Teaching Pack

AO3 Analysis
People in business

Cambridge IGCSE™
Business 0450
This Teaching Pack can also be used with the following syllabuses:
• Cambridge IGCSE™ (9–1) Business Studies 0986
• Cambridge O Level Business Studies 7115

Version 1
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Contents

Introduction ...................................................................................................................................................... 4
AO3: Analysis .................................................................................................................................................... 5
AO lesson: Applying business knowledge ....................................................................................................... 6
Skill development lesson: People in business ............................................................................................... 8
Independent lesson: Case study..................................................................................................................... 9
Worksheets and answers ............................................................................................................................. 10

Icons used in this pack:

Assessment Objective (AO) lesson

Skill development lesson

Independent lesson
Teaching Pack: AO3 Analysis

Introduction

This pack will help you to develop your learners’ higher order thinking skills as defined by AO3.

Important note
Our Teaching Packs have been written by classroom teachers to help you deliver
lessons which develop higher order thinking skills. Use these materials to
supplement your teaching and engage your learners. You can also use them to help
you create lesson plans for other parts of the syllabus.

This is one of a range of Teaching Packs. Each pack is based on one assessment objective which
is contextualised within one area of the syllabus. The packs can be used in any order to suit your
teaching sequence.

The structure is as follows:

Assessment Objective (AO) Lesson (1 hour*)

This lesson is designed to develop your learners’ understanding of the skill being
developed. This should help them to gain maximum benefit from the subsequent
lessons.

Skill development lesson(s) (1 hour*)

These lessons further introduce and extend the focus skill(s).
It also reminds learners of any content needed to contextualise these.

Independent lesson (1 hour*)

This lesson consolidates and builds on the progress learners have made.
In most cases, it will allow learners to work independently in a novel setting to use
the skills they have developed.
* the timings are a guide only; you may need to adapt the lessons to suit your circumstances.

In this pack you will find the lesson plans, worksheets for learners and teacher resource sheets you
will need to successfully complete the lessons.

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 Teaching Pack: AO3 Analysis

AO3: Analysis

This Teaching Pack focuses on AO3 Analysis – distinguish between evidence and opinion in a
given context. Order, analyse and interpret information in narrative, numerical and graphical forms
using appropriate techniques.

This Teaching Pack has links to the following syllabus content (see syllabus for detail):

• 2.1 Motivating employees

• 2.2 Organisation and management
• 2.3 Recruitment, selection and training of employees

The lessons cover the following skills, adapted from AO3: Analysis (see syllabus for
assessment objectives):

• Distinguish between evidence and opinion in a business context

• Interpret information in narrative, numerical and graphical forms using appropriate
techniques

Please note that analysis and evaluation will feature in some activities, but these skills are focused
on in more depth in other Teaching Packs and Scenario Packs.

Prior knowledge
Knowledge from the following syllabus topics is useful for the activities that follow:

• 2 People in business

Teacher notes
The suggested activities are to help engage your learners as they develop the skill of analysing
information from a range of business scenarios and contexts.

Learners can find distinguishing between evidence and opinion difficult. For example, the data on
staff productivity compared to how hard staff think they are working. Another example would be
how staff felt a recent training course improved their skills versus how their output had changed
according to data. Learners need to be able to take their business knowledge and use it to analyse
the context of different businesses and business scenarios.

Learners need to focus on how to use the business knowledge they have in given situations. The
Assessment Objective (AO) lesson, skill development lesson and the independent lesson activities
will help them practice this.

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Teaching Pack: AO3 Analysis

AO lesson: Applying business knowledge

Resources • Worksheet A, Worksheet B, Worksheet C and Worksheet D

Learning By the end of the lesson:

objectives • all learners should be able to draft an answer to a given question
using the skill of analysis
• most learners should be able to write a full answer to a given
question using analysis
• some learners will be able to write a full answer to a given
question, using analysis and without support materials

Timings Activity
Starter
Introduce learners to the requirements of AO3. The whole focus of this lesson will
be for them to understand what we mean by analysis. You may want to cover points
such as:
• In the exam, you are often provided with some information about the
business the question is focused on. For example, you might be told the
type of business, its future plans, how many employees there are etc.
• To ensure you are analysing the business information, you will need to
determine whether the information is an opinion or is evidence.
• You will also need to put the information in a rational order and be able to
interpret data from a written form, numerical or graphical form
• You will need to use the information given, when answering questions to
help demonstrate that you are analysing the business information.

All of the activities in this lesson should help learners to develop their skills of
analysis. Using Worksheet A, learners should complete the activity to match the
explanation to the way a business uses data.

Ask learners what they think can be done with data to make it useful for a business.

Main lesson
To help them to distinguish between evidence and opinion, learners should
complete the first activity on Worksheet B. This requires them to read the short
passages and identify which elements are opinion and which are evidence. You can
go through this with your learners using the answers for Worksheet B. There are
further exercises based on the analysis of data for learners to work through. This
can be peer or self-assessed using the answers.

Learners should use Worksheet C to analyse information from narrative forms using
the given text.

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AO lesson: continued

Timings Activity

Learners should use information from Worksheet B to help them draft an answer to
an exam style question on Worksheet D. They should be able to build an answer
using AO3 skills of distinguishing evidence from opinion, interpreting data and using
data to support their written response.

Plenary
Choose three or four learners to read out their answers and ask the class to
comment on how well they feel the information has been analysed.

Show the possible answer so learners can self or peer-assess their work. They
should then spend some time making any necessary corrections.

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Teaching Pack: AO3 Analysis

Skill development lesson: People in business

Resources • Worksheet E, Worksheet F and Worksheet G

Learning By the end of the lesson:

objectives • all learners should be able to explain the role of leaders and
managers, interpret organisational charts and explain the term
redundancy
• most learners should be able to analyse business information on
redundancies and interpret organisational charts
• some learners will be able to make recommendations in a given
scenario, using the exam skill of analysis to support their
recommendation

Timings Activity
Starter
Give learners Worksheet E and explain that this activity is to check and recap their
knowledge and understanding of elements of Section 2.1 of the syllabus. Your
learners should select the correct answer to each question. They could mark their
own answers or each other’s. They can use the quiz to identify areas that they need
to develop.

Main lesson
Hand out Worksheet F to help recap organisational charts. Learners should draw an
organisational chart from the information given. Take learners through the rest of
Worksheet F, allowing them time to complete the questions and check their
answers.

Using Worksheet G read through the Hardcastle Engineering Ltd case study
together then get learners to complete the questions. The answers are shown at the
end of this pack.

Plenary
To complete the lesson use the true / false questions shown below. Encourage
learners to vote in some way for their answer. There is no need for them to write
this down.
1. Distinguishing between evidence and opinion means judging whether a
statement is based on something that can be proven or not (true)
2. Opinions are statements using statistics or facts that can be proven (false)
3. A line graph is helpful to a business as it shows trends over time (true)
4. A bar chart allows a business to look at proportions (false)
5. A pie chart is often used to look at proportions of sales of different products
made by the same business (true)

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 Teaching Pack: AO3 Analysis

Independent lesson: Case study

Resources • Worksheet H, Worksheet I and Worksheet J

Learning By the end of the lesson:

objectives • all learners should be able to analyse some data from a case
study
• most learners should be able to analyse the data in order to
support a recommendation
• some learners will be able to analyse all of the data support a
complex recommendation

Timings Activity
Starter
Read the case study together on Worksheet H and make sure that your learners are
able to understand all of the data presented to them.

Main lesson
Once learners are happy with the information in the case study they should answer
the questions on Worksheet I. They can use the answers to peer or self-assess their
work.

Hand out Worksheet J to help learners to answer the following question:

Where do you think the CEO of Plastic Products plc should make
redundancies?

They will need to justify their answers and use the data to support their responses.

Plenary
Ask learners to feedback their answers on Worksheet J. Try to engage the whole
class by building up a final set of answers on the board by taking points from each of
them. You could use the suggested answers to help draw out content for the
responses.

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Teaching Pack: AO3 Analysis

Worksheets and answers

Worksheets Answers

For use in assessment objective lesson:

A: Analysis examples 11 – 12 33

B: Evidence and opinion 13 – 15 34 – 36

C: Analysing information 16 37

D: Building an answer 17 – 18 38

For use in skill development lesson:

E: Quiz 19 – 20 39 – 40

F: People in business 21 – 23 41 – 42

G: Hardcastle Engineering Ltd 23 – 24 44

For use in independent lesson:

H: Case study 25 – 28 –

I: Case study analysis 29 – 30 44

J: Making recommendations 31 – 32 45

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 Teaching Pack: AO3 Analysis

Worksheet A: Analysis examples

1. Look at the data on the markets of the two business shown below.

Over two thirds of households have shopped at Express in the last

Express
year.

Around two thirds of households have shopped at Timely over the last
Timely
year.

Express
Over 40% of households have shopped in both Express and Timely
Timely

Socio-economic grouping of customers

50

45

40
Percentage of customers

35

30

25 Express
20 Timely

15

10

0
Professional workers Skilled manual and Semi-skilled and unskilled
administrative workers workers

Age of customers
30

25
Percentage of customers

20

15
Express
Timely
10

0
<25 25-34 35-44 45-54 55+
Customer age ranges

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Teaching Pack: AO3 Analysis

Worksheet A: continued

What similarities and differences can you see between Express and Timely?

Similarities
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Differences
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2. Using the graph below, order the UK supermarkets by their market share.

Least market share Highest market share

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Worksheet B: Evidence and opinion

1. Identify what is opinion and what is evidence in the summaries below:

Major aircraft manufacturer to axe almost 500 jobs!

Unions say large scale redundancies at aircraft maker exceed their worst fears

Bosses at the French plant, whose head office is based in Canada, say that 486 jobs will go in the first
quarter of 2019. Due to recent tariffs from the USA, the business says it needs to reduce costs and
improve efficiency if it is to remain internationally competitive. Wings for the C model aircraft are made
at the French factory. Unions say it is a terrible blow for the morale of the French workforce and will
lower efficiency as workers fear for the future of the business.

Opinion

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

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Evidence
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………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

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Teaching Pack: AO3 Analysis

Worksheet B: continued

Struggling US supermarkets seeks refuge in merger

Consumer groups and unions say there will be a negative impact on consumer choice and jobs

Bosses of two of the biggest supermarket chains in the US, Fresh’n Tasty and Food4u, say that the
greater use of online grocery shopping has affected their profitability. They plan to merge to gain
market share and achieve economies of scale. “This merger is good news for consumers as the new
business can make significant cost savings” said Fresh’n Tasty Boss Mike Jones.

Consumer groups are concerned that there will be store closures once the businesses merge as many
of them are in close proximity. Union chief Diana Pounds states “Look at the example of Albuquerque
New Mexico, there is a Fresh’n Tasty half a mile away from a large Food4u. We believe after the
merger one of these stores will close, leading to redundancies.”

At present there are 579 Fresh’n Tasty stores across the western states of the USA while there are
129 Food4u stores, mostly in Southern California. Food4u CEO Janine Findler states “Statistics show
that the population in California is 38.79 million, with the largest city being Los Angeles at 4 million
people. It makes sense for us to concentrate on growing the business in this area.”

Opinion
………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

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Evidence

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………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

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Worksheet B: continued

2. Use the data in the table to order the information in the spaces below.

Supermarket Stores Market share Employees

Fresh’n Tasty 579 5.8 89,750

Food4u 129 2.9 23,000
Super Foods 900 17.5 182,000
Anderson’s 2,382 24.6 250,000
Savemart 4,500 33.5 546,750
Jo’s Club 768 8.6 175,000
Health Food Haven 494 4.7 91,000
Meierson’s 127 2.3 28,000

a. Order the supermarkets by market share

Lowest market share Highest market share

b. Order the supermarkets by the average number of staff per store

Lowest Highest

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Teaching Pack: AO3 Analysis

Worksheet C: Analysing information

US Retail worker statistics

Retail sales workers help customers find products they want and process customers’ payments. There
are two types of retail sales worker: retail salespersons, who sell retail merchandise, such as clothing,
furniture, and automobiles; and parts salespersons, who sell spare and replacement parts and
equipment, especially car parts. Most retail sales workers work in clean, well-lit stores. Many sales
workers work evenings and weekends. About one in three retail salespersons worked part time in
2016.

Typically, there are no formal education requirements for retail sales workers in the US. Most receive
on-the-job training, which usually lasts a few days to a few months. The median hourly wage for parts
salespersons was $14.13 in May 2017, which works out to $23,370 per year, whereas in May 2016 the
median wage was $10.80 and the yearly income was $22,680.

Overall employment of retail sales workers is projected to grow two percent from 2016 to 2026, slower
than the average for all occupations. Despite the low projected employment growth there should still
be plenty of job opportunities over the next ten years since many workers leave this occupation each
year.

1. What proportion of retail sales workers are part time?

………………………………………………………………………………………………………….

2. How much more per hour did a retail worker earn in 2017 compared to 2016? Show your
working.

………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….

3. What is the percentage change in retail workers’ annual income between 2017 and 2016?
Show your working.

………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….

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 Teaching Pack: AO3 Analysis

Worksheet D: Building an answer

Analyse the impact of the proposed merger between Fresh’n Tasty and Food4u on
employees and consumers.

Step 1 – Identify what the question is asking

………………………………………………………………………………………………………………..

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Step 2 – Show your analysis

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………………………………………………………………………………………………………………..

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Worksheet D: continued

Step 3 – The content of your answer

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Step 4 – Your answer to the question

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Worksheet E: Quiz

Select the correct answer for each question

1 Which one of these is the most accurate definition of the term motivation?

 how a business gets employees to work harder

 how a business gets employees who want a job
 how a business gets rid of employees it no longer needs
2 Which of the following is financial method of motivation?

 an award
 a good working environment
 a bonus
3 Using the organisational chart below, what is the span of control of the production manager?

Managing Director

Production
Finance Director
Manager

Five production Six distribution Three accounts

workers staff clerks

 three accounts clerks

 five production workers
 eleven workers and staff
4 What is the best definition of the term subordinate?

 the number of workers who report directly to a line manager

 the workers that a line manager is responsible for
 a worker under the control of others in an organisation
5 Which of the following is a function of management?

 commanding
 procuring
 selling

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Worksheet E: continued

6 Which answer best describes the role of management?

 to provide leadership of an organisation

 to formulate organisation wide aims and objectives
 to ensure the aims and objectives are met by functional areas of the business
7 Which of the following is often a key benefit of a flatter organisational structure?

 lower costs
 higher authority
 lower recruitment
8 Which type of leader is likely to make the following statement?
‘Decision making should be a joint venture between management, senior leaders and staff to
ensure that targets are realistic and all employees feel part of the process.’

 autocratic
 laissez-faire
 democratic
9 Which of the following would be a benefit of delayering?

 recruitment costs are lowered

 fixed costs are lowered
 marketing costs are lowered
10 Which of the following factors is most likely to result in redundancies?

 a competitor goes out of business

 takeover of a competitor
 increase in economic growth

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Worksheet F: People in business

An organisational chart is a diagram showing how the business is structured into levels of hierarchy.

Draw the organisational chart for a business which has the following employees:
• a Chief Executive Officer (CEO)
• a Marketing Manager who reports to the CEO and supervises the marketing workers
• a Production Manager who reports to the CEO and supervises the production workers
• three marketing workers who report to the Marketing Manager
• six sales people who report to the Marketing Manager
• ten production workers who are subordinates of the Production Manager

Organisational chart

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Teaching Pack: AO3 Analysis

Worksheet F: continued

What is a tall organisational structure?

………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….

What is the span of control of the three production supervisors?

………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
………………………………………………………………………………………………………….

What does the term delegation mean?

………………………………………………………………………………………………………….
………………………………………………………………………………………………………….
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What does the term redundant mean?

………………………………………………………………………………………………………….
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What does the term delayering mean?

………………………………………………………………………………………………………….
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………………………………………………………………………………………………………….

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Worksheet G: Hardcastle Engineering Ltd

Hardcastle Engineering Ltd makes precision engineering components for cars. The departments in the business are organised by function, for
example the purchasing department is responsible for buying in the materials needed to make the components whereas the sales department are
responsible for generating revenue.

The organisation of Hardcastle Engineering Ltd is a hierarchy with several layers. Employees in the higher layers have more authority than those in
the layers below as they have the power to make decisions and tell other workers what to do.

There is a chain of command with those at the top of the hierarchy being able to send instructions to those lower down in the hierarchy. The
managing director of Hardcastle Engineering Ltd has more authority than the production manager who is in a lower layer. The managing director
could send directions to the quality control manager through the production manager; this represents the line of communication.

Managing
Director

Human
Purchasing Finance
Sales Manager Resource
Manager Director
Manager

Production
3 Clerical Manager 3 Accounts
5 Sales People 6 HR Workers
Officers Clerks

Quality Control Stock Control Production Distribution

Manager Manager Supervisor Manager

10 Quality 2 Store 20 Production

3 Assistants
Inspectors Persons Workers

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Worksheet G: continued

Who is at the top of the hierarchy?

………………………………………………………………………………………………………….

Who is the line manager for the sales representatives?

………………………………………………………………………………………………………….

Who are the subordinates of the Finance Director?

………………………………………………………………………………………………………….

What is the span of control of the Production Manager?

………………………………………………………………………………………………………….

How many layers are there in the organisation?

………………………………………………………………………………………………………….

To whom would the Production Manager delegate responsibility for the stocks of raw materials?
………………………………………………………………………………………………………….

Who would be involved in the line of communication between the Managing Director and the Stock
Control Manager?
………………………………………………………………………………………………………….

The HR manager delegates responsibility for advertising jobs and dealing with application forms to
a subordinate. Which of the following statements are benefits that would result from delegating in
this way?

 The subordinate may work harder because they feel that they have been given a specific
area of responsibility
 The subordinate may feel that the Human Resource Manager is taking advantage of them
 The Human Resource Manager may feel that they are losing responsibility and may not get
as much pay
 The HR Manager may have more time to oversee the work of all the team members instead
of having to focus on detailed tasks
 The subordinate may improve their management skills and this could lead to a future
promotion
 The work will be done by a specialist and the quality should be good

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Worksheet H: Case study

Scenario

Plastic Products plc is a business that manufactures plastic bags and packaging materials for online and high street retailers. Due to increased
concerns over the environmental impact of plastic waste they have seen sales drop by 75% and have moved from being in profit in 2016 to making a
loss in 2017.

In order to make cost savings while they try to move to manufacturing packaging and bags made of more environmentally friendly materials,
Managing Director Carl Peterson has taken the tough decision to make some redundancies in the business. “At Plastic Products plc we believe that
we can streamline the organisation, rebrand ourselves as more environmentally friendly and return to profit in the short term by investing in alternative
packaging materials. We appreciate that there will be some concern amongst our employees as we seek to drive down costs through a rationalisation
programme, but would like to assure them that we will be working with them to find the best solution. Through creating a flatter organisational
structure, we believe will be motivating employees through greater delegation and responsibility.”

Plastic Products plc organisational chart

Managing
Director

Human
Operations Marketing Finance
Resources
Director Director Director
Director

Production Purchasing Marketing Sales Finance

HR Manager
Manager Manager Manager Manager Manager

5 Quality 5 Account
3 Purchasing 4 Marketing 10 Sales
Assurance 2 HR Staff
Clerks Workers People Clerks
Workers

15 Production
4 Accountants
Workers

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Worksheet H: continued

Report showing staffing information at Plastic Products plc

Job title Salary in $ Job role

Production Director 100,000 Planning the production and quality systems needed to ensure the business makes the right quantity of products at
the right time for the right cost to the business.
Production Manager 70,000 Ensuring the right quantity and quality of products are made on schedule.
Production Worker 18,000 Responsible for the day-to-day manufacture of packing and bags.
Quality Assurance Worker 20,000 Responsible for day-to-day quality assurance of production.
Purchasing Manager 60,000 Buying the equipment, goods and services needed by the business.
Purchasing Clerk 20,000 Carry out the day-to-day order processing to ensure the business has the correct equipment, goods and services
needed.
Marketing Director 100,000 Planning the overall strategy for promotional activities to communicate the message of brand to customers and
ensure sales targets are set and achieved.
Marketing Manager 55,000 Plan how to promote products and the brand and oversee all marketing activity.
Marketing Worker 25,000 Carry out the day-to-day marketing activities to promote the products and brand.
Sales Manager 70,000 Organise, coach and lead teams of sales people to work towards agreed sales targets.
Sales People 22,000 Sell products at the agreed level in order to generate revenue for the business.
Finance Manager 70,000 Organise and supervise the monitoring of income in an organisation as well as controlling the spending of the firm.
Accountant 35,000 Record the income and expenditure of the business on a day-to-day basis.
Account Clerks 23,000 Deal with the day-to-day transactions in a business.
Human Resource Director 70,000 Develop human resource plans such as recruitment, training and remuneration packages.
Human Resource 50,000 Deliver and manage human resource plans.
Manager
Human Resource Staff 30,000 Hire employees, develop their careers and look after employee relations, benefits and welfare.

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 Teaching Pack: AO3 Analysis

Worksheet H: continued

The graph below shows how much money is spent per role in the business and what this adds up to in departments where there is more than one
person with each job.

Staffing costs at Plastic Products plc

300000

250000

200000
Salary in $

150000

100000
Total salary spend

50000

Copyright © UCLES 2019 Cambridge IGCSE Business Studies (0450) 27

Teaching Pack: AO3 Analysis

Worksheet H: continued

The pie chart shows the percentage of each role as part of the whole salary spend by Plastic Products plc.

Human Resource Manager Human Resource staff

5% 3%

Human Resource Director

Production
7% Production Manager
Director
10% 7%
Account clerks
2%
Production worker
Accountants 2%
4%
Quality assurance worker
2%

Finance Manager Purchasing Manager

7% 6%

Purchasing clerk
Finance Director 2%
Marketing
13%
Director
10%

Sales
Manager
7%
Sales People Marketing Manager
2% Marketing worker 6%
3%

28 Cambridge IGCSE Business Studies (0450) Copyright © UCLES 2019

 Teaching Pack: AO3 Analysis

Worksheet I: Case study analysis

Using the information on Plastic Products plc on Worksheet H, complete the questions below.

Re-read the scenario containing information about Plastic Products plc.

1. Identify which parts are evidence and which are opinion.

Evidence:
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................

Opinion:
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................
……………………………………………………………………………………………...................

Using the organisational chart, answer the following questions.

2. Who is responsible for leading the team of Sales People?

……………………………………………………………………………………………...................

3. Work out what the span of the Production Manager is.

……………………………………………………………………………………………...................

4. Who is the subordinate of the Human Resources Director?

……………………………………………………………………………………………...................

5. How many levels are there in the hierarchy of Plastic Products plc?

……………………………………………………………………………………………...................

Copyright © UCLES 2019 Cambridge IGCSE Business Studies (0450) 29

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Worksheet I: continued

Look at the graph showing staffing costs at Plastic Products plc.

6. Where is Plastic Products plc spending the most money on staffing?

……………………………………………………………………………………………...................

7. Which manager earns the least?

……………………………………………………………………………………………...................

Look at the pie chart showing the percentage different roles contribute to the total salary spend by
Plastic Products plc.

8. What percentage of the total staffing costs do the sales people make up? Remember to
refer to the organisational chart too.

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

9. What percentage of the total staffing costs are made up of Directors salaries?

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

10. What percentage of the total staffing costs are made up of the Managers salaries?

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

……………………………………………………………………………………………...................

30 Cambridge IGCSE Business Studies (0450) Copyright © UCLES 2019

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Worksheet J: Making recommendations

Task
Using the case study information on Plastic Products plc, recommend where the CEO should make
staff redundant in order return the business to profitability.

Organising your ideas

The prompts below should help you to draw together key points from the materials that you can
use to justify your final recommendations.

1. How can you use the report made by the HR department on job roles to help you decide
where the redundancies should occur?

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

2. How can you use the organisational chart to help you make a recommendation?

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

3. How can you use the staffing costs bar chart to help you advise the CEO where redundancies
could be made?

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

4. How can the pie chart showing staffing costs be used to help you decide where to cut staffing
costs?

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

Copyright © UCLES 2019 Cambridge IGCSE Business Studies (0450) 31

Teaching Pack: AO3 Analysis

Worksheet J: continued

Your final recommendations

Use the space below to make your final recommendations to the CEO of Plastic Products plc about
where redundancies should be made. You need to fully justify your answer and use the data you
have been given to support your points.

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

……………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

……………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

……………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

……………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

……………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

………………………………………………………………………………………………………………..

……………………………………………………………………………………………………………………………
.

32 Cambridge IGCSE Business Studies (0450) Copyright © UCLES 2019

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Worksheet A: Answers

1. What similarities and differences can you see between Express and Timely?

Similarities
Customers from the same socioeconomic groups visit each store.

The majority of the people who visit both stores are from skilled manual and administrative

socioeconomic groups.

The age groups of households who visit each store is also similar with the 55+ category

being the most frequent visitors to both stores.

Differences
Fewer professionals from professional socioeconomic groups visit Timely.

Fewer young people under the age of 25 visit Timely.

2. Using the graph below, order the UK supermarkets by their market share.

Least market share Highest market share

Ocado Iceland Waitrose Lidl Aldi Morrisons Asda Sainsbury’s Tesco

1.2% 2.1% 5.1% 5.4% 7.3% 10.5% 15.5% 15.9% 27.6%

Copyright © UCLES 2019 Cambridge IGCSE Business Studies (0450) 33

Teaching Pack: AO3 Analysis

Worksheet B: Answers

1. Identify what is opinion and what is evidence in the summaries below:

Major aircraft manufacturer to axe almost 500 jobs!

Unions say large scale redundancies at aircraft maker exceed their worst fears

Bosses at the French plant, whose head office is based in Canada, say that 486 jobs will go in the first
quarter of 2019. Due to recent tariffs from the USA, the business says it needs to reduce costs and
improve efficiency if it is to remain internationally competitive. Wings for the C model aircraft are made
at the French factory. Unions say it is a terrible blow for the morale of the French workforce and will
lower efficiency as workers fear for the future of the business.

Opinion
Unions say large scale redundancies at aircraft maker exceed their worst fears.
The business says it needs to reduce costs and improve efficiency if it is to remain
internationally competitive.
Unions say it is a terrible blow for the morale of the French workforce and will lower
efficiency as workers fear for the future of the business.

Evidence
Bosses at the French plant, whose head office is based in Canada, say that 486 jobs will go
in the first quarter of 2019
Wings for the C model are made at the French factory.

34 Cambridge IGCSE Business Studies (0450)

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Worksheet B: Answers, continued

Struggling US supermarkets seeks refuge in merger

Consumer groups and unions say there will be a negative impact on consumer choice and jobs

Bosses of two of the biggest supermarket chains in the US, Fresh’n Tasty and Food4u, say that the
greater use of online grocery shopping has affected their profitability. They plan to merge to gain
market share and achieve economies of scale. “This merger is good news for consumers as the new
business can make significant cost savings” said Fresh’n Tasty Boss Mike Jones.

Consumer groups are concerned that there will be store closures once the businesses merge as many
of them are in close proximity. Union chief Diana Pounds states “Look at the example of Albuquerque
New Mexico, there is a Fresh’n Tasty half a mile away from a large Food4u. We believe after the
merger one of these stores will close, leading to redundancies.”

At present there are 579 Fresh’n Tasty stores across the western states of the USA while there are
129 Food4u stores, mostly in Southern California. Food4u CEO Janine Findler states “Statistics show
that the population in California is 38.79 million, with the largest city being Los Angeles at 4 million
people. It makes sense for us to concentrate on growing the business in this area.”

Opinion
Bosses of two of the biggest supermarket chains in the US, Fresh’n Tasty and Food4u, say
that the greater use of online grocery shopping has affected their profitability.
They plan to merge to gain market share and achieve economies of scale.
Consumer groups are concerned that there will be store closures once the businesses merge as
many of them are in close proximity.
“It makes sense for us to concentrate on growing the business in this area.”

Evidence
There is a Fresh’n Tasty half a mile away from a large Food4u.
At present there are 579 Fresh’n Tasty stores across the western states of the USA, while
there are 129 Food4u stores.
The population in California is 38.79 million, with the largest city being Los Angeles at 4
million people

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Worksheet B: Answers, continued

2. Use the data in the table to order the information in the spaces below.

Supermarket Stores Market share Employees

Fresh’n Tasty 579 5.8 89,750

Food4u 129 2.9 23,000
Super Foods 900 17.5 182,000
Anderson’s 2,382 24.6 250,000
Savemart 4,500 33.5 546,750
Jo’s Club 768 8.6 175,000
Health Food Haven 494 4.7 91,000
Meierson’s 127 2.3 28,000

c. Order the supermarkets by market share

Lowest Highest

Health
Fresh’n Joe’s
Meierson’s Food4u Food Superfoods Anderson’s Savemart
Tasty Club
Haven

d. Order the supermarkets by the average number of staff per store

Lowest Highest

Health
Fresh’n Joe’s
Anderson’s Savemart Food4u Food Superfoods Meierson’s
Tasty Club
105 122 178 Haven 202 220
155 228
184

36 Cambridge IGCSE Business Studies (0450)

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Worksheet C: Answers

US Retail worker statistics

Retail sales workers help customers find products they want and process customers’ payments. There
are two types of retail sales worker: retail salespersons, who sell retail merchandise, such as clothing,
furniture, and automobiles; and parts salespersons, who sell spare and replacement parts and
equipment, especially car parts. Most retail sales workers work in clean, well-lit stores. Many sales
workers work evenings and weekends. About one in three retail salespersons worked part time in
2016.

Typically, there are no formal education requirements for retail sales workers in the US. Most receive
on-the-job training, which usually lasts a few days to a few months. The median hourly wage for parts
salespersons was $14.13 in May 2017, which works out to $23,370 per year, whereas in May 2016 the
median wage was $10.80 and the yearly income was $22,680.

Overall employment of retail sales workers is projected to grow two percent from 2016 to 2026, slower
than the average for all occupations. Despite the low projected employment growth there should still
be plenty of job opportunities over the next ten years since many workers leave this occupation each
year.

1. What proportion of retail sales workers are part time?

One third

2. How much more per hour did a retail worker earn in 2017 compared to 2016? Show your
working.
$14.13 - $10.80
= $3.33 per hour more

3. What is the percentage change in retail workers annual income between 2017 and 2016?
Show your working.
$23,370 - $22,680 = 690
690 ÷ 22,680 x 100
= 3% increase

Cambridge IGCSE Business Studies (0450) 37

Teaching Pack: AO3 Analysis

Worksheet D: Answers

Analyse the impact of the proposed merger between Fresh’n Tasty and Food4u on
employees and consumers.

Step 1 – Identify what the question is asking

The question is asking the learner to use data to identify the issues affecting employees
resulting from the merger between the two organisations.

Step 2 – Show your analysis

In order to show analysis the learner must interpret and use data. Leaners should indicate

here which data they are going to use and how that is analysis. For example they may use

analysis of a narrative form, and pick out the section which states that consumer groups

are concerned that there will be fewer jobs in the future as there is likely to be store

closures as two stores in Albuquerque New Mexico are very close together.

Step 3 – The content of your answer

This area is for learners to plan their answer in note form.

Step 4 – Your answer to the question

This area should contain a detailed answer in continuous prose.

An example might be:

Staff will be impacted negatively because there will be duplication of the same job roles.
There will not be a need for two finance directors so one of the finance directors from
either Fresh’n Tasty or Food4u is likely to be made redundant. Evidence from the
supermarket article states that in Albuquerque New Mexico there are two stores within half
a mile of each other, which is very close. So it would make sense that if the newly merged
business wanted to make cost savings they would close one of the stores and make the staff
redundant. Looking at the staff-to-store relationship data it would make sense to close the
Food4u as they have 178 staff per store on average while Fresh’n Tasty have 155. This
means the new business could potentially save 178 x $23, 230 which is $4, 134, 940 per
year.

38 Cambridge IGCSE Business Studies (0450)

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Worksheet E: Answers

Select the correct answer for each question

1 Which one of these is the most accurate definition of the term motivation?

 how a business gets employees to work harder

2 Which of the following is financial method of motivation?

 a bonus
3 Using the organisational chart below, what is the span of control of the Production Manager?

Managing Director

Production
Finance Director
Manager

Five production Six distribution Three accounts

workers staff clerks

 eleven workers and staff

4 What is the best definition of the term subordinate?

 a worker under the control of others in an organisation

5 Which of the following is a function of management?

 commanding

Cambridge IGCSE Business Studies (0450) 39

Teaching Pack: AO3 Analysis

Worksheet E: Answers, continued

6 Which answer best describes the role of management?

 to ensure the aims and objectives are met by functional areas of the business
7 Which of the following is often a key benefit of a flatter organisational structure?

 lower costs – this is due to fewer managers who generally have higher salaries
8 Which type of leader is likely to make the following statement?
‘Decision making should be a joint venture between management, senior leaders and staff to
ensure that targets are realistic and all employees feel part of the process.’

 democratic
9 Which of the following would be a benefit of delayering?

 fixed costs are lowered – this is because managers have higher salaries and if a layer of
these are removed this save the business a lot of money.

10 Which of the following factors is most likely to result in redundancies?

 takeover of a competitor – this is likely to create duplication of job roles which makes some
staff from each company unnecessary.

40 Cambridge IGCSE Business Studies (0450)

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Worksheet F: Answers

An organisational chart is a diagram showing how the business is structured into levels of hierarchy.

Draw the organisational chart for a business which has the following employees:
• a Chief Executive Officer (CEO)
• a Marketing Manager who reports to the CEO and supervises the marketing workers
• a Production Manager who reports to the CEO and supervises the production workers
• three marketing workers who report to the Marketing Manager
• six sales people who report to the Marketing Manager
• ten production workers who are subordinates of the Production Manager

CEO

Marketing Production

Manager Manager

3 Marketing 10 Production
Workers Workers

6 Sales People

Cambridge IGCSE Business Studies (0450) 41

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Worksheet F: Answers, continued

What is a tall organisational structure?

An organisational chart showing the hierarchy where each level in the organisation has

more authority than the one below.

What is the span of control of the three production supervisors?

13 – 10 Production Workers and three Quality Assurance Workers.

What does the term delegation mean?

Delegation is the act of giving another person responsibility for a specific task, for

example the Operations Director may have given authority to the Production Managers

to organise the Quality Assurance Workers for how the quality of production is

monitored.

What does the term redundant mean?

Redundancy is when the position no longer exists so the worker’s employment is

terminated.

What does delayering mean?

Delayering is when layers of management are removed, usually from the middle of the

hierarchy as workers are still needed to carry out the day to day tasks of the business

42 Cambridge IGCSE Business Studies (0450)

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Worksheet G: Answers

Who is at the top of the hierarchy?

Managing Director

Who is the line manager for the sales representatives?

Sales Manager

Who are the subordinates of the finance director?

Three Accounts Clerks

What is the span of control of the Production Manager?

Four (Quality Control Manager, Stock Control Manager, Production Supervisor,

Distribution Manager)

How many layers are there in the organisation?

Five

To whom would the Production Manager delegate responsibility for the stocks of raw materials?
Stock Control Manager

Who would be involved in the line of communication between the Managing Director and the Stock
Control Manager?
Production Manager

The HR manager delegates responsibility for advertising jobs and dealing with application forms to
a subordinate. Which of the following statements are benefits that would result from delegating in
this way?

 The subordinate may work harder because they feel that they have been given a specific
area of responsibility
 The HR Manager may have more time to oversee the work of all the team members instead
of having to focus on detailed tasks
 The subordinate may improve their management skills and this could lead to a future
promotion
 The work will be done by a specialist and the quality should be good

Cambridge IGCSE Business Studies (0450) 43

Teaching Pack: AO3 Analysis

Worksheet I: Answers

1. Identify which parts are evidence and which are opinion.

Evidence:
They have seen sales drop by 75%
Have moved from being in profit in 2016 to making a loss in 2017.

Opinion:
Return to profit in the short term by investing in alternative
We will be motivating employees through greater delegation and responsibility

Using the organisational chart, answer the following questions.

2. Who is responsible for leading the team of Sales People?

Sales Manager

3. Work out what the span of the Production Manager is

20 (15 Production Workers, 5 Quality Assurance Workers)

4. Who is the subordinate of the Human Resources Director?

Human Resources Manager

5. How many levels are there in the hierarchy of Plastic Products plc?
Four

6. Where is Plastic Products plc spending the most money on staffing?

Production Workers

7. Which manager earns the least?

Human Resource Manager

8. What percentage of the total staffing costs do the sales people make up? Remember to
refer to the organisational chart too.
30% of total staffing goes to the Sales People

9. What percentage of the total staffing costs are made up of Directors’ salaries?
21%

10. What percentage of the total staffing costs are made up of the Managers’ salaries?
21%

44 Cambridge IGCSE Business Studies (0450)

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Worksheet J: Answers

1. How can you use the report made by the HR department on job roles to help you decide
where the redundancies should occur?

The report explains the job roles of each member of staff so can be used to see where there
is any duplication of role, for instance the Marketing director has responsibility for setting
sales targets and so does the Marketing manager.

2. How can you use the organisational chart to help you make a recommendation?

The organisational chart shows the layers in the hierarchy which can help us see where
there might be a layer that can be made redundant, for example the layer of managers or
the layer of directors.

3. How can you use the staffing costs bar chart to help you advise the CEO where redundancies
could be made?

The staffing costs bar chart helps us see that while the production staff are the highest
overall staffing cost to the business, they are also needed to make the bags and packaging
that generate revenue for the business so are needed. We can also see that there is a spike
for every director meaning that they are expensive relative to other staffing costs.

4. How can the pie chart showing staffing costs be used to help you decide where to cut staffing
costs?

The staffing costs pie chart helps us see that the directors make up 21% of the total
staffing costs and the managers also make up 21% of the total staffing costs. This allows us
to recommend that one of these layers in the hierarchy could be delayered.

Your final recommendations

Learners could recommend delayering the managers – this is the most likely scenario as they
have less authority than the directors and make up 21% of staffing costs.
Learners could also recommend delaying the directors, though this is less likely as the
directors are more senior in the hierarchy and would use their authority to protect their
positions. They also have more decision-making power than the managers, so it would benefit
the business to keep the experienced decision makers and delayer the managers who have less
decision making power.

Cambridge IGCSE Business Studies (0450) 45

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