Key term
WJEC A-Level Business 601-5238-2
Enterprise and Starting a Business
Markets and Market Research
Topic overviewTypes of marketMarket size, market share and market trendsMarket segmentationThe degree of competition in a marketPerfect competition and monopolistic competitionOligopoly and monopolyConsumer protectionDemand and the demand curveSupply and the supply curveMarket equilibrium and changes in price and quantityPrice and income elasticity of demandInferior, normal and luxury goodsThe value of market researchPrimary market researchSecondary market researchQualitative and quantitative dataSampling and avoiding bias
Marketing
Topic overviewMarket orientation, product orientation and asset-led marketingThe marketing mixProduct and the product portfolioBranding, USP and differentiationThe product life cycleExtension strategiesThe product life cycle and cash flowThe Boston matrixPricing strategiesChoosing the right pricing strategyPromotion: above the line and below the linePlace and distribution channelsThe marketing mix in different contexts and global marketingNew technology in marketing
People in Business
Topic overviewThe flexible workforceNew technology and changing working practicesWorkforce planningThe recruitment process, job analysis and job descriptionsInternal and external recruitmentMethods of selectionTrainingAppraisalLabour productivity, absenteeism and labour turnoverOrganisational design and structuresDelegation, empowerment and delayeringMotivation theoriesFinancial and non-financial methods of motivationManagement and management by objectivesLeadership styles and theoriesEmployment rights, duties and equal opportunitiesTrade unions, conflict and dispute resolution
Operations Management
Topic overviewAdded valueJob, batch and flow productionChoosing the right method of productionProductivityCapacity utilisationNew technology in operationsLean production and kaizenJust-in-time and cell productionQuality control and quality assuranceTotal quality managementStock control and stock control diagramsPurchasing and working with suppliersInnovation, research and developmentInternal economies of scaleExternal economies of scaleDiseconomies of scale and the survival of small firms
Business Finance and Accounts
Topic overviewInternal sources of financeLoans, overdrafts and trade creditShare capital and venture capitalLeasing and debt factoringChoosing an appropriate source of financeFinance for entrepreneurs and SMEs in WalesRevenue, costs and profitTypes of costContribution and break-evenBreak-even charts and the margin of safetyBudgets and budgetingCash flow forecastingImproving cash flowThe income statementGross and net profit margins
Business Analysis and Decision-Making
Topic overviewPrice and income elasticity of demandSales forecasting and its reliabilityMoving averages and time-series analysisCorrelation, scatter graphs and extrapolationPresenting and interpreting data: pie charts, histograms and index numbersQualitative forecasting techniquesBudgets and budget variancesThe balance sheetWorking capital, capital employed and depreciationLiquidity ratios: the current ratio and the acid testReturn on capital employed and gearingInterpreting and comparing company accountsNon-financial measures and vision statementsDecision treesCritical path analysisCost benefit analysis and scientific decision-makingPayback period and average rate of returnNet present value and discounted cash flowSpecial orders and contribution
Strategy and Implementation
Topic overviewAims and objectivesSMART objectivesMission and vision statementsCorporate, divisional and functional strategyStrategy, tactics and corporate plansSWOT analysisPorter's Five ForcesThe Ansoff matrixOrganic growthMergers and takeoversHorizontal and vertical integrationFranchising as a method of growthLocation and relocation decisionsRationalisation and outsourcing production
Managing Change and Risk
Topic overviewInternal and external causes of changePlanned and unplanned changeThe effects of change on a businessManaging change effectivelyStorey's four approaches to managing changeResistance to changeLewin's three step processOrganisational culture and leadership in changeEvaluating the management of changeThe risks a business facesRisk assessment and preventative actionInsurable and uninsurable risksContingency planning and crisis management
The External Environment
Operations Management
- 16 subtopics
- 45 things to know
- AS Unit 2
What Operations Management covers
Operations Management is examined in Unit 2, Business Functions, and again in Unit 4, which assesses the whole A level content. It covers added value, job, batch and flow production, choosing the right method of production, productivity, capacity utilisation, new technology in operations, lean production and kaizen, just-in-time and cell production, quality control and quality assurance, total quality management, stock control and stock control diagrams, purchasing and working with suppliers, innovation, research and development, internal economies of scale, external economies of scale and diseconomies of scale and the survival of small firms.
The 16 subtopics
Each one has its own page.
- Added valueAdded value, how branding adds value and how better purchasing adds value without changing the selling price.Open →
- Job, batch and flow productionJob production, batch production and downtime between batches.Open →
- Choosing the right method of productionHow the skill level of the workforce affects the choice and trade-off between unit cost and flexibility across the three methods.Open →
- ProductivityProduction and productivity, formula for labour productivity and formula for capital productivity.Open →
- Capacity utilisationRecall questions on how the measure is calculated, what running near or below full capacity does to unit costs, and the risks of operating at or above it for long.Open →
- New technology in operationsComputer aided design, computer aided manufacture and advantage of linking CAD to CAM.Open →
- Lean production and kaizenLean production, kaizen group or quality circle and time-based management.Open →
- Just-in-time and cell productionJust-in-time production, pull system of production and cell production.Open →
- Quality control and quality assuranceQuality in a business context, quality control and quality assurance.Open →
- Total quality managementTotal quality management, quality chain and concept of the internal customer.Open →
- Stock control and stock control diagramsStock control, three categories of stock a manufacturer holds and buffer stock.Open →
- Purchasing and working with suppliersPurchasing in a business, five factors a purchasing manager considers when choosing a supplier and how purchasing affects a business's profit margin.Open →
- Innovation, research and developmentResearch and development, invention and innovation and product innovation and process innovation.Open →
- Internal economies of scaleEconomies of scale, formula for average cost and minimum efficient scale.Open →
- External economies of scaleExternal economies of scale, industrial cluster and external diseconomies of scale.Open →
- Diseconomies of scale and the survival of small firmsDiseconomies of scale, shape of the average cost curve as output grows and why flexibility is a competitive advantage for a small firm.Open →
What you need to know
Answer each one before you reveal it.
Your recallNot started
Key term
Explain what a kanban system does.
Key term
What is cell production?
Key term
What is meant by added value?
Key term
What is job production?
Key term
Name four factors that determine which method of production a business chooses.
Key term
What is meant by productivity?
Key term
What is meant by capacity?
Key term
What is computer aided design?
Key term
What is meant by quality in a business context?
Key term
Explain the concept of the internal customer.
Key term
Give three costs of holding too much stock.
Key term
What is meant by purchasing in a business?
Key term
Distinguish between invention and innovation.
Key term
What is meant by economies of scale?
Key term
How does a local pool of skilled labour create an external economy?
Key term
Explain how coordination problems cause diseconomies of scale.
Numbers
State the formula for added value.
Key term
Give three examples of job production.
Key term
Why does the size of the market determine the method of production?
Key term
Distinguish between production and productivity.
Key term
What is meant by capacity utilisation?
Evaluation
Explain the advantage of linking CAD to CAM.
Key term
What is meant by lean production?
Key term
Give three reasons quality is important to a business.
Key term
Why is zero defects a target rather than a promise?
Key term
Give three consequences of holding too little stock.
Key term
Explain how purchasing affects a business's profit margin.
Process
Distinguish between product innovation and process innovation.
Numbers
State the formula for average cost.
Key term
How do local suppliers and component makers create an external economy?
Key term
Explain how a loss of motivation causes diseconomies of scale.
Numbers
A chair maker buys timber and fittings costing £18 per chair and sells each chair for £45. Calculate the added value per chair.
Evaluation
Give three advantages of job production.
Key term
Which method suits a product customers expect to be individual?
Numbers
State the formula for labour productivity.
Numbers
State the formula for capacity utilisation.
Key term
How are robots used in manufacturing?
Key term
What is kaizen?
Key term
How does just-in-time differ from a traditional just-in-case approach?
Key term
What is quality assurance?
Process
Name the main stages of a benchmarking exercise.
Key term
What is buffer stock?
Key term
Give two benefits of building a long-term relationship with a supplier.
Process
Name the main stages of product design and development.
Take Operations Management further
The same content, four other ways.
Commonly confused
Pairs that lose marks when they are blurred together.
Production vs Productivity
Production: the total quantity of goods or services a business makes in a period. Productivity: A measure of the output obtained from a given quantity of inputs, such as the amount made in an hour of labour.
Capacity vs Capacity utilisation
Capacity: the maximum output a business can achieve in a given period using the resources it currently has. Capacity utilisation: The proportion of its maximum possible output that a business is actually achieving, stated as a percentage.
Quality control vs Quality assurance
Quality control: the inspection of output during or at the end of production, in order to detect faulty items before they reach the customer. Quality assurance: Building standards into the process itself, making every employee answerable for their own work so that faults are prevented rather than found afterwards.
Questions from this topic
Each one with the model answer underneath.
- 1
What is meant by added value?
Model answer
Added value is the difference between the price a business charges for its output and the cost of the materials, components and services it bought in to produce it.
- 2
State the formula for added value.
Model answer
Added value = sales revenue − the cost of bought-in goods and services.
- 3
A chair maker buys timber and fittings costing £18 per chair and sells each chair for £45. Calculate the added value per chair.
Model answer
Added value is £45 − £18 = £27 per chair.
- 4
A chair maker buys timber and fittings costing £18 per chair and sells each chair for £45. Calculate the total added value if 2,000 chairs are sold.
Model answer
Added value is £45 − £18 = £27 per chair, so the total is £27 × 2,000 = £54,000.
- 5
Why are wages not deducted when calculating added value?
Model answer
Wages are one of the things added value has to pay for, along with rent, interest and profit, so deducting them would remove part of the value the business itself created.
- 6
Give four ways a business can increase the value it adds.
Model answer
It can improve design and quality, build a stronger brand, offer better service such as fast delivery or personalisation, and negotiate lower prices for its bought-in materials.
What is inside Levo
Six ways to work the same material.
Operations Management revision questions
- What does Operations Management cover in WJEC A-Level Business?
- 16 subtopics: added value, job, batch and flow production, choosing the right method of production, productivity, capacity utilisation, new technology in operations, lean production and kaizen, just-in-time and cell production, quality control and quality assurance, total quality management, stock control and stock control diagrams, purchasing and working with suppliers, innovation, research and development, internal economies of scale, external economies of scale and diseconomies of scale and the survival of small firms. Each one has its own page with questions and model answers.
- How is Operations Management organised?
- By the WJEC 601-5238-2 specification, subtopic by subtopic, so it matches the order you are taught it in.
Every question in Operations Management, on a schedule.
Attempt a question from memory, write the correct version, then attempt it again. Levo records the jump between your first attempt and your last, and brings each question back on the day you are due to forget it.
Or £46 a year, about £3.83 a month. Cancel anytime.