for from taxation.
 MERIT GOODS – goods which are
underprovided by private sector businesses;
for e.g. education and health care.
• Merit goods are provided as some consumers
could otherwise not afford the goods and
others would fail to see the full benefit of
consuming these goods.
• The provision of merit goods is paid for
from taxation and it is said to raise society’s
standard of living.
A sole trader is a type of business owned and run
by one person but more people can work there
Partnerships: A group of people (often with
similar interests) who own and control the
running of a business. By law minimum 2 people –
maximum 20 people
A private limited company: is a registered
business with shareholders and directors. The
public cannot purchase shares in a limited
company from the stock exchange
A public limted company: is a registered business
with shareholders and directors, they are able to
offer its shares to the public. They don't have to
offer those shares to the public, but they can.
Sole traders
1. Advantages:
• Sole traders are easy to set up; it is just a matter of
informing the Inland Revenue that an individual
is self-employed and registering for class 2 National
Insurance contributions within three months of
starting in business.
• Costs are low due to the simplicity of setting up and
no legal formalities, so there is little administrative
cost.
• Also no formal audited accounts are required, though
it makes good business sense to keep a full set
of business records.
• The sole trader benefits from fast decision-making
and may (within employment law) hire and fire as
they please.
2. Disadvantages
• Firstly there is often limited capital. Sole traders often
rely on their own savings and perhaps secured
business loans.
• It is likely that the sole trader will have a limited range
of skills. A sole trader may be an expert
plumber, but is he or she an expert at marketing,
managing staff, and controlling cash flow? With the
need to be effective at all these tasks comes immense
pressure.
• All the decisions and the future success of a business
rest with one person.
• The sole trader has unlimited liability. This means that
the business owner is liable for all the debts of
the business, up to and including the value of all assets
held.

Partnerships
1. Advantages:
• Partnerships involve the joint ownership of a
business. Normally there can be between two and 20
partners, but in certain businesses such as accountancy
firms, there can be many more partners than
this.
• Partnerships are often found in professions such as
lawyers, accountants and doctors, but can be
found in any type of business activity.
• The rules of partnership are laid down in a
Partnership Agreement, or the Deed of Partnership. The
Deed of Partnership lays out such rules of operations as
the amounts of capital invested, the share of
profits each partner is to receive, the roles and
responsibilities of each partner, the voting shares of the
partners, what is to happen on the death of a partner
and the rules for dissolution of the partnership.
• Should a dispute arise without a partnership
agreement giving methods of settling the dispute, then
the dispute would be settled according to the 1890
Partnership Act. This is best avoided, particularly
where unlimited liability is involved, as the act states
that each partner is equally responsible for any
debts – each partner is ‘jointly and severally’ liable.
• There are a number of advantages of the partnership
structure over that of a sole trader. These include
a wider range of skills, greater availability of capital,
shared decision-making, and pressure is likely to
be reduced with different partners having separate key
roles.
2. Disadvantages:
• Capital can still be limited, with the same problems of
raising external capital that a sole trader has.
• The partners still have unlimited liability of partners
(sleeping partners who invest, but take no part in
the day-to-day running of the business can have limited
liability).
• Also partnerships are dissolved on the death of a
partner and this can cause complications in
reestablishing the partnership.
• Although there are many advantages when partners
become involved in a business for the first time
(such as increased capital, greater input into decision-
making, a wider spread of skills), new partners
can, and do, cause strains within a business.

Private limited companies (Ltd)

1. Advantages
• limited liability;
• shares can only be sold if all the shareholders agree –
control is not lost to outsiders;
• capital can be raised through increasing shareholders;
• other businesses and lenders are more likely to trade
and invest;
• the business continues if one of the owners dies;
• possible tax advantages for the owners.
2. Disadvantages
• legal procedure in setting up, increases costs;
• profits have to be shared with shareholders;
 • shares cannot be sold to the public which may restrict
the investment of additional capital;
• financial information is in the public domain.

Public limited companies (Plc)

1. Advantages
• limited liability;
• the business continues if one of the owners dies;
• capital can be raised through selling shares to the
public;
• it is easier to raise finance from banks and other
lenders who are more willing to lend to PLCs;
• they are likely to have economies of scale;
• increased market presence and dominance.
2. Disadvantages
• increased costs in setting up;
• anyone can buy shares so there is an increased threat
of losing control;
• increased legal requirements;
• the company accounts are in the public domain –
more information has to be published than private
limited companies;
• divorce of ownership and control;
• the increased size may result in inefficiencies,
increased costs and distance from their customers.
Evaluate the factors affecting the choice of the
legal structure of a business
Explain the main features of not-for-profit  Modern co-operatives : Most modern
organisations including social enterprises, co-operatives operate as CONSUMER or
charities, co-operatives and societies RETAIL CO-OPERATIVES, They are
owned and controlled by their members.
Members can purchase shares which
entitles them to a vote at Annual General
Meetings. The members elect a board of
directors to make overall business
decisions and appoint managers to run
day to day business. Co-operatives are
run in the interests of their members. Any
surplus made by the co-operative is
distributed to members as a dividend
according to levels of spending. Shares
are not sold on a stock exchange, which
limits the amount of money that can be
raised.
 

 Worker CO-OPERATIVES: This is where

a business is jointly owned by its
employees. A worker co-operative is an
example of a producer co-operative
where people work together to produce a
good or service. Examples might be a
wine growing co-operative or a co-
operative of farmers producing milk. In a
worker co-operative employees are likely
to:
• contribute to production;
• be involved in decision making;
• share in the profit (usually on an equal
basis);
• provide some capital when buying a share
 in the business.
 

 Building and friendly societies: Most

building societies and friendly societies in
the UK are MUTUAL ORGANISATIONS.
They are owned by their customers, or
members as they are known, rather than
shareholders. Profits go straight back to
members in the form o better and
cheaper products.
 

 Charities: Charities are organizations

with very specialized aims. They exist to
raise money for 'good' causes and draw
attention to the needs of disadvantaged
groups in society. Charities rely on
donations for their revenue. They also
organize fund raising events such as fetes,
jumble sales, sponsored activities and
raffles. A number of charities run
business ventures. Charities are generally
run according to business principles.
They aim to minimize costs, market
themselves and employ staff. Most staff
are volunteers, but some of the larger
charities employ professionals. In the
larger charities a lot of administration is
necessary to deal with huge quantities of
correspondence and to handle charity
funds. Provided charities are registered,
they are not required to pay tax. In
addition, businesses can offset any
charitable donations they make against
tax. This helps charities when raising
funds.
 

 Pressure groups: PRESSURE GROUPS

are groups of people that attempt to
influence decision makers in politics,
business and society. There is a wide
variety of pressure groups since they can
differ significantly in their aims,
objectives and size. Some groups are
quite large and operate as registered
charities. Some generate large amounts of
revenue through donations, fund-raising
activities and other sources. Some
pressure groups even represent
businesses.

Evaluate the importance and impact of the

legal structure for the various stakeholders for
a business
Business Explain the factors that need to be considered
location when locating a new business
Analyse these factors in relation to the needs
of the business
 Evaluate the choice of different locations for a
new business
Explain the sources of finance available to
entrepreneurs and SMEs
Business Analyse the advantages and disadvantages of
finance each source of finance
Evaluate different sources of finance available
to entrepreneurs and SMEs
Explain what is meant by costs, revenue and
profit
Identify costs to a business, including fixed,
variable, semi-variable, direct,
indirect/overhead costs and total costs
Calculate revenue, costs and profit
Interpret revenue, costs and profit calculations
Evaluate the impact of costs, revenue and
profit on a business and its stakeholders
Business Explain what is meant by contribution
revenue & Explain what is meant by break-even
costs Calculate contribution and understand its
application to the calculation of break-even
Construct and interpret break-even charts,
including the margin of safety
Illustrate on a break-even chart the effects of
changes in costs and revenue
Analyse how changes in costs and/or revenue
can affect break-even (‘what-if’ analysis)
Evaluate the usefulness of break-even to a
business and its stakeholders
COMPONENT 2
Content Amplicfication
Explain the purpose of marketing and its
importance to different types of business
Functions-
organisation in different situations
Marketing
Explain what is meant by market orientation,
product orientation and asset-led marketing
The Explain what is meant by the marketing mix
marketing
mix
Explain what is meant by product, product
portfolio, brand, unique selling point (USP)
and differentiation
Evaluate the importance of having the right
product(s) to a business and its stakeholders
Explain what is meant by the product life
cycle
Explain the stages in the product life cycle
Explain what is meant by an extension
strategy
Construct and interpret a product life cycle
diagram including extension strategies
Product Evaluate the impact of extension strategies on
a business
Explain the relationship between the product
life cycle and cash flow
Analyse product life cycles and extension
strategies for different businesses, products
and markets
Evaluate the use of the product life cycle to a
business and its stakeholders
Explain how the Boston matrix can be used to
manage a product portfolio
Evaluate the use of the Boston matrix to a
business and its stakeholders
Explain the different strategies used by
businesses to determine the appropriate price
for a product including penetration, skimming,
cost-plus, competitive, psychological and
contribution
Understand how different types of business
Price
organisations in different situations will use
different pricing strategies
Evaluate the importance for a business of
selecting the most appropriate pricing strategy
Evaluate the impact of pricing decisions on a
business and its stakeholders
Explain what is meant by promotion
Explain the different above the line and below
the line strategies used by businesses to
promote their products
Understand how different types of business
organisations in different situations will use a
Promotion range of different promotional strategies
Explain the importance for a business of
selecting the most appropriate promotional
strategy
Evaluate the impact of selecting the right
promotional strategy on a business and its
stakeholders
Place Explain what is meant by place
 Explain the different distribution channels
used by businesses
Explain what is meant by multi-channel
distribution
Explain the importance for a business of
selecting the most appropriate distribution
channel/s
Evaluate the impact of selecting the right
distribution channel/s on a business and its
stakeholders
Understand the importance of global
marketing and global brands
Explain how the marketing mix will differ in
Decisions
different contexts including, local, national or
about the
global markets, goods or services markets,
marketing
size of business, niche or mass markets and
mix
market structure
Evaluate the marketing mix in different
contexts
Explain how new technology is used in
marketing, including the role of digital media,
social media, e-tailing and m-commerce
Explain the impacts of new technology on
New
existing businesses such as high street
technology
retailers
Evaluate the impact of new technology on the
marketing activities of businesses and its
stakeholders
Content Amplification
Functions- Understand the role of the finance department
Finance
Explain what is meant by a budget
Budgeting Explain the purpose of budgets
Evaluate the use of budgets to a business and its stakeholders
Explain the sources of finance available to established and large businesses and consider their
appropriateness for different circumstances
Understand that sources of finance can be internal and/or external
Explain internal sources of finance including owner’s capital, retained profit and sale of assets
Business
Explain external sources/methods of finance including overdrafts, loans, share capital, venture
finance
capital, leasing, trade credit and debt factoring
Explain the advantages and disadvantages of different sources of finance to a business and the
importance of choosing appropriate sources
Evaluate the impact of different sources of finance to a business and its stakeholders
Explain what is meant by cash flow
Explain what is meant by a cash flow forecast
Construct, calculate and interpret cash flow forecasts
Evaluate the impact of a cash flow forecast on a business and its stakeholders
Cash-flow
Explain the causes of cash flow problems
Explain strategies by which a business can improve cash flow
Evaluate the strategies a business uses to improve cash flow problems
Explain the benefits and limitations of cash flow forecasts
Explain the main components of a trading, profit and loss account (the income statement) and the
The income way that it is constructed
statement Calculate gross profit and net profit
Evaluate ways in which a business could improve its profit
Ratio Calculate and interpret gross and net profit margins
Analysis Evaluate the calculations of profitability ratios to assess the performance of a business
Content Amplification
Functions – HR Explain the functions of the human resource department
Explain what is meant by the flexible workforce including flexible hours, home working, part
Changes in
time, temporary, job sharing, multi-skilling, zero hours contracts and hot-desking
working
Explain the impact of new technology on working practices
practice
Evaluate the impact of changes in working patterns on employees and employers
Explain what is meant by workforce planning
Workforce
Evaluate the impact and importance to a business of having the correct numbers of employees
planning
with appropriate skills and experience
Explain what is meant by the recruitment process
Explain what is meant by internal and external recruitment
Explain what is meant by job analysis, job description and person specification
Recruitment
Evaluate appropriate methods of selecting different types of employee for different types of job
including interviews, work trials, testing, selection exercises and telephone interviews
Evaluate the importance of recruitment to a business and its stakeholders
Explain what is meant by training
Explain the role of training in developing appropriate skills
Training Explain the different methods of training including induction, on-the-job, off-the-job and
apprenticeships
Evaluate the importance and impact of training for a business and its stakeholders
Explain what is meant by appraisal
Explain different methods of appraisal including superior’s assessment, peer assessment, self-
Appraisal assessment and 360 degree feedback
Understand how appraisal can benefit both the business and its employees
Evaluate the importance and impact of appraisal for a business and its stakeholders
Explain what is meant by workforce performance
Explain what is meant by labour productivity, absenteeism and labour turnover
Workforce
Calculate and interpret labour productivity and labour turnover
performance
Evaluate the importance and impact of workforce performance for a business and its
stakeholders
Explain what is meant by organisational design
Understand what is meant by authority, responsibility, chain of command, span of control,
delegation, hierarchy, centralisation and decentralisation, empowerment and delayering
Explain the characteristics of different organisational structures including hierarchical (flat and
Organisational
tall) and matrix structures
design
Explain the advantages and disadvantages of changing organisational structures and delayering
Evaluate the choice between empowerment and control of the workforce
Evaluate the appropriateness of different organisational structures to a business and its
stakeholders
Explain what is meant by motivation and the benefits of a motivated workforce
Explain motivation theories including Taylor, Mayo, Maslow, Herzberg and expectancy
theories
Evaluate the relevance of motivational theories and their importance to businesses
Explain financial methods of motivation including piece rate, commission, bonus, salary, profit
sharing, share ownership and performance related pay
Motivation
Explain non-financial methods of motivation including consultation,
job design, job enlargement, job rotation, job enrichment, empowerment, team working and
flexible working
Evaluate the appropriateness of various financial and non-financial methods of motivation for a
business and its stakeholders
Evaluate the impact of a motivated workforce on a business and its stakeholders
Content Amplification
Explain what is meant by management
Explain the functions and roles of management
Explain the advantages and disadvantages of management by objectives (MBO)
Explain McGregor’s theory X and theory Y
Evaluate the importance of management to a business and its stakeholders
Management Explain what is meant by leadership
& leadership Explain different types of leadership styles including autocratic, democratic, paternalistic,
bureaucratic and laissez-faire
Explain the leadership theories of Fiedler and Wright and Taylor
Evaluate the importance and impact of leadership for a business and its stakeholders
Evaluate the appropriateness of various leadership styles and theories to different business
situations
Explain what is meant by employer/employee relationships
Explain the duties and rights of employers and employees including contract of employment,
health and safety, minimum wage and dismissal
Explain what is meant by equal opportunities
Evaluate the impact of equal opportunities on employers and employees
Employer /
Explain the role of trade unions including collective bargaining, their advantages and
employee
disadvantages
relationships
Explain what is meant by employer and employee conflict including trade disputes and industrial
action
Explain the resolution of disputes including negotiation, consultation and the role of ACAS
Evaluate the impact of employer/employee relations, conflict and resolution on a business and its
stakeholders
Content Amplification
Functions – Understand the nature of operations management in different types of business organisation
Ops man
Explain what is meant by added value
Calculate added value
Added value
Explain ways of increasing value added
Evaluate the importance of added value to a business and its stakeholders
Explain the different methods of production including job, batch and flow
Production
Evaluate appropriate methods of production for businesses
Explain what is meant by productivity
Understand ways of measuring productivity
Explain ways in which productivity can be increased
Productivity Evaluate the importance and impact of productivity for a business and its stakeholders
Explain the concept of capacity utilisation
Calculate and interpret capacity utilisation
Evaluate the concept of capacity utilisation for a business and its stakeholders
Explain how new technology can be used by businesses, including the use of information
technology, CAD, CAM and robotics
Technology
Evaluate the impact of new technology on the various stakeholders of a business
Evaluate the importance and impact of technology in the operations of a business
Explain what is meant by lean production
Explain the range of lean production practices that are used to reduce waste and improve
Lean
productivity including kaizen (continuous improvement), just-in-time, cell production and time-
production
based management
Evaluate the importance and impact of lean production for businesses and their stakeholders
Explain what is meant by quality
Analyse the importance of quality to a business
Explain the difference between quality control and quality assurance
Quality Explain the concept of total quality management (TQM) and the ways that it can be achieved
including quality chains, empowerment, monitoring, teamwork, zero defects, quality circles and
benchmarking
Evaluate the importance of quality for a business and its stakeholders
Explain the importance of purchasing and working with suppliers
Explain what is meant by stock control
Understand the importance of controlling stock
Explain methods of stock control including traditional stock control methods, just-in-time and
Purchasing computerised stock control
Interpret stock control diagrams and explain the main components including re-order level, lead
time, buffer stock and minimum stock level
Evaluate the importance and impact on businesses and their stakeholders of holding too much or
too little stock
Explain what is meant by innovation, research and development
Research and
Explain the process of product design and development
development
Evaluate the costs and benefits of innovation, research and development for a business and its
(R&D)
stakeholders
Explain what is meant by economies of scale
Explain the different types of internal economies of scale
Explain how businesses benefit from the different types of internal and external economies of
Economies of scale
scale Explain reasons for internal diseconomies of scale
Explain the problems caused by internal diseconomies of scale
Explain the survival of small firms
Evaluate the impact of economies and diseconomies of scale on a business and its stakeholders