ANALYSING A BUSINESS REPORT

Here is an example of a business report question from the 2001 HSC exam. There is a sample answer with comments on the following pages.

Question:

In your answer, you will be assessed on how well you:

  • use your knowledge and the information provided
  • communicate using relevant business terminology and concepts
  • present a logical, well-structured answer to the question in the form of a business report

Write a business report to the owners of this business that explainsoptions for funding its expansion into e-commerce and strategies for managing this change to achieve effective employment relations and social responsibility.

SAMPLE BUSINESS REPORT – 2001 HSC

Situational Analysis

Spatial Internet, a computer and internet company, has been in operation for 2 years, and despite rapid initial growth while in the growth stage of its business life cycle, stronger competition has been experienced resulting in a threat to the business’s market share.

Furthermore, troubles retaining its staff, existing mostly of young, highly educated and mobile staff have been experienced, resulting in high levels of staff turnover. A strategic goal of Spatial Internet is to expand in the internet-aided facility of e-commerce.

Funding options for E-commerce proposal

Funding for this venture could come through –

  1. Owners Equity or Retained Profits: By reinvesting this money into the business Spatial Internet will be given the ability to finance its proposed e-commerce facility.
  2. Bank Loan: Through borrowing, mainly from financial intermediaries such as banks, larger amounts of finance will be made available to the business, however the duration and interest rate charged for the loan will have to be considered.
  3. Leasing: As this business is computing and internet related, they would have excess products. By selling their equipment, such as the store’s computer (i.e. office and business use, not those for sale), and then renting them back, the business will receive an immediate injection of money. This can, in turn, be used to finance the business venture of e-commerce. While the business already sells such products as internet connection facilities, computers, modems and other accessories, Spatial Internet is already connected to the Internet with their own website. As the business only needs to develop the order form and online payment aspects of the website, fewer costs are needed.
  4. Overdraft: As Spatial Internet already has a mortgage, an overdraft could be used as a fast and effective initial injection of cash into the business in order to fund the e-commerce prospect.

Of these options, leasing would probably prove to be the most effective method, or by reinvesting retained profits of the business.

Managing Change Strategies

ACHIEVING EFFECTIVE EMPLOYMENT RELATIONS

With its problem of high staff turnover, Spatial Internet needs to carefully manage the proposed changes. The young, highly educated and mobile staff feel that they are not appreciated to their total value, and are thus leaving and seeking more rewarding jobs. As young people, their lives are extremely busy and they desire a flexible workplace.

Similarly, staff overheard the proposed for e-commerce, and to date, have not been informed by management. This furthermore decreases their feelings of self-worth and responsibility.

Strategies could include:

  • Increasing Employee Responsibility

This will result in employees feeling wanted and useful in the business. Specified areas could be delegated, for example: Internet, Computing Packages. Training the staff will also result in the employees being knowledgeable regarding the e-commerce facilities, and thus reducing the risk of inertia towards the change.

  • Increased Financial Rewards

Staff could be provided with financial incentives, e.g. increased pay, company car, shares in the business. As the possibility of losing market share to competitors is evident, rewards and benefits could be instigated. Thus, as profits increase, so do the employee’s rewards. This will increase their sense of worth in the business, decrease their likelihood of quitting from the business, and thus, improve the employee relations.

  • Non-Financial Rewards

Non-financial rewards could be given to staff members as a strategy of enhancing working conditions, thus increasing employee satisfaction, resulting in more effective employment relations.

ACHIEVING EFFECTIVE SOCIAL RESPONSIBILITY

Through its proposal for using e-commerce, Spatial Internet must ensure they abide by, and fulfill its social responsibility. Spatial Internet has the social responsibilities of:

* Ensuring Safe Work Practices

Spatial Internet has the social responsibility of abiding by work safety regulations, in order to ensure employee’s safety is not compromised. For example, while implementing the e-commerce facilities, employees’ safety must be ensured to minimise their rate of illness or injury. While in a computer and internet store, technology plays a vital role, however electrical cords must be stored properly, and the floor free from hinderous items.

* Providing Career Prospects for Employees

This strategy acts in the best interests of both employees and employers. With a high rate of staff turnover, employees would be more likely to continue working for Spatial Internet if career prospects were evident. By increasing employee knowledge and responsibility through training anddivision of labour, employees will feel as if they are appreciated by the business and will therefore reduce the high rate of staff turnover. This social responsibility is not necessary however it does increase the employee’s sense of self-worth and thus their willingness to continue working at Spatial Internet. By providing the employees with career prospects, the business in turn gain decreased staff turnover.

* Responsibility to the Environment

With e-commerce facilities, Spatial Internet will be responsible for delivery of the items. By packaging the product in cardboard boxes instead of polystyrene, ecological sustainability is enhanced.

Report Summary

It is these prospects and options that are recommended for your business, Spatial Internet.

Yours sincerely,

ABC Managing and Business Advice Company