Business Organisations and Environment Paper 1

C Rationale: Collective goals or aims are a feature of organisations. Pitfalls: Watch out for closely related terminology like ‘goals’ and ‘tactics’. You might have thought ‘tactics’ would fit here, but they are the lower level plans of functions: they may not be shared by the organisation as a whole. Ways in: If you didn’t know the definition, you could have got to the answer by ruling out the other options. Stakeholders doesn’t fit ‘pursues’; profits are not the objective of all organisations; and tactics are at a lower level than goals.

C Rationale: Synergy is the 2 + 2 = 5 factor, and is one of the key reasons for the formation of teams and organisations. Pitfalls: You need to read all the options carefully, especially if they look similar and all ‘sound’ plausible. Ways in: You should be able to define the other options, to confirm that they do not fit the definition given.

B Rationale: In a limited company, the owners (shareholders) are separate from the managers of the concern (board of directors). Pitfalls: Some options look plausible because of the wording. ‘Limited’ doesn’t mean ‘only being allowed to trade up to’ – but looks as if it might. The second half of the statement about partnerships is true – but this doesn’t mean that the first half is also true. Ways in: You should have been able to rule out A (no company’s turnover is limited), C (sole traders do have personal liability for debts: they do not have ‘limited liability’) and D (ordinary partnerships are different from limited companies).

C Rationale: Such an organisation is part of the public sector. The voluntary sector comprises charities and other organisations whose members are volunteers. Private sector comprises nongovernmental organisations, such as limited companies. Pitfalls: Watch out for ‘public’ and ‘private’ sector terms – and be able to distinguish clearly between them.

B Rationale: All these groups have a legitimate stake in the enterprise: the government, as a regulator; employees, as participants in the business; and environmental pressure group and local residents, because of potential impacts. Pitfalls: Don’t forget external stakeholders!

C Rationale: Primary stakeholders are those who have a contractual relationship with the organisation, including some internal and connected stakeholders. Secondary stakeholders are therefore external stakeholders.

D Rationale: A co-operative is a business which is owned by its workers or customers, who share the profits. Others features include open membership, democratic control, distribution of surplus in proportion to purchases and promotion of education.

C Rationale: PEST stands for Political, Economic, Socio-cultural and Technological. Pitfalls: SWOT (Strengths, Weaknesses, Opportunities, Threats) is a related exercise, as PEST data is fed into the O/T part of the business appraisal. Ways in: You could eliminate as many distractors as you could identify: SMART (Specific, Measurable, Attainable, Relevant, Time-bounded) refers to objective-setting.

C Rationale: This would be interpreted as corruption. The other options are usually legitimate methods of influence. Although B may be questionable in some parts of the world, in others like the UK it is perfectly legitimate.

D Rationale: The statement defines demographics. Ergonomics is a study of the interaction of humans and their environments (used in design of office equipment and furniture, for example). Psychographics is the study of psychological factors (used in selection testing, for example). Ways in: You could eliminate as many distractors as you could define in other ways.