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Section name
Unit 1: Business organization and environment
1.1 Introduction to business management
The role of businesses in combining human, physical and financial resources to create goods and services
The main business functions and their roles (human resources, finance and accounts, marketing, operations)
Primary, secondary, tertiary and quaternary sectors
The nature of business activity in each sector and the impact of sectoral change on business activity
The role of entrepreneurship (and entrepreneur) and intrapreneurship (and intrapreneur) in overall business activity
Reasons for starting up a business or an enterprise
Common steps in the process of starting up a business or an enterprise
Problems that a new business or enterprise may face
The elements of a business plan
1.2 Types of organizations
Distinction between the private and the public sectors
The main features of the following types of for-profit (commercial) organizations: sole traders, partnerships, companies/corporations
The main features of the following types of for-profit social enterprises: cooperatives, microfinance providers, public-private partnerships (PPP)
The main features of the following types of non-profit social enterprises: non-governmental organizations (NGOs), charities
1.3 Organizational objectives
Vision statement and mission statement
Aims, objectives, strategies and tactics, and their relationships
The need for organizations to change objectives and innovate in response to changes in internal and external environments
Ethical objectives and corporate social responsibility (CSR)
The reasons why organizations set ethical objectives and the impact of implementing them
The evolving role and nature of CSR
SWOT analysis of a given organization
Ansoff matrix for different growth strategies of a given organization
1.4 Stakeholders
The interests of internal stakeholders
The interests of external stakeholders
Possible areas of mutual benefit and conflict between stakeholders’ interests
1.5 External environment
STEEPLE analysis of a given organization
Consequences of a change in any of the STEEPLE factors for a business’s objectives and strategy
1.6 Growth and evolution
Economies and diseconomies of scale
The merits of small versus large organizations
The difference between internal and external growth
The following external growth methods: mergers and acquisitions (M&As) and takeovers, joint ventures, strategic alliances, franchising
The role and impact of globalization on the growth and evolution of businesses
Reasons for the growth of multinational companies (MNCs)
The impact of MNCs on the host countries
1.7 Organizational planning tools (HL only)
The following planning tools in a given situation: fishbone diagram, decision tree, force field analysis, Gantt chart
The value to an organization of these planning tools
Unit 2: Human resource management
2.1 Functions and evolution of human resource management
Human resource planning (workforce planning)
Labour turnover
Internal and external factors that influence human resource planning (such as demographic change, change in labour mobility, new communication technologies)
Common steps in the process of recruitment
The following types of training: on the job (including induction and mentoring), off the job, cognitive, behavioural
The following types of appraisal: formative, summative, 360-degree feedback, self-appraisal
Common steps in the processes of dismissal and redundancy
How work patterns, practices and preferences change and how they affect the employer and employees (such as teleworking, flexitime, migration for work)
Outsourcing, offshoring and reshoring as human resource strategies
How innovation, ethical considerations and cultural differences may influence human resource practices and strategies in an organization
2.2 Organizational structure
The following terminology to facilitate understanding of different types of organizational structures: delegation, span of control, levels of hierarchy, chain of command, bureaucracy, centralization, decentralization, de-layering
The following types of organization charts: flat/horizontal, tall/vertical, hierarchical, by product, by function, by region
Changes in organizational structures (such as project-based organization, Handy’s “Shamrock Organization”)
How cultural differences and innovation in communication technologies may impact on communication in an organization
2.3 Leadership and management
The key functions of management
Management versus leadership
The following leadership styles: autocratic, paternalistic, democratic, laissez-faire, situational
How ethical considerations and cultural differences may influence leadership and management styles in an organization
2.4 Motivation
The following motivation theories: Taylor, Maslow, Herzberg (motivation–hygiene theory), Adams (equity theory), Pink
The following types of financial rewards: salary, wages (time and piece rates), commission, profit-related pay, performance-related pay (PRP), employee share ownership schemes, fringe payments (perks)
The following types of non-financial rewards: job enrichment, job rotation, job enlargement, empowerment, purpose/the opportunity to make a difference, teamwork
How financial and non-financial rewards may affect job satisfaction, motivation and productivity in different cultures
2.5 Organizational (corporate) culture (HL only)
Organizational culture
Elements of organizational culture
Types of organizational culture
The reasons for, and consequences of, cultural clashes within organizations when they grow, merge and when leadership styles change
How individuals influence organizational culture and how organizational culture influences individuals
2.6 Industrial/employee relations (HL only)
The role and responsibility of employee and employer representatives
The following industrial/employee relations methods used by: employees: collective bargaining, slowdowns/goslows, work-to-rule, overtime bans and strike action, employers: collective bargaining, threats of redundancies, changes of contract, closure and lock-outs
Sources of conflict in the workplace
The following approaches to conflict resolution: conciliation and arbitration, employee participation and industrial democracy, no-strike agreement, single-union agreement
Reasons for resistance to change in the workplace (such as self-interest, low tolerance, misinformation and interpretation of circumstances)
Human resource strategies for reducing the impact of change and resistance to change (such as getting agreement/ownership, planning and timing the change and communicating the change)
How innovation, ethical considerations and cultural differences may influence employer–employee relations in an organization
Unit 3: Finance and accounts
3.1 Sources of finance
Role of finance for businesses: capital expenditure, revenue expenditure
The following internal sources of finance: personal funds (for sole traders), retained profit, sale of assets
The following external sources of finance: share capital, loan capital, overdrafts, trade credit, grants, subsidies, debt factoring, leasing, venture capital, business angels
Short, medium and long-term finance
The appropriateness, advantages and disadvantages of sources of finance for a given situation
3.2 Costs and revenues
The following types of cost, using examples: fixed, variable, semi-variable, direct, indirect/overhead
Total revenue and revenue streams, using examples
3.3 Break-even analysis
Total contribution versus contribution per unit
A break-even chart and the following aspects of break-even analysis: break-even quantity/point, profit or loss, margin of safety, target profit output, target profit, target price
The effects of changes in price or cost on the break-even quantity, profit and margin of safety, using graphical and quantitative methods
The benefits and limitations of breakeven analysis
3.4 Final accounts (some HL only)
The purpose of accounts to different stakeholders
The principles and ethics of accounting practice
Final accounts: profit and loss account, balance sheet
Different types of intangible assets
Depreciation using the following methods: straight line method, reducing/declining balance method
The strengths and weaknesses of each method
3.5 Profitability and liquidity ratio analysis
The following profitability and efficiency ratios: gross profit margin, net profit margin, ROCE
Possible strategies to improve these ratios
The following liquidity ratios: current, acid-test/quick
Possible strategies to improve these ratios
3.6 Efficiency ratio analysis (HL only)
The following further efficiency ratios: inventory/stock turnover, debtor days, creditor days, gearing ratio
Possible strategies to improve these ratios
3.7 Cash flow
The difference between profit and cash flow
The working capital cycle
Cash flow forecasts
The relationship between investment, profit and cash flow
The following strategies for dealing with cash flow problems: reducing cash outflow, improving cash inflows, looking for additional finance
3.8 Investment appraisal (some HL only)
Investment opportunities using payback period and average rate of return (ARR)
Investment opportunities using net present value (NPV)
3.9 Budgets (HL only)
The importance of budgets for organizations
The difference between cost and profit centres
The roles of cost and profit centres
The role of budgets and variances in strategic planning
Unit 4: Marketing
4.1 The role of marketing
Marketing and its relationship with other business functions
The differences between marketing of goods and marketing of services
Market orientation versus product orientation
The difference between commercial marketing and social marketing
Characteristics of the market in which an organization operates
Market share
The importance of market share and market leadership
The marketing objectives of for-profit organizations and non-profit organizations
How marketing strategies evolve as a response to changes in customer preferences
How innovation, ethical considerations and cultural differences may influence marketing practices and strategies in an organization
4.2 Marketing planning (including introduction to the four Ps)
The elements of a marketing plan
The role of marketing planning
The four Ps of the marketing mix
An appropriate marketing mix for a particular product or business
The effectiveness of a marketing mix in achieving marketing objectives
The difference between target markets and market segments
Possible target markets and market segments in a given situation
The difference between niche market and mass market
How organizations target and segment their market and create consumer profiles
A product position map/perception map
The importance of having a unique selling point/proposition (USP)
How organizations can differentiate themselves and their products from competitors
4.3 Sales forecasting (HL only)
Up to four-part moving average, sales trends and forecast (including seasonal, cyclical and random variation) using given data
The benefits and limitations of sales forecasting
4.4 Market research
Why and how organizations carry out market research
The following methods/techniques of primary market research: surveys, interviews, focus groups, observations
The following methods/techniques of secondary market research: market analyses, academic journals, government publications, media articles
Ethical considerations of market research
The difference between qualitative and quantitative research
The following methods of sampling: quota, random, stratified, cluster, snowballing, convenience
Results from data collection
4.5 The four Ps (product, price, promotion, place)
The product life cycle
The relationship between the product life cycle and the marketing mix
Extension strategies
The relationship between the product life cycle, investment, profit and cash flow
Boston Consulting Group (BCG) matrix on an organization’s products
The following aspects of branding: awareness, development, loyalty, value
The importance of branding
The importance of packaging
The appropriateness of the following pricing strategies: cost-plus (mark-up), penetration, skimming, psychological, loss leader, price discrimination, price leadership, predatory
The following aspects of promotion: above the line promotion, below the line promotion, promotional mix
The impact of changing technology on promotional strategies (such as viral marketing, social media marketing and social networking)
Guerrilla marketing and its effectiveness as a promotional method
The importance of place in the marketing mix
The effectiveness of different types of distribution channels
4.6 The extended marketing mix of seven Ps (HL only)
The importance of employee-customer relationships in marketing a service and cultural variation in these relationships
The importance of delivery processes in marketing mix a service and changes in these processes
Physical Evidence
The importance of tangible physical evidence in marketing a service
The seven Ps model in a service-based market
4.7 International marketing (HL only)
Methods of entry into international markets
The opportunities and threats posed by entry into international markets
The strategic and operational implications of international marketing
The role of cultural differences in international marketing
The implications of globalization on international marketing
4.8 E-commerce
Features of e-commerce
The effects of changing technology and e-commerce on the marketing mix
The difference between the following types of e-commerce: business to business (B2B), business to consumer (B2C), consumer to consumer (C2C)
The costs and benefits of e-commerce to firms and consumers
Unit 5: Operations management
5.1 The role of operations management
Operations management and its relationship with other business functions
Operations management in organizations producing goods and/or services
Operations management strategies and practices for ecological, social (human resource) and economic sustainability
5.2 Production methods
The following production methods: job/customized production, batch production, mass/flow/process production, cellular manufacturing
The most appropriate method of production for a given situation
5.3 Lean production and quality management (HL only)
The following features of lean production: less waste, greater efficiency
The following methods of lean production: continuous improvement (kaizen), just-in-time (JIT), Kanban, andon
Features of cradle to cradle design and manufacturing
Features of quality control and quality assurance
The following methods of managing quality: quality circle, benchmarking, total quality management (TQM)
The impact of lean production and TQM on an organization
The importance of national and international quality standards
5.4 Location
The reasons for a specific location of production
The following ways of reorganizing production, both nationally and internationally: outsourcing/zubcontracting, offshoring, insourcing
5.5 Production planning (HL only)
The supply chain process
The difference between JIT and just-in-case (JIC)
Stock control charts based on the following: lead time, buffer stock, re-order level, re-order quantity
Capacity utilization rate
Productivity rate
Cost to buy (CTB)
Cost to make (CTM)
5.6 Research and development (HL only)
The importance of research and development for a business
The importance of developing goods and services that address customers’ unmet needs (of which the customers may or may not be aware)
The following types of innovation: product, process, positioning, paradigm
The difference between adaptive creativity (adapting something that exists) and innovative creativity (creating something new)
How pace of change in an industry, organizational culture and ethical considerations may influence research and development practices and strategies in an organization
5.7 Crisis management and contingency planning (HL only)
The difference between crisis management and contingency planning
The following factors that affect effective crisis management: Transparency, Communication, Speed, Control
The following advantages and disadvantages of contingency planning for a given organization or situation: Cost, Time, Risks, Safety