Now that almost all organisations have a web presence and the use of online transactions is rapidly growing, people in business need to understand how to contribute effectively to the design and content of websites. This unit aims to equip learners with sufficient understanding of the requirements of a business website to enable them to procure a website or work with technical specialists.
Unit introduction
Initially the unit will provide learners with an understanding of the different purposes of websites and the various models of use. It emphasises the need to base design on the clearly understood needs of the target group of users.
Research has shown that usability is of key importance in retaining users and encouraging repeated visits to a website. The unit therefore explores the different elements of usability in detail. The elements include navigation, language, efficiency, speed, privacy and visual appeal. Learners will also consider the importance of building trust in the minds of users and the methods for doing this. The requirements for accessibility under the Disability Discrimination Act are also considered.
The unit goes on to explore the main issues that have to be considered when developing or updating a website. The unit explores the importance of basing web design on two particular cornerstones: strategic and marketing objectives, and an understanding of the attributes and technical environment of users. The unit considers a range of functions commonly found on websites including the functions required to personalise users’ online experiences. Learners are taken through the range of decisions that need to be made relating to software, web hosting, page design, pre-launch evaluation and testing. Finally, planning for a range of important ongoing issues such as maintenance and updates, managing user or customer feedback, promotion of the website, security of ICT systems and planning for business continuity are considered.
Learning outcomes
On completion of this unit a learner should:
1 Know the purposes of a range of websites
2 Understand the main elements in web design for usability and visual appeal
3 Be able to plan the development of a website for an organisation.
Commercial relationships: business to business (b2b); business to consumer (b2c)
Purposes of commercial websites: direct sales models, transactions and delivery via online communication (eg software, music), transactions with separate delivery (eg tesco.com); pre-sales models, brochure ware, email campaigns; post-sales support models, automated customer support services, technical information; sites not directly related to sales transactions, corporate communications, public relations; sites providing information or services and drawing revenue from advertising eg social networking, browsers
Non-commercial business relationships: central and local government providing information and services to both businesses and consumers, voluntary sector organisations, campaigning groups
Purposes of non-commercial websites: provide information; influence public opinion; collect data; operational eg licence applications; tax return submissions.
Key marketing concepts: segmentation of market; identification of target group; design of marketing mix to meet needs of target group; place of website in marketing mix; place of website in promotion mix
Current and future developments: eg increased penetration of broadband in homes; increased use of mobile internet connections; telephony developments, scalability in planning a website
2 Understand the main elements in web design for usability and visual appeal
Usability: importance to success of website; retention of users through to completion; trust in site and customer loyalty; methods of building trust at first visit and subsequent visits; main factors affecting usability (navigation, language, efficiency, accuracy, speed of response, respect for privacy)
Navigation: based on consumer needs; ability to complete transaction
Language: tone and style suitable for target group; legible text
Efficiency: value for consumer; limited number of clicks; valued information or transaction in return for time
Accuracy: of all information given and processed
Speed of response: importance to consumer; limits for feeling of instantaneous reaction; continuity of flow of thought and for maintaining user attention; reasons for slow reaction times eg server throughput, server connection to the internet, internet bottlenecks, user’s connection to the internet, user’s browser and computer, web design features that slow down speed of response (eg multi-media effects, complex graphics)
Respect for privacy: no irrelevant or intrusive requests for information; privacy statement displayed
Design of web pages: user paths through site; ranking of information; amount of information on page; operation of search engines (page titles, tags, legibility, typography, design for usability and visual appeal); conflicts between different aspects of usability, eg personalisation versus speed, visual appeal versus speed, visual appeal versus legibility
Accessibility: requirement under the Disability Discrimination Act for ‘reasonable adjustments’ to be made to provide the disabled with a service that is generally available; requirements; means of checking conformance with accessibility guidelines
Visual appeal: use of colours, fonts and graphics; advantages and disadvantages of using multi-media; page transitions; unified style; consistency; use of white space; appeal to target group; consistency with brand image
3 Be able to plan the development of a website for an organisation
Strategy: business objectives; marketing objectives; consumer/customer profile and expectations; consumers’ technical environment and user experience; analysis of competitor websites
Functions of site: required functions eg search facilities, links to further information; registration of users; help facility; transaction arrangements; payment options eg use of credit cards, paypal; background functions eg databases
Personalisation of web experience: benefits to users; greater efficiency of user experience; benefits to organisation; tools eg cookies; databases.
Resources required: domain name; hosting own website; ISP hosting of website; options for connecting to the internet; software options (use of online ‘shop’ package or development of own software); use of web authoring tools (advantages and disadvantages); security measures; typical costs of developing small website
Evaluation: user acceptance testing; use in a range of technical environments eg browsers, different levels of connectivity; accessibility testing
Launch of website considerations: maintenance and updates; customer feedback; promotion of website; security of ICT systems; business continuity plans; typical costs of ongoing maintenance of a small website
In order to pass this unit, the evidence that the learner presents for assessment needs to demonstrate that they can meet all the learning outcomes for the unit. The assessment criteria for a pass grade describe the level of achievement required to pass this unit.
Assessment and grading criteria
To achieve a pass grade the evidence must show that the learner is able to:
To achieve a merit grade the evidence must show that, in addition to the pass criteria, the learner is able to:
To achieve a distinction grade the evidence must show that, in addition to the pass and merit criteria, the learner is able to:
P1 describe how three contrasting organisations use their websites for business purposes [IE]
M1 analyse how a selected website has been designed to meet the requirements of its target audience
D1 evaluate the extent to which the design of a selected website helps the originating organisation to meet its objectives [IE]
P2 explain the usability features of the websites of three contrasting organisations
P3 describe how the websites of three organisations have been designed to appeal visually to their users.
P4 design a website for a specified organisation to meet stated purposes for a defined target group [CT, SM]
M2 assess how own website design contributes to fulfilling the organisation’s purpose through meeting the requirements of the target audience [RL]
D2 make justified recommendations for how a website design and launch plan could be improved. [RL]
P5 draw up plans to assess the design of a website aimed at meeting a specified purpose [RL]
M3 explain the appropriateness of the plan for the launch of a website for a specified organisation.
P6 draw up a plan for the launch of a website for a specified organisation.[RL]
PLTS: This summary references where applicable, in the square brackets, the elements of the personal, learning and thinking skills which are embedded in the assessment of this unit. By achieving the criteria, learners will have demonstrated effective application of the referenced elements of the skills.
Learning outcome 1 draws on the learning from Unit 3: Introduction to Marketing and links the key marketing concepts to current developments in communications technology. Learners should have exposure to a range of websites, both commercial and not for profit and examine how different organisations are using the web in different ways. Visits to particularly innovative organisations, or to exhibitions featuring new developments could bring this part of the unit to life.
Learning outcome 2 focuses on the design of websites to meet the needs of users. The concept of ‘usability, and all its various elements should be explored in detail using examples of both good and bad practice. It would be interesting for learners to consider website design from the viewpoints of different types of users, including those with particular access requirements. Learners could investigate how a range of people from different backgrounds and ages respond to different websites perhaps through links with their own communities or through inviting visitors into the session for joint evaluation of websites.
Learning outcome 3 is a practical outcome and learners should design a website for a specific purpose and develop a plan to launch the website. Methodology should mirror that used by professional website developers, where possible. Whilst developing web pages is not specifically required in the grading criteria it would be beneficial for learners to have experience of using web authoring tools such as Dreamweaver, FrontPage or the functions in MS Office, for example converting a Word document into a web document, and to experiment with multi-media tools such as Flash. The realisation of part of their designs will enable them to further refine and evaluate them. Learners should explore the range of evaluation methods, including user acceptance testing and testing use in different technological environments such as older or different operating systems or situations with poorer connectivity.
Outline learning plan
The outline learning plan has been included in this unit as guidance and can be used in conjunction with the programme of suggested assignments.
The outline learning plan demonstrates one way in planning the delivery and assessment of this unit.
Topic and suggested assignments/activities and/assessment
Introduction to unit and programme of learning.
Small group work – learners examine a range of commercial business to consumer websites and collect information on purpose, objectives of organisation, target group, functionality, and present findings to rest of group. Tutor fills in gaps as required.
Whole group session – tutor helps learners to explore a website for a business to business relationship and leads a discussion on the requirements for b2b websites.
Pair work – learners are tasked with evaluating a selection of websites from the not for profit sector, and reporting back to the group.
Pair work – each pair identifies one predicted future development and explores uses. Learners create display of uses and whole group discuss which one is likely to be most significant.
Pair work – learners use various features from mobile phones suggesting business uses eg conferencing facilities, payment by phone, text message advertising.
Whole group teaching – tutor explains new developments followed by learner research.
Topic and suggested assignments/activities and/assessment
Assignment 1a: Website Design – Learners analyse websites of three contrasting organisations.
Individual work – learners work through structured worksheet on navigation issues, and how to arrange web pages for ease of navigation.
Whole group teaching – tutor leads exploration of the language used on various websites and it suitability for the intended audiences.
Pair work – investigation of efficiency and speed of response found in various websites – feedback to rest of group.
Whole group teaching – tutor explains the importance of accuracy and respect for privacy using case studies of imperfect practice.
Individual work – learners each investigate a website assuming a different type of special requirement, leading to a group discussion on accessibility requirements. Tutor explains how wider accessibility can be achieved.
Whole group teaching – tutor sums up design issues and brings in element of visual appeal using selected examples of websites.
Individual work – learners use worksheets to learn the fundamentals of producing a website.Assignment 1b: Website Design – Learners analyse the usability and visual appeal of selected websites.
Whole group teaching – tutor explains how websites are developed to support business and marketing objectives.
Pair work – learners analyse the business and marketing strategy and website functions of selected organisations.
Whole group work – tutor explains how individualisation of web experience is achieved.
Whole group session – visiting webmaster who explains how a specific website has been set up and maintained. Tutor explains other methods where applicable.
Pair work – learners undertake user acceptance testing for real launched website or proposed website leading to a group discussion on methodology.Assignment 2: My Own Website – Learners design a website and a plan to set up, launch and maintain website.
Supervised assignment time.
Non-supervised study time and completion of assignments.
Assessment
P1, P2 and P3 are based on an examination of the websites of three contrasting organisations. The organisations can be contrasting in terms of size, sector and purpose of their website and should include organisations from both the profit and not for profit sectors.
To achieve P1 learners should describe how the websites help the organisations to achieve their purposes and apply the marketing principles included in the unit content.
For P2, the learners need to explain how each website has employed ‘usability’ features as listed in the content.
To achieve P3 the learners should describe what has been done to appeal visually to the targeted audience.
In order for learners to achieve M1 they need to build on P1, P2 and P3 and analyse how one website has been designed to meet the requirements of its target audience.
For D1, this is developed into an evaluation of the contribution made by the website of one organisation to the organisation’s objectives. At this level learners should demonstrate higher level skills such as drawing on data from different sources and evaluating its reliability and relevance before coming to well argued conclusions.
For P4, learners are required to design a website for a specific organisation, for a specified purpose and defined target group. The design of the website should span several pages and include structured navigation, coherent style and information and functions suited to the needs of the customer and the organisation. Appropriate methods such as user profiling, site mapping, sketches and drawings should be used to produce a clear model of the intended design.
For P5, learners need to draw up plans for the evaluation of the website design. The plans should include consideration of all the methods listed in the content and selection of the most appropriate combination. If learners have produced their own websites then it would be useful for them to carry out the evaluations but this is not a requirement.
To achieve P6 learners need to produce a plan showing what actions they would take to launch a small website. The items listed under the unit content should be included in the plan. For the ongoing issues the learners’ work need only cover key decisions rather than detailed business continuity plans or fully-worked ICT security policies. P5 and P6 are developed into M3.
For M2, learners needs to develop a clear picture of the attributes of the target group, such as physical abilities, interests, colour and typography preferences, technical abilities and environment and an understanding of the organisational objectives. Consideration should be given to the availability of data on consumer groupings.
For D2, learners are required to make justified recommendations to improve the plans for the website and the launch plan. Alternatively, learners could evaluate and make recommendations for improvements of each other’s designs and launch plans. In this case learners should agree to abide by rules for giving constructive feedback.
Programme of suggested assignments
The table below shows a programme of suggested assignments that cover the pass, merit and distinction criteria in the grading grid. This is for guidance and it is recommended that centres either write their own assignments or adapt any Edexcel assignments to meet local needs and resources.
Criteria covered Assignment title Scenario Assessment method
P1, P2, P3, M1, D1 Website Design Learners are working for an organisation that gives awards for best websites in various categories and learners need to undertake research on different contenders for an award.
Each learner investigates a website from each of the following categories:
Commercial organisation selling over the web.
Government body communicating with public over the web.
Pressure group using website to support its purpose.
Each learner produces report on an example of each of the above categories.
P4, P5, P6, M2, D2, M3
My Own Website Learners have been commissioned to produce websites.
Each learner produces a website for an organisation for a specified purpose and targeted to a defined audience, and a plan for the launch and maintenance of the website.
Links to National Occupational Standards, other BTEC units, other BTEC qualifi cations and other relevant units and qualifi cations
This unit forms part of the BTEC Business sector suite. This unit has particular links with the following unit titles in the Business suite:
Level 2 Level 3
Business Online The Business Environment
Introduction to Marketing
Internet Marketing
The Impact of Communications Technology on Business
Supply Chain and Stock Management
Starting a Small Business
This unit can be delivered at the same time as the unit Internet Marketing and/or Starting a Small Business.
Essential resources
It is essential that the learners have plenty of access to suitable computers with good web access.
Employer engagement and vocational contexts
The unit will inevitably include examining a number of websites from the point of view of the owners and developers of the websites. The learning programme would been enriched if learners met with web developers or used real organisations’ current requirements for the brief for designing their own website and launch plan.
Indicative reading for learners
Textbooks
Clark D and Buckley P – The Rough Guide to the Internet (Rough Guides, 2005) ISBN 1843535505
Levine J, Young M and Baroudi C – The Internet for Dummies (Hungry Minds Inc, US, 2005) ISBN 0764589962
MacDonald M – Creating Websites: The Missing Manual (O’Reilly, 2005) ISBN 0596008422
The following publications may be useful as tutor resources:
Donoghue K – Built for Use: Driving Profitability Through the User Experience (Osborne McGraw-Hill, 2002) ISBN 0071383042
Neilsen J – Designing Web Usability: The Practice of Simplicity (New Riders, 2000) ISBN 156205810X
Delivery of personal, learning and thinking skills
The table below identifies the opportunities for personal, learning and thinking skills (PLTS) that have been included within the pass assessment criteria of this unit.
Skill When learners are …
Independent enquirers evaluating the extent to which the design of a selected website helps the originating organisation to meet its objectives
Creative thinkers designing a website for a specified organisation to meet stated purposes for a defined target group
Reflective learners making justified recommendations for how own website could be improvedSelf-managers designing a website for a specified organisation to meet stated purposes for a
defined target group.
Although PLTS are identified within this unit as an inherent part of the assessment criteria, there are further opportunities to develop a range of PLTS through various approaches to teaching and learning.
Skill When learners are …
Independent enquirers exploring issues, events or problems from different perspectives arising from website research
Creative thinkers trying out alternative methodologies and approaches to work and following the ideas through
Reflective learners assessing themselves and others in group work discussions on planning to identify opportunities and achievements
Team workers collaborating with others when working on project based case studies in groups
provide constructive support and feedback to others on oral presentations on project plans
Self-managers organising time and resources, prioritising actions when developing their skills in website design
Effective participators taking part in group activities, working with others.
The aim of this unit is to enable learners to understand the skills needed to set up and run a business, and the regulations that need to be complied with, and to have the opportunity to prepare a detailed business plan.
Unit introduction
Starting a small business is an ambition for many people. The business idea could be almost anything such as a coffee shop, a courier service, a hairdresser, a motor vehicle repair workshop, a DJ service, a painting and decorating business, an equipment hire operation, or an organic smallholding producing fruit and vegetables. However, starting a small business can be fraught with difficulties and the idea may not always be successfully realised. Those setting out on this venture need to consider the business idea, where funding will come from, the potential market, the competition and a host of other issues that must be addressed if the business start- up is to be successful.
This unit gives learners the opportunity to consider their business idea within structured business parameters, such as the type of business, the attractiveness of the business idea, the target market and the need to balance personal and business needs. Learners will also consider their ability to run the business, including the skills they already have to support the business idea and what personal development they may have to undertake in order for the venture to be successful.
Learners will also develop their knowledge and understanding of the legal status and trading terms and conditions of their proposed business, legal aspects such as fire regulations, taxation, VAT and HM Revenue and Customs, and financial aspects such as start-up and operational costs, as well as personal needs.
Learners will have the opportunity to devise an outline proposal for a business start up. This will cover the reasons for preparing a business proposal and will include the components expected by financial advisers, including the type of business, its target market, available resources, financial information and forward planning.
Learning outcomes
On completion of this unit a learner should:
1 Be able to present the initial business idea using relevant criteria
2 Understand the skills and personal development needed to run the business successfully
3 Know the legal and financial aspects that will affect the start up of the business
4 Be able to produce an outline business start-up proposal.
1 Be able to present the initial business idea using relevant criteria
Criteria: type eg new, purchase an existing business, franchise; aims; business planning; attractiveness of idea eg unique selling point, demand for new business, competitive edge; balancing personal/business needs; checking profitability; business trends; external influences eg commercial, political, local, national, international; self-esteem eg work for self, independence, power, achievement
Identifying target market: eg market research, published research, sales forecasts, customers’ actions and choices, effect on business, competition, strengths and weaknesses, market trends; environmental issues
2 Understand the skills and personal development needed to run the business successfully
Skills: own contribution; technical/operational – relating to products/services, management, recording and checking performance of business, personal selling, administration, previous experience, strengths and weaknesses
3 Know the legal and financial aspects that will affect the start up of the business
Legal aspects: legal status eg sole trader, partnership, limited company, co-operative; legal liabilities; trading terms and conditions; trading standards; licences; record keeping; resolving problems; national/local laws; regulations and bylaws; health and safety; fire regulations; licensing; liabilities; planning permission, contracts, duties and responsibilities; regulatory bodies; sources of advice
Financial aspects: personal survival budget; cost of premises, equipment and supplies; running costs; employing staff; pricing policy; break even; cash flow forecasting; profit and loss budgets/accounts; sources of finance eg grants, loans, borrowing, sponsorship; record keeping
4 Be able to produce an outline business start-up proposal
Business proposal: models; reviewing information and ideas; setting targets and goals; purpose of plan; components (type of business, market, human/physical/financial resources, financial and profit forecasts, growth and development, contingencies)
In order to pass this unit, the evidence that the learner presents for assessment needs to demonstrate that they can meet all the learning outcomes for the unit. The assessment criteria for a pass grade describe the level of achievement required to pass this unit.
Assessment and grading criteria
To achieve a pass grade the evidence must show that the learner is able to:
To achieve a merit grade the evidence must show that, in addition to the pass criteria, the learner is able to:
To achieve a distinction grade the evidence must show that, in addition to the pass and merit criteria, the learner is able to:
P1 present the initial business idea using relevant criteria
M1 explain methods used to identify the target market for the proposed business
D1 present a comprehensive business proposal that addresses all relevant aspects of business start up.
P2 explain how to identify the target market
P3 describe the skills needed to run the business successfully and what areas require further personal development[TW, EP]
M2 analyse the personal development needed to run the business successfully
P4 describe the legal and financial aspects that will affect the start-up of the business
P5 produce a proposal containing the essential information for the start up of a business.[TW, EP]
M3 assess the implications of the legal and financial aspects that will affect the start up of the business.
PLTS: This summary references where applicable, in the square brackets, the elements of the personal, learning and thinking skills which are embedded in the assessment of this unit. By achieving the criteria, learners will have demonstrated effective application of the referenced elements of the skills.
This unit enables learners to investigate and identify the skills needed to run a successful small business. The term ‘small business’ is related to people operating on their own as sole traders or partnerships and limited companies employing 10 or fewer staff. To begin developing thoughts and ideas, a discussion group could brainstorm a wide range of small business opportunities, such as a coffee shop, a courier service, a hairdressing business, a motor vehicle repair workshop, a DJ service, a painting and decorating business, an equipment hire operation, or an organic smallholding producing fruit and vegetables. Learners should be encouraged at this early stage to begin to focus on a possible small business idea. They should not be deterred if their ideas change during this unit. They need to concentrate on the processes involved rather that the specific outcomes.
Learners will need some theoretical input to develop their understanding of the criteria for developing a business idea. Tutors should use case study materials to illustrate a range of examples and help learners to focus their thoughts during the formulation of their ideas, including how the business idea will relate to its target market.
Learners need to carry out a skills audit to examine the skills they currently have to support the new business operation. They also need to consider what personal development they might need. This could usefully be supported by investigating similar businesses and talking to their owners/managers to see what skills are needed and how these match the learner’s current and proposed development. These investigations could also inform learner knowledge of market research, although small businesses should be properly advised about learner activities and be briefed about how their contribution will support the unit.
Learners should consider exploring a number of legal aspects:
national/local laws
regulations and bylaws
health and safety
fire regulations
licensing
liabilities eg tax and VAT, insurances
planning permission, contracts, duties and responsibilities
regulatory bodies for example Environmental Health Office, HM Revenue and Customs
sources of advice for example Business Link centres, solicitors and the Small Business Service.
When considering legal and financial aspects of small business start-ups, learners would benefit from guest speakers such as those operating a small business, business start-up advisors, accountants, and representatives from banks, the HM Revenue and Customs, training and advice services and local enterprise agencies. Visits to local small businesses or presentations by representatives from local trade associations, such as the Chamber of Commerce, would help learners to develop an awareness of what is needed to run a small business.
Delivery of the unit must ensure that learners understand the full implications of setting up a small business. It will be important for learners to know what skills they have and would need, their survival needs and how much money, and other resources, will be required to start up the business. Learners should develop a clear outline for a business start-up proposal as a result of completing the unit. Learners can select from a wide range of supporting materials available in a variety of formats, for example the internet or small business
start-up packs available from banks and building societies. However, it is important they understand that this is only an outline and not a fully-fledged business plan.
Outline learning plan
The outline learning plan has been included in this unit as guidance and can be used in conjunction with the programme of suggested assignments.
The outline learning plan demonstrates one way in planning the delivery and assessment of this unit.
Topic and suggested assignments/activities and/assessment
Induction and outline scheme of work/programme of assignments
Formal theory input on initial business ideas
Research and group workAssignment 1: Business Idea and Target Market
Input on skills and development
Research and group work
Input on legal and financial aspects for start up
Research and group workAssignment 2: Required Skills
Input on business plans
Research and group workAssignment 3: Business Plan
Supervised assignment time
Non-supervised study time and completion of assignments
Assessment
Learners will be expected to produce evidence that shows their knowledge and understanding of how small businesses are started. It may include:
an explanation of the initial idea for developing a small business
findings from their analysis of the skills and personal development needed to run the business
an explanation of the legal and financial aspects that will affect the start up of their business
an outline proposal for starting up a new small business.
Evidence for this unit should primarily be formal due to the nature of the unit. Initial ideas can be evidenced either through an oral or written presentation, or through a short report. Other evidence such as records of discussions and notes of meetings would provide useful support.
To meet P1, learners must present the initial business idea using relevant criteria. These criteria should be clear from the business idea, for example the type of business, what its unique selling points may be, any external influences (eg location) and so on. Learners should discuss the development of their evidence with their tutor and, where possible, a business mentor. This presentation can be in the form of a formal report or a presentation to a group. Where this is the case, tutors should ensure that any business mentors used are present. For P2, the presentation should include an explanation of how to identify the target market, which will be informed by the business idea and the criteria used to define it.
For P3, learners must be realistic about their skills and personal development analysis. Although the small business idea may not come to fruition, intentions should be realistic and evidence should highlight learners’ awareness of their skills and development opportunities. Learners are not expected to undertake additional development work but need to be aware of what the requirements would be.
For P4, learners must produce a proposal which describes the legal and financial aspects that will affect the start up of the business. They may need to consult with specialists (this should be guided by the delivery of the unit) and should address aspects such as the legal status of the business, the form of trading it will undertake, together with specific relevant legal and financial issues. Learners should presume that their ideas can become reality and should consider these areas accordingly.
For P5, the outline business plan should follow a formal report format and can be developed into a comprehensive document. This should reflect legal aspects relating to the start up of a new business, but monetary aspects will need to involve some simulation. The report should be supported by an oral discussion, which may be undertaken with a specialist such as a bank manager.
For M1, learners need to demonstrate their understanding of the methods used to identify the target market for the proposed business. This will require them to consider a range of methods that could actually be used and to provide reasons for their choice. Market research will almost certainly be included but learners need to explain why. Other methods may prove more challenging but the selection and justification should contribute to a possible business launch, rather than just being a descriptive account of how they could be applied.
For M2, if learners were to launch a business, they would certainly need to undertake further personal development. P3 has already addressed what areas require further development. At merit level, learners need to analyse these areas of development and explain how they would pursue each in order to strengthen their ability to start a business. Examples could include sources of training with appropriate timelines that fit with the business launch dates.
For M3, learners also need to consider the impact of legal and financial aspects. This may require them to describe systems they will have in place for addressing such issues, such as recording systems for tax and VAT liabilities. Learners may wish to include a summary of how these will be embedded within the overall business plan.
To meet D1, learners need to draw all their evidence together into a comprehensive business proposal that addresses all relevant aspects of business start up. Other pass and merit criteria will already have covered much of the evidence they will need. For distinction level, they need to present all the evidence in a fluent proposal. Learners should be encouraged to seek guidance on the preparation of their proposal, much as they would do in the real world. They should discuss a draft with their tutor and/or business mentor, making improvements and revisions, before presenting the final version.
Programme of suggested assignments
The table below shows a programme of suggested assignments that cover the pass, merit and distinction criteria in the grading grid. This is for guidance and it is recommended that centres either write their own assignments or adapt Edexcel assignments to meet local needs and resources.
Criteria covered Assignment title Scenario Assessment method
P1, P2, M1 Business Idea and Target Market
Setting up a Business. Group Practical Work.
P3, P4, M2 Required Skills Setting up a Business. Group Practical Work.
P5, M3, D1 Business Plan Setting up a Business. Group Practical Work.
Links to National Occupational Standards, other BTEC units, other BTEC qualifi cations and other relevant units and qualifi cations
This unit forms part of the BTEC Business suite. This unit has particular links with the following unit titles in the Business suite:
Level 2 Level 3
Business Purposes The Business Environment
Business Organisations
Financial Forecasting
Business Online
Essential resources
Many of the learning outcomes for this unit require learners to undertake research. To enable research skills to be developed effectively, they should be introduced to as many different forms of information as possible, eg libraries and other research facilities including the internet, national newspapers, local banks, start-up business training agencies.
Learners will also benefit from case study materials, which may focus on specific aspects of developing small business ideas.
Most clearing banks offer small business packs which could be useful teaching and learning resources. Additionally, Business Links and Chambers of Commerce can provide additional information to complement learning activities.
Learners can find information using company annual reports, journals, magazines, company websites and newspapers.
Learners will need access to a range of information resources to complete investigative assignments and case studies will be essential, including relevant CD ROMs and the internet.
Employer engagement and vocational contexts
Visits to companies and from employees are useful to the delivery of this unit. The use of vocational contexts is essential in the delivery and assessment of this unit.
Work Experience/Workplace learning frameworks – Centre for Education and Industry (CEI, University of Warwick) – www.warwick.ac.uk/wie/cei/
Learning and Skills Network – www.vocationallearning.org.uk
National Education and Business Partnership Network – www.nebpn.org
Delivery of personal, learning and thinking skills
The table below identifies the opportunities for personal, learning and thinking skills (PLTS) that have been included within the pass assessment criteria of this unit.
Skill When learners are …
Team workers working together in teams Effective participators planning, negotiating and communicating with integrity.
Although PLTS are identified within this unit as an inherent part of the assessment criteria, there are further opportunities to develop a range of PLTS through various approaches to teaching and learning.
Skill When learners are …
Independent enquirers planning and carrying out research into businesses Reflective learners reviewing and reflecting on their coursework and acting on the outcomes to
modify and improve their work
inviting feedback on their own work and dealing positively with praise, setbacks and criticism
evaluating their experiences and learning to inform future progressTeam workers collaborating with others to research information about business organisations
managing discussions to reach agreements and achieve resultsSelf-managers organising time and resources and prioritising actions when producing coursework,
whether on their own or in a group
deal with competing pressures, including personal and work-related demands
responding positively to change, seeking advice and support when neededEffective participators planning, negotiating and communicating with integrity.
The aim of this unit is to introduce learners to the concept of business ethics and to examine its application to the conduct of individuals in organisations and to the conduct of the organisation as a whole.
Unit introduction
This unit introduces learners to the concept of business ethics and the application of ethical values to business behaviour. The topic applies to any aspect of business conduct, from boardroom strategies to how organisations treat their suppliers, to sales techniques, to accounting practices and to how they respond to wider issues of social concern such as sustainability. Ethics go beyond the legal requirements and are, therefore, discretionary. It is about how an organisation does its business and how it behaves intrinsically.
Ethical behaviour shows that an organisation considers the moral dimensions of its activities and how it ought to be acting. This unit examines business ethics and how taking an ethical stance affects businesses both internally and externally, including the effects on stakeholders. Learners will explore the social implications of business ethics on a wide range of business activities that affect the organisation itself and the external environment. This will include the ethical stance behind topical issues such as whistle blowing, employment practices, advertising to children, environmental awareness and using new technologies such as genetic modification of food.
As consumers become more ethically aware, explicitly ethical behaviour has increased. Whistle-blowing charters are not uncommon, renewable resources are used in production and products are ‘eco-friendly’. Consumers are now given a choice relating to the products and services that they use and this has given many businesses, such as those that do not use animal testing on cosmetics, the opportunity to grow in niche markets to satisfy consumer demand.
The unit also explores the wider impact of ethical concerns about how business practices can have local, national and global implications. The pressure of communities and groups on business operations has raised awareness of ethical concerns as varied as environmental degradation, executive greed and the use of child labour in the developing world. As people become more aware of different business activities, and as global changes continue to happen, businesses will change how they operate. The unit should develop an understanding of the ethical dimensions of business behaviour.
1 Understand the meaning and importance of ethics in the business world
Operational activities: definitions of business ethics; ethical activities; values of businesses; professional ethics; individual ethical behaviour
Ethical issues: corporate governance; corporate social responsibility; environment; sustainability; human rights; corruption; trading fairly; legal and regulatory compliance; business practices; working conditions; individual ethical responsibilities
2 Understand the implications of businesses operating ethically
Stakeholders: stakeholders (owners, employees, customers, suppliers, competitors, citizens); conflicts of interest between stakeholder groups eg shareholders versus environmentalists
Implications: adapting business behaviour; responding to ethical pressures; implementing ethical practices; influence of stakeholders and pressure groups; impact on competitiveness; reputation; public image; ethical trade; value-added; complying with relevant legislation and codes of practice, eg UK law, EU law; UN Declaration on Human Rights; UN Global Compact; economic activity eg location
3 Know the social implications of business ethics
Areas of activity: ethics in finance, eg bribery, executive pay, insider trading, lobbying; ethics in human resource management, eg discrimination, worker surveillance; ethics in production, eg animal testing, genetically modified (GM) foodstuffs, planned obsolescence; ethics in sales and marketing, eg spamming, shills, product placement, green washing; ethics in intellectual property eg software piracy, counterfeiting, peer-to-peer file sharing
Implications: global, eg environment; corporate, eg legal and regulatory compliance, policies and practices; individual (employee, consumer)
4 Understand ethical concerns facing different communities
Communities: local; regional; national; global; pressure groups, eg Greenpeace, Friends of the Earth; impact of overseeing bodies, eg UK Government, United Nations, European Union, World Trade Organization (WTO), World Health Organization (WHO)
Issues: corporate social responsibility; globalisation; cultural imperialism; ecology; environment; fair trade; corruption; child labour; outsourcing; personal attitudes; whistle blowing
In order to pass this unit, the evidence that the learner presents for assessment needs to demonstrate that they can meet all the learning outcomes for the unit. The assessment criteria for a pass grade describe the level of achievement required to pass this unit.
Assessment and grading criteria
To achieve a pass grade the evidence must show that the learner is able to:
To achieve a merit grade the evidence must show that, in addition to the pass criteria, the learner is able to:
To achieve a distinction grade the evidence must show that, in addition to the pass and merit criteria, the learner is able to:
P1 explain the ethical issues a business needs to consider in its operational activities
M1 assess how a selected business could improve the ethics of their operations
D1 evaluate the impact of a selected business’s ethical behaviour on stakeholders and the business.[IE]
P2 explain the implications for the business and stakeholders of a business operating ethically [IE]
P3 describe the social implications of business ethics facing a selected business in its different areas of activity[IE]
M2 assess the social implications of business ethics facing a selected business in its different areas of activity
P4 examine the ethical concerns of the communities in which a selected business operates.
M3 explain the ethical concerns of the communities in which a selected business operates and suggest measures that could be taken to improve corporate responsibility.
PLTS: This summary references where applicable, in the square brackets, the elements of the personal, learning and thinking skills which are embedded in the assessment of this unit. By achieving the criteria, learners will have demonstrated effective application of the referenced elements of the skills.
The unit should start with an overview of business ethics in relation to business activities and how businesses identify their ethical practices through their mission statements and corporate aims. The Body Shop and Ben & Jerry’s Ice Cream started life as self-declared ethical businesses and might provide a good starting point. The tensions that can arise through takeovers (for example Body Shop/L’Oreal and Ben & Jerry’s/Unilever) and the stances that different stakeholders have will highlight a variety of concerns relating to operational activities. Learners will be able to examine examples using news articles, the Times 100 case studies and topical television programmes such as Panorama. This will naturally link to different issues relating to the learning outcomes.
Consumers are becoming increasingly aware of the importance of ethical business practices and learners should be able to examine the impact that different practices have on business. Organic food and cosmetics that are not tested on animals illustrate the niche markets that can develop. Some businesses suffer because their behaviour is seen as unethical: they use child labour to make footballs, there is a ‘fat cat culture’, or their advertising is offensive.
The first assignment should be introduced early in the delivery programme to give learners the opportunity to choose an organisation and conduct preliminary research into the amount of accessible information that is available. The second assignment should be at an appropriate point later in the programme when learners have had the opportunity to research and discuss many of the ethical issues that impact on a community. This will enable learners to present a balanced view in their article.
Corporate governance is a multi-faceted subject. An important part of corporate governance deals with accountability and mechanisms of auditing and control. The spectacular collapses of financial organisations such as Northern Rock and Lehmann Brothers highlighted the lack of corporate responsibility in the sub-prime mortgage market. The high-profile collapses of firms such as Enron, BCCI, Polly Peck, WorldCom and Parmalat show what happens when corporate governance is poor. The falsification of accounts has led to the collapse of businesses and substantial job and financial losses. Governments will act when business activities are detrimental to the community. The crisis in the financial sector in the aftermath of the credit crunch’ has seen government intervention on an unprecedented scale in an effort to prop up the banking system.
Learners should also be aware of how corporations have reduced costs and increased revenues in ways that have caused concern that the associated behaviour is unethical. Moving production operations to less-developed countries where wages are lower is an example of this. Poor working conditions endured by those making goods for well-known companies are described in Naomi Klein’s No Logo. Issues relating to advertising in terms of legality, decency and truthfulness should be discussed, and the implications of advertising using or aimed at children. Benetton’s controversial advertising campaigns may be explored to develop an understanding of some of the issues surrounding advertising. Learners need to look at how businesses have responded to pressure to act in an ethical manner.
The implications for stakeholders should be explored. This should include the conflicts of interest that arise from the different concerns and interests of the different groups. Businesses also face dilemmas relating to competitiveness in terms of production costs and increasing profits. Seeking to pay lower wages is not, of itself, unethical, but paying lower than subsistence wages and providing bad working conditions are seen as unethical particularly when the business takes a contrasting stance in other areas of activity. Nike promotes the NikeGo 1 mile kids run to promote wellbeing amongst young Americans but Todd McKean, a company spokesman, conceded Vietnamese child labour was used to produce the company’s products. This leads on to an exploration of the impact of pressure groups on businesses to operate ethically. Where applicable, learners should also explore the concept of whistle blowing.
At a national level, learners can consider issues such as how the Government promotes ethical trading and the effect of tax avoidance and evasion on the economy. The Treasury’s website and current newspaper articles would support teaching of these concepts. Learners should consider the benefits and drawbacks of businesses operating ethically and understand why certain business practices may be considered acceptable or unacceptable from the standpoint of particular stakeholders. As learners develop their understanding they should be able to discuss different businesses and explore their ethical practices, including both benefits and drawbacks. If a business stops making products that are harmful to the environment, what are the implications for the employees who may lose their jobs? This then affects the owners when they do not receive a return on their investments. It also affects the supply chain as downstream businesses are affected.
Role play may be used as learners present an organisation’s activities from different stakeholder standpoints. Primark’s decision to drop three of its Indian suppliers when a child labour scandal was uncovered is an example of a topical issue that can provide current material for role play.
The social implications can be explored through considering suitable topics such as the use of genetically modified foods, testing pharmaceuticals on animals or promoting alcohol to young people.
Governments intervene, for example, by banning smoking in public places and the UK has relaxed the opening times for public houses. This will have an impact on business and society.
There is a growing market ethically produced goods and learners could research these producers and examine why, and how, they have chosen to operate ethically. They will also examine why consumers are prepared to pay extra for ethically produced goods such as organic or fair trade products. Many organisations also produce policies and codes of conduct to ensure that their behaviour is fair and ethical irrespective of the location of their operations. Individuals are expected to behave ethically and employers often have codes of behaviour for their employees.
The ethical consequences of business activity should be explored at local, national and global levels. Learners may be able to identify the impact and changes in their own local and wider communities; this may include pressure group activity and types of business activity. Some businesses operate sustainable activities such as replanting trees, providing seed for crops, helping out with clean water projects and so on.
Learners should explore what impact these have in their own and other countries and communities. At each level, local, national and global, there are pressure groups that affect the way businesses operate by encouraging them to adopt ethical stances on a wide range of issues.
Topic and suggested assignments/activities and/assessment
Introduction to ethical concerns facing different communities and key issues:
speaker from a national charity organisation
small group work on case study and research on topical local, regional or national issue
feedback from groups and discussion
small group work on case study and research on global issue
feedback from groups and discussion.
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Assignment 2: Ethical Concerns in the Community of the Selected Company
Learners: assignment research and writing report:
research the ethical concerns of different communities in which a selected business operates
write report.
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Assessment
For P1, learners should examine a selected business and explain its activities from an ethical viewpoint. Learners should examine the business mission statement and corporate aims and objectives (or values and goals) and describe how that business is attempting to show its stakeholders that it is aware of the ethical concerns that apply. (Learners may choose for themselves, but the business should be checked with the tutor to ensure that the learner can meet the criteria.)
P2 allows learners to choose the same business (an alternative one could be used) and examine the impact on the business and its stakeholders of the way the business operates. There may be a conflict of interest between the different stakeholders, and learners will need to explain the reasons for this. There will also be benefits and drawbacks to the business on the way in which it is operating and the learners will need to give reasons and support with examples. ForM1, the evidence will be extended to consider ways that the selected business could change or alter some of its practices, showing how the changes would contribute to ethical behaviour. This then leads into D1 where the learners will need to evaluate the impact that the changes and suggestions would have on their selected business. They will need to support this with evidence of research.
M1 links with P1 and P2, enabling learners to consider how the selected business could improve its operational activities to be more ethical and identify the important factors that would have a positive impact on operations.
Issues raised in P3 are to do with ethical business practices and how the business considers the issues and addresses them in any area of activity. For M2, learners will need to assess the implications of these ethical issues, how they are dealt with and the consequences for different stakeholders.
Evaluation is required for D1 and incorporates the work learners have completed for P1, P2 and M1. Learners should bring their investigations together with relevant conclusions. At this level the work should be supported by evidence relating to their research.
P4 examines the concerns that people have about the ethical behaviour of a business. The role of government organisations and pressure groups can be considered here. M3 extends P4.
The table below shows a programme of suggested assignments that cover the pass, merit and distinction criteria in the grading grid. This is for guidance and it is recommended that centres either write their own assignments or adapt Edexcel assignments to meet local needs and resources.
Criteria covered Assignment title Scenario Assessment method
P1, P2, P3,
M1, M2,
D1
Business Ethics. A Study of a Selected Company
Brief from an independent review body. Learners to conduct research into business ethics in a selected organisation.
Collated research data.
Report.
P4, M3 Ethical Concerns in the Community of the Selected Company
Brief from a newspaper to write an article on the ethical concerns of a community where a selected business operates.
Collated research data.
Article for a newspaper.
Links to National Occupational Standards, other BTEC units, other BTEC qualifi cations and other relevant units and qualifi cations
This unit forms part of the BTEC Business sector suite. This unit has particular links with the following unit titles in the Business suite:
Level 2 Level 3
Business Purposes The Business Environment
Business Organisations Business Resources
Financial Forecasting for Business Introduction to Marketing
Business Online Business Communication
Essential resources
For this unit learners should select an organisation and research its approach to ethical issues. They will require access to websites, newspaper articles and journals in order to conduct their research. Topical case studies will be needed to facilitate group work and discussions.
Employer engagement and vocational contexts
Centres should develop links with organisations such as local businesses, pressure groups and charities that can provide visiting speakers on various aspects of business ethics. The centre as an organisation can be a valuable resource both for guest speakers and as a vehicle for topical case studies related to ethical issues. Learners may be able to access information from their part-time jobs related to the organisation’s ethical policies.
Chryssides G D and Kaler J H – An Introduction to Business Ethics (Thomson Learning, 1993) ISBN 1861523564
Fisher C and Lovell A – Business Ethics and Values: Individual, Corporate and International Perspectives (FT Prentice Hall 2008) ISBN 039564267
Gillespie A – Business in Action ‘The Business of Business’ (Hodder Arnold, 2002) ISBN 0340848200
Journals
Business Review Magazine (Philip Allan Updates)
Economic Review Magazine (Philip Allan Updates)
Ethical Consumer (ECRA Publishing Ltd)
Company annual reports
Materials from relevant charities and pressure groups, such as Amnesty, World Development Movement, Compassion in World Farming, Friends of the Earth, Greenpeace, Baby Milk Action, Campaign against the Arms Trade, Anti-slavery International.
Websites
http://en.wikipedia.org/wiki/Business_ethics Business ethics from Wikipedia, the free encyclopaedia
www.bbc.co.uk/news BBC News
www.benjerry.co.uk Ben & Jerry’s Ice Cream
www.business-ethics.com Business Ethics online magazine
www.business-ethics.com/100best.htm Business Ethics online – 100 Best Corporate Citizens
www.ethicalconsumer.org Ethical Consumer
www.ethical-junction.org Ethical businesses directory for the UK and Ireland
www.ethicalthreads.co.uk Ethical clothing and merchandise
www.uk.oneworld.net/guides Guides on wide range of ethical issues
www.ft.com Financial Times
www.hm-treasury.gov.uk HM Treasury
www.ibe.org.uk/faq.htm Institute of Business Ethics
www.loreal.com L’Oreal
www.nike.com Nike
www.nologo.org Official No Logo site
www.redbox.gov.uk The Red Box, an interactive resource to teach learners about tax and public spending
www.tax.org.uk The Chartered Institute of Taxation
The Corporation (Joel Bakan, 2003) – a documentary film exploring the world of corporations and the impact they have on children, health and the environment. This film is not essential, but good viewing.
Delivery of personal, learning and thinking skills
The table below identifies the opportunities for personal, learning and thinking skills (PLTS) that have been included within the pass assessment criteria of this unit.
Skill When learners are …
Independent enquirers explaining the implications for the business and stakeholders of a business operating ethically
describing the social implications of business ethics facing a selected business in its different areas of activity
evaluating the impact of a selected business’s ethical behaviour on stakeholders and the business.
Although PLTS are identified within this unit as an inherent part of the assessment criteria, there are further opportunities to develop a range of PLTS through various approaches to teaching and learning.
Skill When learners are …
Independent enquirers exploring ethical issues or problems arising from research, from different perspectives
Creative thinkers asking questions and extending their thinking on ethical issues with visiting speakers and in group work
questioning their own and others’ assumptions in group work and through their research on business ethics
Reflective learners inviting feedback and dealing positively with praise, setbacks and criticisms when working in groups
Team workers providing constructive support and feedback to others in group work exercises on business ethics
Self-managers managing their emotions and building and maintaining relationships when working in groups on ethical issues
Effective participators acting as an advocate for views and beliefs that may differ from their own when working in groups on ethical issues.
The aim of this unit is to introduce learners to the interaction between the general economic environment and business activity and how the interactions generate national wellbeing. Learners will study how government activities regulate and influence business activities and how business activities influence government action and policy.
Unit introduction
Businesses operate in an environment shaped by the government. Government seeks to control the general level of prices (inflation), employment levels, economic growth and the balance of payments. A range of techniques is used to influence these variables but changes made by the government have a direct impact on individual businesses. Raising interest rates may reduce demand as it becomes more expensive for consumers to borrow. This means that businesses will have to reduce output and possibly make staff redundant. The cost of borrowing to pay for new investment goes up so implementing newer technologies might be delayed, reducing an organisation’s competitiveness. Changes in the business environment will impact on individual organisations.
Government spending has a significant impact on business as it is such a high proportion of the gross domestic product. Spending on infrastructure projects such as upgrading the west coast main railway line or building new sports facilities for the Olympic Games have a multiplier effect at both the national and local level. Suppliers of related goods and services prosper. In recession, the government uses spending as a means of stimulating economic activity.
Fiscal and monetary policies are two of the main tools available to government for regulating most economic activity. Fiscal policy uses taxation and spending to influence the economy. The annual spending review and budget identify spending plans and how they will be financed from the public purse. Fiscal policy aims not only to raise revenue for spending but it is also used to re-distribute income. Deflation and reflation are controlled through monetary policy and the supply of money using interest rates. Monetary policy provides the means for ensuring macroeconomic stability.
In the UK, government and business have to operate within the legal and regulatory framework established by both UK, Government and the European Union (EU) and other trans-national institutions. Harmonising legislation and regulations has ensured the adoption of the working time directive limiting how many hours employees can work. In many parts of the economy there are employees who have migrated to the UK to work, one of the most obvious impacts of belonging to the EU and something which benefits many employers who have needed to fill vacancies in boom times.
1 Understand the impact on businesses of changes in the economic environment
Economic environment: business cycle (growth, recession); indicators, eg changes in gross domestic product (GDP), rates of inflation and deflation, employment rates, trade surpluses/deficits; balance of payments; conflicting objectives; ‘ripple effects’ of downturns in particular industries eg housing, construction and manufacturing; structural adjustments; welfare considerations
Government policy: economic policy; industrial policy; competition policy; fiscal policy; social policy; education and training policy; transport policy; regional policy; environmental policy
2 Know how government spending impacts on businesses
Government spending: public services via central and local government agencies; private and voluntary sector business organisations; deficit funding; government spending and the multiplier mechanism; local impacts of funding; private finance initiatives
3 Understand fiscal and monetary policies and the effects on spending
Fiscal policy: direct and indirect taxation; capital allowances; impact of changes on costs, aggregate demand and tax free allowances; potential annual revision; public finances; public sector borrowing; comprehensive spending review; pre-budget report; budget; re-distribution of income
Monetary policy: aggregate demand and trading conditions; monetary policy; interest rate changes; inflation, employment levels; investment decisions; impacts of actual and anticipated changes
4 Know how the international economy affects UK businesses and competition
European factors: role of European Union (EU); performance of European Union economies; European policies eg agriculture (CAP), business, growth, employment, education, economics and finance, employment, environment, science and technology, regional, external relations, social; the European Monetary Union (EMU)
Global factors: World Trade Organisation (WTO); trading blocs; stock market fluctuations; credit availability; global warming; political stability, war; industry-specific developments (oil, gas, motor); environment, eg Kyoto Protocol, Rio Earth Summit; genetically modified products; outsourcing; globalisation; emerging economies (tiger economies, BRIC economies)
In order to pass this unit, the evidence that the learner presents for assessment needs to demonstrate that they can meet all the learning outcomes for the unit. The assessment criteria for a pass grade describe the level of achievement required to pass this unit.
Assessment and grading criteria
To achieve a pass grade the evidence must show that the learner is able to:
To achieve a merit grade the evidence must show that, in addition to the pass criteria, the learner is able to:
To achieve a distinction grade the evidence must show that, in addition to the pass and merit criteria, the learner is able to:
P1 explain the effects, of changes in the economic environment on a selected business [IE]
M1 analyse the implications of government policies for a selected business
D1 evaluate the impact of changes in the economic environment on a selected business
P2 identify how government policies impact on a selected business [IE, RL]
P3 identify the impact of government spending on a selected business [IE, CT]
P4 explain how both fiscal and monetary policy decisions have affected a selected business [IE]
M2 analyse the effects of fiscal and monetary policies for a selected business in terms of the market it operates in
D2 suggest and justify elements of fiscal and monetary policies that would help a selected business achieve its objectives.
P5 describe the impact of international factors on a selected business. [IE]
M3 assess the impact of changes in the global and European business environment on a selected business.
PLTS: This summary references where applicable, in the square brackets, the elements of the personal, learning and thinking skills which are embedded in the assessment of this unit. By achieving the criteria, learners will have demonstrated effective application of the referenced elements of the skills.
Businesses operate in a national and international context. The role of government and international institutions in establishing and maintaining the business climate to ensure organisations prosper is considered. Emphasis should be placed on showing how businesses operate against this background by looking at current issues. These should be related to some of the theoretical issues. For example, the short-term cut in value added tax assumed that spending would be stimulated as prices fell. However, the consequences were mixed not least because households wanted to increase their savings and reduce their level of debt. This sort of issue occurs infrequently and receives extended coverage in the press, on the radio and on television.
Business activity is cyclical and encapsulated by the phrase ‘boom and bust’. Consideration should be given to the business cycle and the associated economic indicators. Governments try to manage the cycle but governments of different political persuasions have different priorities. A conservative chancellor once remarked, ‘Rising unemployment and the recession have been the price we have had to pay to get inflation down. That price is well worth paying.’ The broad objectives of policy are articulated consistently but they are not always compatible. Examples of the tensions between policy objectives should be examined as should the mechanisms that are used to ensure objectives are met Account needs to be taken of the current economic perspectives of government as these will impact differently on business. A wide range of policies exist that define the business landscape and these will shape what businesses do, whether coercively – such as land fill tax to encourage better waste management, or voluntarily – by labelling drinks glasses with the number of units of alcohol the glass contains. Learners need to be aware of current business developments and these are well covered in the financial pages of the broadsheet press and in specialist publications such as the Economist. Encourage learners to look at what is going on around them locally. Asking learners to consider regional and local development plans by listening to staff from the local authority or attending meetings will indicate how the broad national issues are worked out locally. Local newspapers will provide useful information sources in identifying specific local or regional case studies, especially where local councils change hands.
Government spending has a major impact on business. It accounts for around 45 per cent of gross domestic product. Education, health, policing and defence are four major areas of government expenditure with significant consequences for employment and for the associated supplier businesses. Learners can be introduced to the multiplier effect of spending in a non-technical way. There will be local examples of the multiplier effect as businesses open up or shut down. The construction of Olympic facilities has a major multiplier effect, particularly in London. The decision to locate government departments in Bootle and Washington had a significant impact on the north east and north west of the country. The slimming down of the civil service through the Gershon review will have a negative effect in the areas affected.
Fiscal policy is the government’s use of taxation as a measure to stabilise the economy, raise revenue and fund government expenditure. Learners can examine spending reviews, the pre-budget report and the budget, which the Chancellor of the Exchequer usually announces in March each year. The significance of the measures can be examined in terms of the impact on national and local organisations. Taxation also has an impact on particular industries. Alongside tax and allowance regimes that are not specific to particular businesses there are others that are industry specific such as purchase taxes on new vehicles, fuel duty and alcohol duty. Studying particular businesses will indicate the impact of tax policies on these activities.
Monetary policy affects macroeconomic variables, such as output, employment and inflation. The Bank of England (Monetary Policy Committee) meets monthly to look at the Retail Price Index (RPI) and Consumer Price Index (CPI), along with other indicators, and attempts to keep the economy stable through changes in interest rates. This then affects the level of spending in the UK. Learners should identify the effects that rising and falling interest rates have on businesses. After each monthly meeting of the MPC there is wide coverage of the news media which learners should follow.
Businesses will also be affected by a wide range of external influences. The decisions of the European Union, and the obligation to enshrine EU requirements in UK law, have an obvious effect on business. UK households will have to adopt energy efficient lighting from 2010 so there are obvious implications for companies that manufacture lighting, as well as for businesses that have to meet the revised requirements. Remaining outside the EMU has implications for businesses trading with EU partners as the pound moves against the Euro.
On a global level, the business climate is affected by decisions taken by cartels, such as OPEC to regulate the flow of oil, and by world events such as initiatives to stem global warming. The Intergovernmental Panel on Climate Change (IPCC) was set up by the World Meteorological Organization (WMO) and the United Nations. It will influence business activity in a myriad of ways, some of which are clear and some less clear and will only become apparent in years to come.
Outline learning plan
The outline learning plan has been included in this unit as guidance and can be used in conjunction with the programme of suggested assignments.
The outline learning plan demonstrates one way in planning the delivery and assessment of this unit.
Topic and suggested assignments/activities and/assessment
Introduction to unit and structure of the programme
Introduction to the significance of the economic and business environment to organisations
Pair work (group work) on the business cycle over the recent past. This will be supported by tutor input on technical topics. Learners:
investigate the business cycle and the reasons for fluctuations in the cycle.
identify the aims of government policy in managing the business cycle
explain how the aims of government policy need to be reconciled
consider how changes in the business cycle affect particular businesses.
examine the range of government policies that have an impact on business
explain how specific government policies affect individual businesses.
There will be formal input during individual, paired and group work.
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Assignment 1 – Impact Of Economic Change on a Selected Business
Investigation, discussions and presentations on the business cycle and how government policy affects businesses
Pair work on the role of government spending in the economy and its impact on businesses. This will be supported by tutor input on technical topics. Learners:
investigate the size of and trends in government spending
investigate the nature of government spending
identify the importance of government spending to businesses and communities
consider the multiplier effect of government spending by considering national and local examples
explain the role of private finance initiatives.
There will be formal input during group work
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Investigation, discussions and presentations on national and local government spending.
Topic and suggested assignments/activities and/assessment
Pair work on the role of fiscal and monetary policies and the significance for individual businesses. This will be supported by tutor input on technical topics. Learners:
define fiscal policy and its components
identify the role of fiscal policy
explain the need to raise revenue to fund expenditure
examine the importance of deficit financing
explain the budgetary process
examine the impact of fiscal policy on business
define monetary policy and its components
identify the role of monetary policy
explain how the government manages monetary policy
examine the impact of monetary policy on businesses.
There will be formal input during group work.
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Assignment 2 – Fiscal and Monetary Factors
Investigations, discussions and presentations on the role of fiscal and monetary policies and their impact on businesses.
Pair work on the impact of European and global factors on business activity. This will be supported by tutor input on technical topics. Learners:
identify the impact of EU membership on UK business activities
explain how EU policies affect businesses
identify the impact of global issues on UK business activities
explain how global developments affect businesses.
There will be formal input during group work.
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Assignment 3 – Impact of International Economic Change on a Selected Business
Investigations, discussions and presentations on the impact of European and global factors on businesses.
Supervised assignment time
Non-supervised study time and completion of assignments
For P1, learners should explain the likely effect of variations in the economic environment on a selected business, by examining the business cycle and indicators that describe it, such as inflation, employment, growth and international trade. Learners should choose an appropriate business in order to examine the impact of any changes. A local example or a major national example will help ensure sufficient information is available.
For P2, learners need to consider the wide range of government policies that impinge on business and select those that have a significant effect on the selected business. The impact of policies will vary between businesses depending on their size, location and type of activity. It makes sense to use the same organisation as used for P1.
For P3, learners should consider the impact of changes to government spending on a selected business at a local, national or European level. If government spending is declining, demand for a business’s products or services will fall. This will have predictable consequences on the revenues, profits and employment for both the individual business and the economy as a whole. Learners can also analyse the likely impact on a selected business organisation of a significant change in the level of public spending in terms of altered demand and the adjusted output, purchases, overheads and long-term growth. Learners should trace the knock-on effects in response to these changes and explain the multiplier effect.
For P4, learners must examine fiscal and monetary policies in relation to a chosen business. This will involve analysing the possible impact of changes in the tax regime, as well as interest rate changes, on a selected business’s operations. The range of possibilities is extensive and will vary over time so care will be needed in identifying what is relevant at any one time.
For P5, learners should describe the implications for a selected business of European and global factors. Again, these will very between types of business and over time. However, some developments are long term. European requirements will continue to be incorporated in to UK legal and regulatory frameworks. Global warming will involve a continuing series of initiatives to reduce carbon emissions.
For M1, learners should analyse the impact that government policies have on a selected business and the possible reactions of the business to the decisions. Planning approval for a high speed rail link has allowed the local train operating company to run services that use the same track as Eurostar trains. This requires the train operating company to buy new rolling stock and power cars. New engineering facilities and additional staff training from local providers will be needed and people will move in to the areas affected by the upgraded train services.
For M2, learners are required to analyse the effects of fiscal and monetary policy decisions have on business. The “credit crunch” saw a temporary reduction in VAT and a fall in interest rates to historically low levels designed to stimulate demand. These changes illustrate the impact of fiscal and monetary policy at both a national and local level.
For M3, learners can assess the impact on a business of changes in European and global factors. This will show an awareness of the implications for business of an international environment where many factors are beyond the control of the business. This might mean restructuring operations and modifying products but businesses will need to be quick to exploit changes in the international environment.
For D1, learners should evaluate the impact of changes in the economic environment on a selected business in relation to government decisions, policies, spending and economic management. Learners need to examine the information and draw justified conclusions as to how the business might respond.
For D2, learners should suggest and justify elements of fiscal and monetary policies that government could use that would help a selected organisation achieve its objectives
The table below shows a programme of suggested assignments that cover the pass, merit and distinction criteria in the grading grid. This is for guidance and it is recommended that centres either write their own assignments or adapt any Edexcel assignments to meet local needs and resources.
Criteria covered Assignment title Scenario Assessment method
P1, P2, P3, M1, D1 Impact of Economic Change on a Selected Business
A case study of a selected local or national business.
Case study.
P4, M2, D2 Fiscal and Monetary Factors
You are been commissioned to conduct research on the impact of current Fiscal and Monetary policy on a selected business.
Report.
P5, M3 Impact of International Economic Change on A Selected Business
You are making a presentation to the local Chamber of Commerce on the impact of international economic factors on a selected business.
Presentation.
The assignments will cover:
describing the effects of changes in the economic environment on a selected business
identifying how government policies impact on a selected business
identifying the impact of government spending on a selected business
outlining how both fiscal and monetary policy decisions have affected a selected business
describing the impact of international factors on a selected business.
Links to National Occupational Standards, other BTEC units, other BTEC qualifi cations and other relevant units and qualifi cations
This unit forms part of the BTEC Business sector suite. This unit has particular links with the following unit titles in the Business suite:
Level 3
The Business Environment
International Business
Essential resources
For this unit learners should have access to a suitable business teaching environment and access to current resources about government policies and the economy. Current and specific information is easy to come by. Government websites and departments of state provide up to date detailed information. Various references books provide details about UK business and the economy. The EU website provides comprehensive information on all EU activities. Local organisations and businesses can provide information about the impact of government from a personal perspective.
Centres should develop links with local employers who are affected by government policy and the associated economic environment. Many businesses look to employ business learners when they finish their programmes of study.
Indicative reading for learners
Textbooks
Gillespie A – Business in Action (Hodder Arnold, 2002) ISBN 0340848200
Marcouse I et al – Business Case Studies, 2nd Revised Edition (Hodder Arnold, 2003) ISBN-10 0340811102
Sawyer M – The UK Economy, 16th Revised Edition (OUP Oxford, 2000) ISBN-10 0199266514
Whitaker’s Almanack 2009 141st Revised Edition (A & C Black Publishers Ltd) ISBN-10 1408104229
Journals
Business sections of broadsheet newspapers.
The Economist
The Financial Times
Websites
www.bized.co.uk business studies resources for teachers and students
www.britishchambers.org.uk the British Chambers of Commerce site for exporting
www.businesslink.gov.uk the Business Link site for importing and exporting
www.direct.gov.uk follow the links to information for businesses which then has links to specific information at the Department for Business and Regulatory reform (BERR)
europa.eu is the website of the European Union
news.bbc.co.uk/1/hi/country _profiles/default.stm provides up to date country profiles
www.thetimes100.co.uk business studies resources for teachers and students
Delivery of personal, learning and thinking skills
The table below identifies the opportunities for personal, learning and thinking skills (PLTS) that have been included within the pass assessment criteria of this unit.
Skill When learners are …
Independent enquirers describing the effects of the business cycle on business activity
identifying how government policies affect business
identifying the impact of government spending on business
outlining how fiscal policy affects business
outlining how monetary policy affects business
describing the impact of international factors on business
Creative thinkers considering how government policies might affect businessesReflective learners reviewing and reflecting on their work in examining the impact of government
policy on national and local business.
Although PLTS are identified within this unit as an inherent part of the assessment criteria, there are further opportunities to develop a range of PLTS through various approaches to teaching and learning.
Skill When learners are …
Independent enquirers planning and carrying out research into the business cycle
planning and carrying out research into government policies and how they affect businesses
planning and carrying out research into the significance of government spending for national and local business
planning and carrying out research into the impact of fiscal and monetary policy on business
planning and carrying out research into the impact of international factors on business
Creative thinkers looking at how the multiplier effect works its way through the local and national economy
reviewing how businesses might respond to international factors
using questioning skills when interviewing people about the impact of government decisions on business
Reflective learners considering the consequences of the changing business context for business activity
inviting feedback on their own performance when researching and obtaining information
evaluating their experiences and learning to inform future progress
Understand routine and non-routine problems in a wide range of familiar and unfamiliar contexts and situations
using numerical data in analysing government policies and the possible impact on business. This may involve making predictions based on an analysis of historic data or using simple business models
Identify the situation or problem and the mathematical methods needed to tackle it
Select and apply a range of skills to find solutions
Use appropriate checking procedures and evaluate their effectiveness at each stage
Interpret and communicate solutions to practical problems in familiar and unfamiliar routine contexts and situations
Draw conclusions and provide mathematical justifications
English
Speaking and listening – make a range of contributions to discussions and make effective presentations in a wide range of contexts
carrying out group work when investigating government and business policies and responses to these policies
asking questions when carrying out research
testing the validity of ideas
Reading – compare, select, read and understand texts and use them to gather information, ideas, arguments and opinions
reading about government policy, international factors and business activities
reviewing the legal and regulatory requirements in response to government policies and international factors that govern business activity
considering ideas about the effectiveness of fiscal and monetary policies
Writing – write documents, including extended writing pieces, communicating information, ideas and opinions, effectively and persuasively
preparing abstracts of information from government and business sources
preparing materials to be used in presentations
producing questions to be asked at interviews when obtaining information.
