Higher Business Management

Higher Business Management Past Paper Questions
HIGHER
BUSINESS
MANAGEMENT
PAST
PAPER
QUESTION BOOKLET
BUSINESS IN CONTEMPORARY SOCIETY
Types of organisation
1
2
3
4
5
Explain advantages and disadvantages of becoming a public

limited company.
Explain 3 reasons why an organisation may move from being a
sole trader to a private limited company.
Many companies are now classed as multinationals. Explain the
advantages and disadvantages of operating as a multinational.
Describe the main characteristics of a multi-national corporation.
*Distinguish between a sole trader and a partnership.
5
3
5
4
3
Stakeholders
1
2
Describe the different interests 5 stakeholders may have in an

organisation.
*Explain the influences which stakeholders can have on an
organisation.
5
5
Objectives
1
2
3
4
Compare the objectives of a private sector organisation with those

of a public sector organisation.
Describe the possible objectives of a private limited company.
Explain internal factors which could be taken into account prior to
an organisation setting strategic objectives.
Explain the reasons why some organisations produce a mission
statement.
4
4
4
3
Role of enterprise
1
2
*Discuss the implications of becoming part of a franchise.

*Describe the role of an entrepreneur.
5
3
3
*Describe the advantages and disadvantages of being a franchisor
Sources of finance and assistance

1
Describe 4 different sources of long term finance available to a

private limited company.
Other than funds, describe the types of assistance a Local
Enterprise Company could provide for an organisation.
Describe and justify 3 sources of finance available to a
partnership. (A different justification should be used each time.)
Describe possible sources of finance for a plc looking to expand its
activities.
1
2
Describe possible methods of growth for a public limited company.

Explain how different methods of growth can lead to increased
sales or profits.
5
5
Explain the effects that 3 political factors could have on an

organisation. (A different effect should be explained each time.)
Describe 4 external factors (other than political) that could have
an impact on an organisation.
Identify and explain 3 economic factors that can affect the
profitability of a business.
Other than legislation explain the effect that external factors can
have on an organisation.
Explain the impact that recent trends in retailing have had on
organisations.
2
3
4
4
6
5
Growth
External factors
2
3
4
5
3
4
6
6
4
ICT
1
2
3
Sources and Types of information
Distinguish between the following:

(a) Primary information and secondary information
(b) Qualitative information and quantitative information.
Describe and justify the use of 4 types of information. (A different
justification should be used each time.)
Describe the benefits of different types of information.
Value of information
1
2
Describe the main characteristics of high quality information.

*Discuss the reliability and value of information found using the
Internet.
1
2
3
Discuss the effects of ICT on an organisation.

Explain the benefits to an organisation of introducing ICT.
Explain the benefits of using Information Communications
ICT in business
8
4
5
4
5
5
5
4
5
6
Technology for a multinational organisation.

ICT is used to help head office communicate effectively with
branches in remote areas of the country. Explain how modern
technology can be used to communicate effectively within an
organisation.
Distinguish between a wide area network and a local area
network.
Describe the main features of the Data Protection Act 1998.
2
5
DECISION MAKING
1
2
Decisions
Explain the role of a manager in effective decision making.

A manager decides to grant a workers request to have a weeks
holiday. Identify and justify this type of decision.
3
Distinguish between a tactical decision and an operational
decision.
4
Describe 3tactical decisions that could lead to growth.
5
Distinguish between a strategic decision and a tactical decision.
6
Justify why strategic decisions are made by senior managers.
7
Describe the 3 main types of decision that an organisation could
make.
8
Describe 2 types of decisions and give an example of each.
9
Explain internal constraints that make decision making difficult.
10 Explain internal problems that can exist when managers try to
make effective decisions.
11 Describe the factors that would result in a quality decision being
made.
1
2
3
4
5
Decision Making Model and SWOT
Explain the purpose of a SWOT analysis.

Discuss the advantages and disadvantages of using a structured
decision making model.
Explain the advantages to an organisation of using a structured
Explain the advantages and disadvantages of using a structured
Describe the uses of ICT in decision making.
5
2
3
3
3
3
3
4
4
5
4
4
7
5
5
6
INTERNAL ORGANISATIONS
1
2
3
4
5
1
2
3
4
5
6
Grouping of activities
Describe the advantages and disadvantages of functional

grouping.
Compare the use of functional grouping with product grouping.
Discuss the advantages and disadvantages of customer grouping.
*Discuss the advantages and disadvantages of place/territory
grouping.
* Discuss the advantages and disadvantages of technology
grouping.
Organisational structure
Describe the main characteristics of an entrepreneurial structure.

Organisations often use an entrepreneurial structure. Explain the
advantages and disadvantages of an entrepreneurial structure.
Distinguish between a centralised structure and a decentralised
structure.
Describe the main features of a matrix structure.
Distinguish between centralised and de-centralised decision
making.
*Explain why organisations have moved away from a tall structure
towards a flat structure.
Aspects of structure
Describe factors that influence the formal structure of an

organisation.
2
*Distinguish between a formal and informal structure.
3
Explain the benefits of outsourcing for an organisation.
4
Discuss the effects of outsourcing on an organisation.
5
Discuss the advantages and disadvantages of empowering staff
within an organisation.
6
Describe different types of organisational relationships that can
exist within a business.
7
Explain the effects of delayering on an organisation.
8
Describe the effects of increasing a managers span of control.
9
Describe factors an organisation should consider when trying to
encourage a positive corporate culture.
10 Describe different methods organisations can use to develop a
corporate culture.
11 Explain the advantages to an organisation of having a strong
corporate culture
5
5
4
4
4
3
4
3
3
5
4
3
2
4
5
6
4
4
5
5
4
4
HUMAN RESOURCES
HR Role
1
2
3
*Describe the role of the Human Resource department.

Compare the use of time rate with piece rate for paying
employees.
Describe other employee payment systems that could be used by
an organisation.
5
3
4
Patterns of employment
1
2
3
4
*Describe methods of flexible working practices which could be

introduced in a modern organisation.
Discuss the effects on an organisation of employing staff on
temporary contracts.
Describe 3 different employment contracts and justify their use. (A
different justification must be used each time.)
*Explain the implications for an organisation of offering flexible
working practices
6
6
6
Recruitment and selection

1
2
3
4
5
6
7
Discuss the use of external sources of recruitment.

Discuss the use of internal sources of recruitment.
Describe reasons for an organisation making use of an assessment
centre as part of the selection process.
Describe a selection process that an organisation could use to
ensure it employs the best workers.
Describe 5 stages of the recruitment process used by most
organisations.
Describe the benefits to an organisation of using interviews prior
to appointing a new employee.
Describe and justify 3 forms of testing (other than interviews)
used in the selection process. (A different justification should be
used each time.)
5
4
4
4
5
3
6
Training and appraisal

1
2
3
4
5
6
7
8
Describe the benefits to an organisation of staff training.

Explain the disadvantages of staff training for an organisation.
Describe the costs of staff training.
*Explain the consequences for an organisation which does not
offer staff training.
*Distinguish between on and off the job training
Describe appraisal and justify its use.
Describe the role of a manager in staff appraisal.
Appraisal has identified poor performance for a member of staff.
Describe the actions that a manager could take to improve the
employees performance.
5
4
4
3
2
4
5
4
Employee relations
1
Discuss methods that an organisation could use to ensure their

staff stay motivated.
2
3
4
5
6
Explain the impact of industrial action on an organisation.

Describe different forms of industrial action that an employee
could take.
Describe methods an organisation could use to encourage positive
employee relations.
Explain the effects that poor employee relations could have on an
organisation.
*Explain the role of ACAS
4
5
6
4
3
Legislation
1
2
3
Describe the main features of the Equality Act 2010

*Justify the use of legislation such as the Health and Safety at
Work Act
Explain how the following legislation could impact on an
organisation:
Freedom of Information Act 2002
National Minimum Wage Regulation 1999
Employment Rights Act 1996
3
2
6
FINANCE
Role of Finance
1
2
Explain the role of the Finance department in an organisation.

Describe the role of the finance department in meeting the
expectations of HMRC (Inland Revenue).
Describe financial information that potential shareholders could

use to decide whether or not to invest in a company.
Describe reasons why a competitor would make use of another
organisations final accounts.
Describe the final accounts that would be produced by an
organisation.
2
3
1
2
3
4
1
2
3
4
5
6
Financial Information
Budgets
Describe reasons for cash flow problems that can affect an

organisation.
Describe the purposes of sales and production targets.
Describe reasons why an organisation would use cash budgets
Describe the actions that could be taken to overcome cash flow
problems.
Ratio Analysis
Describe accounting ratios managers could use.

Explain the limitations of using accounting ratios.
Describe the actions an organisation could take to improve the
following ratios:
Net Profit Percentage
Current Ratio
Describe the limitations of ratio analysis when making financial
decisions.
Describe 3 accounting ratios and justify their use. (A different
justification must be used each time.)
Explain the reasons managers use accounting ratios.
4
2
6
2
3
5
3
5
5
6
5
6
5
6
4
MARKETING
1
1
2
3
Role of Marketing
Distinguish between product orientation and market orientation.
Market Research
Describe 4 methods of field research.

Discuss market research techniques used by an organisation.
Distinguish between:
quota sampling and random sampling
product led and market led organisations.
Describe and justify 3 market research techniques that an
organisation could use to assess customer satisfaction. (A different
justification should be used each time.)
Describe the reasons why organisations focus on research and
development.
Market Segmentation
Many organisations segment their market by gender eg male or

female.
Describe 6 other methods that an organisation could use to
segment their market.
Explain the advantages to an organisation of using market
segmentation
Marketing Mix
Describe the stages that a product might go through prior to being

launched onto the market.
2
Describe the 4 main stages of the product life cycle.
3
Describe the effect of each stage on profits.
4
Explain the effects that branding its products could have on an
organisation.
5
Discuss the advantages and disadvantages to organisations such
as Asda of selling own brand products.
6
Justify the use of loss leaders as a pricing tactic.
7
Describe 2 pricing tactics that an organisation could use when
selling an exclusive product.
8
Describe 3 pricing tactics that could be used when an organisation
attempts to break into a new market.
9
Describe methods a public relations department could use to
improve the image of an organisation.
10 Organisations use various forms of advertising media to bring their
products to the attention of consumers. Describe and justify
different forms of advertising media.
11 Describe 4 different sales promotions that could be carried out by
a retailer.
2
8
6
4
5
4
4
5
4
4
4
6
4
6
10
12 Describe the advantages and disadvantages of product

endorsement.
13 Describe 5 extension strategies that could be used to extend a
products life-cycle.
14 Explain how various methods of extending a products life cycle
can increase sales.
15 Describe the advantages and disadvantages of branding for an
organisation.
16 Explain the impact on a marketing department of introducing
modern technology.
17 Describe the advantages of e-commerce to an organisation.
18 Explain the purpose of the Advertising Standards Authority
6
5
6
6
5
5
2
11
OPERATIONS
1
1
2
3
4
5
1
2
3
4
5
1
2
3
4
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6
1
2
3
4
5
Role of operations
*Describe the main functions carried out by the Operations

Department
Methods of production
Explain the advantages and disadvantages of using job

production.
Describe the main features of batch production.
Compare batch production with flow production.
Explain the factors that would affect the choice of production
method used.
Distinguish between job production and flow production.
Quality
Discuss the importance of quality inputs in the operations process

of an organisation.
Describe quality management systems that can be used within an
organisation.
Discuss quality management techniques that an organisation
could use.
Discuss the use of quality standards for an organisation.
Describe the advantages and disadvantages of gaining approval
from the British Standards Institution (BSI).
Stock
Describe the use of ICT in a stock control system.

Discuss the use of just in time stock control.
Draw a diagram to illustrate how you would manage stock control
effectively (your diagram should be correctly labelled).
Describe the features of an effective stock control system.
Explain the problems that can arise from under and over
stocking.
Discuss the use of just in time production.
Channels of distribution
Explain the considerations an organisation would take into account

before choosing a supplier.
Describe and justify 4 methods of direct selling that could be used
by an organisation. (A different justification must be used to
support each description.)
Describe the factors an organisation would take into account
before choosing a channel of distribution.
Describe the reasons why some manufacturers sell their products
to retailers rather than directly to customers.
Explain the advantages and disadvantages of using a wholesaler.
5
3
3
5
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4
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3
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12
6
7
Discuss the advantages and disadvantages to a manufacturer of

using a wholesaler.
Describe the advantages and disadvantages of methods of
physical distribution that a producer could use to get their product
to consumers.
5
5
13

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Higher Business Management Past Paper Questions