NCEA Level 3 Business Studies 91379 (3.1) — page 1 of 1

SAMPLE ASSESSMENT SCHEDULE

Business Studies 91379 (3.1): Demonstrate an understanding of how internal factors interact within a business that operates in a global context

Assessment Criteria

Achievement / Achievement with Merit / Achievement with Excellence
Demonstrate understanding typically involves explaining the interaction of internal factors through
  • stating examples
  • stating business knowledge relevant to the interaction of internal factors
  • stating a Māori business concept(s) where relevant to the interaction of internal factors.
/ Demonstrate in-depth understanding typically involves fully explaining the interaction of internal factors through:
  • including examples to support explanations
  • including business knowledge relevant to the interaction of internal factors to support explanations
  • including a Māori business concept(s) where relevant to the interaction of internal factors to support explanations.
/ Demonstrate comprehensive understandingtypically involves evaluating the interaction of internal factors through:
  • integrating examples to fully support explanations
  • integrating business knowledge relevant to the interaction of internal factors to fully support explanations
  • integrating a Māori business concept(s) where relevant to the interaction of internal factors to fully support explanations.

Evidence Statement

One / Expected Coverage
(a) / Possible causes of inertia may hinder change in a business because some employees may:
  • be resistant to change due to self-interest; this occurs because people are more concerned with the implication of the change for themselves rather than considering the effects for the success of the business
  • be resistant to change due to a misunderstanding because the purpose of the change has not been communicated effectively or has been interpreted differently
  • have a low tolerance to change because they prefer having security and stability in their work
  • make different assessments of the situation; this occurs because workers and management do not agree with the reasons for the change and with the advantages and disadvantages of the change process.

(b) / Evidence may include:
Communication: Educate people about the changes beforehand. Communication, before the change takes place, helps employees see the logic and reduces rumours. This management strategy:
  • will increase information on the move over to China so workers will be more informed
  • does not mean that the company had dealt with the causes of the inertia, they have merely provided greater information.
Participation and involvement: When employees are involved in the change program they are more likely to agree with change rather than resist it. This management strategy:
  • is likely to lower resistance and may increase motivation because people feel more involved
  • may cause change to take a longer time and be more costly, which would reduce profitability.
Support: Management can avoid potential resistance by being supportive of employees during this difficult time. This management strategy:
  • will make employees feel they are supported by the company and they may be more motivated and productive
  • may be expensive in meeting the housing or other needs of managers.
Negotiation: Managers can overcome resistance by offering incentives to employees. This can be done by allowing people, who are resistant to change, alter elements of the movement that they find threatening. This management strategy may:
  • be expensive and time consuming, which would increase the costs of change and reduce profitability
  • mean that managers feel more supported and therefore motivated to move to China.
Coercion: Managers can openly force employees into accepting the change by making it clear that resisting change can lead to employees losing jobs or the firing of or not promoting of employees. This management strategy would:
  • create change quickly and is cheaper that other change management methods
  • only work well if managers do not have alternative employment, which may mean the firm loses good managers and productivity.

(c) / Autocratic: Authoritarian leaders make decisions independently and direct workers that they have to move to China to support the development of the new factory.
Positive impacts:
  • It may work effectively when timelines are short (as they are in this case) because this leadership style does not need a prolonged decision-making process.
  • It may work effectively with low-skilled workers because they are being told what to do.
Negative impacts:
  • Managers may be highly-skilled and feel undervalued, which will reduce motivation.
  • May create a poor strategy because there is little input from others in the team.
Democratic: Democratic leaders offer guidance and support to the people who will be travelling to China, but they also allow these people to have input into the strategy.
Positive impacts:
  • It maximises input from all managers, which leads to a more effective and agreed strategy.
  • It may increase motivation because it makes people feel more valued.
Negative Impacts:
  • It requires an experienced manager to lead the process.
  • It may cause the implementation of the change to take longer than an autocratic leadership style.
Laissez-Faire leaders offer little or no guidance to group members and leave decision-making up to group members.
Positive Impacts:
  • Managers may be more motivated if they are allowed to make their own decisions about travelling to China.
  • It may be effective becauseNZ Pure has competent experienced management.
Negative Impacts:
  • It is generally only effective in situations where timelines are longer – they are not in this case.
  • It might mean that too few people travel to China because they may not choose to go.
Conclusions:
A democratic leadership style would be more effective because this is a large change for NZ Pure and the business would need support and input from all areas of the management OR
An autocratic leadership style would be more effective because there is a very short timeline and changes need to happen quickly.
Not Achieved / NØ / No response; no relevant evidence.
N1 / Candidate provides insufficient breadth by giving ONE of:
  • an explanation of a cause of change inertia
  • an explanation of a change management strategy that will encourage workers to move to China
  • an explanation of ONE advantage ORONE disadvantage of the change management strategy
  • an explanation of how ONE leadership style would be employed to manage the change
  • an explanation of a positive ORa negative impact of ONE leadership style.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
N2 / Candidate provides insufficient breadth by giving TWO of:
  • an explanation of a cause of change inertia
  • an explanation of a change management strategy that will encourage workers to move to China
  • an explanation of ONE advantage ORONE disadvantage of the change management strategy
  • an explanation of how ONE leadership style would be employed to manage the change
  • an explanation of a positive OR a negative impact of ONE leadership style.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
Achievement / A3 / Candidate answers THREE of:
  • an explanation of a cause of change inertia
  • an explanation of a change management strategy that will encourage workers to move to China
  • an explanation of ONE advantage ORONE disadvantage of the change management strategy
  • an explanation of how ONE leadership style would be employed to manage the change
  • an explanation of a positive OR a negative impact of ONE leadership style.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
A4 / Candidate answers FOUR of:
  • an explanation of a cause of change inertia
  • an explanation of a change management strategy that will encourage workers to move to China
  • an explanation of ONE advantage ORONE disadvantage of the change management strategy
  • an explanation of how ONE leadership style would be employed to manage the change
  • an explanation of a positive ORa negative impact of ONE leadership style.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
Merit / M5 / Candidate fully explains ONE of:
  • A change management strategy and its impact on the business, with ONE advantage AND ONE disadvantage
  • ONE leadership style, and ONE positive AND ONE negative impact on NZ Pure’s venture in China.
(Answers will typically include relevant examples, business knowledge OR Māori business concepts.)
M6 / Candidate fully explains BOTH of:
  • A change management strategy and its impact on the business, with ONE advantage AND ONE disadvantage
  • ONE leadership style, and ONE positive AND ONE negative impact on NZ Pure’s venture in China
(Answers will typically include relevant examples, business knowledge OR Māori business concepts.)
Excellence / E7 / Candidate explains how TWO leadership styles would be employed to manage the change
AND
fully explains ONE positiveAND ONE negative impact of each leadership style on NZ Pure’s venture in China
AND
gives a conclusion that justifies the leadership style in relation to the example.
(Answers will typically integrate relevant examples, business knowledge OR Māori business concepts into explanations.)
E8 / Candidate explains how TWO leadership styles would be employed to manage the change
AND
fully explains TWO positive AND TWO negative impacts of EACH leadership style on the business
AND
gives a conclusion that justifies the leadership style in relation to the example.
(Answers will typically integrate relevant examples, business knowledge OR Māori business concepts into explanations.)
Two / Expected Coverage
(a) / Clustering may lead to an excellent supply of human resources that will encourage fast growth.
There may be large demand for the financial products provided by these businesses.
As clustering occurs, other industries may develop to support finance.
(b) / Impact on NZ Pure when choosing to locate its production facility in Tianjin.
Advantages:
  • near to the market (in this case – its customers in Beijing) because this will reduce transport costs for finished products and therefore increase profits
  • nearness to the port will allow easy access to raw materials; this will reduce transport costs for inputs and therefore increase profits
  • availability of skilled or low cost labour because this will increase productivity or reduce costs of production
  • cost of land because this will keep overheads down low.
Disadvantages:
  • distance to Shanghai because this will increase transport costs for finished products and therefore decrease profits.

(c) / Factors to be considered in the evaluation of an international location may include:
  • a large cheap or skilled labour force is required to increase productivity
  • an accessible place to sell the products is essential
  • a good transport network helps reduce costs and make the movement of materials and products easier
  • low cost property is available
  • the factory needs to be close to raw materials if they are heavy and bulky to transport
  • site and land the business requires, eg large accessible areas of cheap land on which to build its factory
  • government policies – industrial development was encouraged by local government.
The converses are disadvantages.
Not Achieved / NØ / No response; no relevant evidence.
N1 / Candidate gives insufficient breadth by giving ONE of:
  • an explanation of ONE factor that might encourage financial companies to cluster in Tianjin
  • an explanation of ONE advantage ORONE disadvantage of locating the production facility in Tianjin
  • an explanation of ONE advantage of the example business’ location
  • an explanation of ONE disadvantage of the example business’ location.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
N2 / Candidate gives insufficient breadth by giving TWO of:
  • an explanation of ONE factor that might encourage financial companies to cluster in Tianjin
  • an explanation of ONE advantage OR ONE disadvantage of locating the production facility in Tianjin
  • an explanation of ONE advantage of the example business’ location
  • an explanation of ONE disadvantage of the example business’ location.
(Answers will typically state relevant examples, business knowledge ORMāori business concepts.)
Achievement / A3 / Candidate answers THREEof:
  • an explanation of ONE factor that might encourage financial companies to cluster in Tianjin
  • an explanation of ONE advantage ORONE disadvantage of locating the production facility in Tianjin
  • an explanation of ONE advantage of the example business’ location
  • an explanation of ONE disadvantage of the example business’ location.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
A4 / Candidate answers ALLof:
  • an explanation of ONE factor that might encourage financial companies to cluster in Tianjin
  • an explanation of ONE advantage ORONE disadvantage of locating the production facility in Tianjin
  • an explanation of TWO advantages, TWO disadvantages (OR an advantage and a disadvantage of the example business’ location).
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
Merit / M5 / Candidate fully explains ONE of:
  • ONE advantage and ONE disadvantage of NZ Pure locating its production facility in Tianjin (the impact on the business must be clearly stated)
  • ONE advantage and ONE disadvantage of the example business’ location (the impact on the business must be clearly stated).
(Answers will typically include relevant examples, business knowledge OR Māori business concepts.)
M6 / Candidate fully explains BOTH of:
  • ONE advantage and ONE disadvantage ofNZ Pure locating its production facility in Tianjin (the impact on the business must be clearly stated)
  • ONE advantage and ONE disadvantage of the example business’ location (the impact on the business must be clearly stated).
(Answers will typically include relevant examples, business knowledge OR Māori business concepts.)
Excellence / E7 / Candidate describes the business and business location
AND
fully explains ONE advantage AND ONE disadvantage of the location choice
AND
gives a conclusion that justifies the most important factor in the location decision.
(Answers will typically integrate relevant examples, business knowledge OR Māori business concepts into explanations.)
E8 / Candidate describes the business and business location
AND
fully explains TWO advantages AND ONE disadvantage of the location choice
AND
gives a conclusion that justifies the most important factor in the location decision.
(Answers will typically integrate relevant examples, business knowledge OR Māori business concepts into explanations.)
Three / Expected Coverage
(a) / The payback period shows how long it will take a firm to repay the original capital cost of an investment. This allows firms to choose an investment that will repay itself and create profit quicker.
The average / accounting rate of return gives the average percentage return on an investment over its life. This allows the firm to compare different investment option returns with other rates of return such as bank interest.
(b) / TWO further issues to take into account include:
  • Corporate objectives – does the investment meet corporate objectives of NZ Pure? A long-term profit goal may allow investments with long payback-periods, but if they are facing a cash-flow crisis they may prefer shorter payback period.
  • Human factors – the opinions of managers and staff, the need for staff training, and the effect on workplace culture may all be considered.
  • Risk – is NZ Pure willing to take risks? Is the benefit worth the risks?
  • Operations – current production capacity? Will quality standard be maintained? Links and relationship with suppliers?
  • State of economy – the current and forecast state of the Chinese economy will have a significant effect in investment decisions.

(c) / (See Appendix One)
The payback period is longer than the anticipated figure – this will affect cash flow in the longer term.
The average rate of return is above the desired percentage – this means that this investment will be more profitable than what the firm normally expects.
Conclusions:
The firm should go ahead with the investment because it is expected that moving into a new country will take a great deal longer to become profitable. But the profits will be higher than expected.
The firm should not go ahead with the investment because even though profits are higher than expected, the returns will take a longer time and this will reduce their value.
Not Achieved / NØ / No response; no relevant evidence.
N1 / Candidate gives insufficient breadth by explaining ONE of:
  • the payback period
  • the average / accounting rate of return
  • a further issue to take into account when making investment decisions
  • the difference between the calculated payback length of time and those anticipated by management
  • the difference between the calculated ARR percentage and those anticipated by management.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
N2 / Candidate gives insufficient breadth by explaining TWO of:
  • the payback period
  • the average / accounting rate of return
  • a further issue to take into account when making investment decisions
  • the difference between the calculated payback length of time and those anticipated by management
  • the difference between the calculated ARR percentage and those anticipated by management.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
Achievement / A3 / Candidate explains THREE of:
  • the payback period
  • the average / accounting rate of return
  • a further issue to take into account when making investment decisions
  • the difference between the calculated payback length of time and those anticipated by management
  • the difference between the calculated ARR percentage and those anticipated by management.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
A4 / Candidate explains FOUR of:
  • the payback period
  • the average / accounting rate of return
  • a further issue to take into account when making investment decisions
  • the difference between the calculated payback length of time and those anticipated by management
  • the difference between the calculated ARR percentage and those anticipated by management.
(Answers will typically state relevant examples, business knowledge OR Māori business concepts.)
Merit / M5 / Candidate fully explains ONE of:
  • a further issue to take into account when making investment decisions
  • the difference between the calculated payback length of time and those anticipated by management
  • the difference between the calculated ARR percentage and those anticipated by management.
(Answers will typically include relevant examples, business knowledge OR Māori business concepts.)