Business Studies Grade 12 Western Cape Mock 2020 Memo

Downloaded from hlayiso.com GRADE 12 TRIAL EXAMINATION BUSINESS STUDIES INTER DISTRICT PAPER 1 MEMORANDUM 07 OCTOBER 2020 MARKS: 150 TIME: 2 HOURS This question paper consists of 8 pages.

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 NOTES TO MARKERS PREAMBLE The notes to markers are provided for quality assurance purposes to ensure the following: (a) Fairness, consistency and reliability in the standard of marking (b) Facilitate the moderation of candidates' scripts at the different levels (c) Streamline the marking process considering the broad spectrum of markers across the country (d) Implement appropriate measures in the teaching, learning and assessment of the subject at schools/institutions of learning 1. For marking and moderation purposes, the following colours are recommended: Marker: Red Senior Marker: Green Deputy Chief Marker: Brown Chief Marker: Pink Internal Moderator: Orange DBE Moderator: Turquoise 2. Candidates' responses must be in full sentences for SECTIONS B and C. However, this would depend on the nature of the question. 3. A comprehensive marking guideline has been provided but this is by no means exhaustive. Due consideration should be given to an answer that is correct but: • Uses a different expression from that which appears in the marking guideline • Comes from another credible source • Original • A different approach is used NOTE: There is only ONE correct answer in SECTION A. 4. Take note of other relevant answers provided by candidates and allocate marks accordingly. (In cases where the answer is unclear or indicates some understanding, part-marks should be awarded, for example, one mark instead of the maximum of two marks.) 5. The word 'Submax' is used to facilitate the allocation of marks within a question or sub-question. 6. The purpose of circling marks (guided by 'max' in the breakdown of marks) on the right-hand side is to ensure consistency and accuracy in the marking of scripts as well as for calculation and moderation purposes. 7. Subtotals to questions must be written in the right-hand margin. Circle the subtotals as indicated by the allocation of marks. This must be guided by 'max' in the marking guidelines. Only the total for each question should appear in the left-hand margin next to the appropriate question number. 8. In an indirect question, the theory as well as the response must be relevant and related to the question. 2 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 9. Correct numbering of answers to questions or sub-questions is recommended in SECTIONS A and B. However, if the numbering is incorrect, follow the sequence of the candidates' responses. Candidates will be penalised if the latter is not clear. 10. No additional credit must be given for repetition of facts. Indicate with an 'R'. 11. The differentiation between 'evaluate' and 'critically evaluate' can be explained as follows: 11.1 When 'evaluate' is used, candidates are expected to respond in either a positive/negative manner or take a neutral (positive and negative) stance, e.g. Positive: 'COIDA eliminates time and costs spent✓ on lengthy civil court proceedings.'✓ 11.2 When 'critically evaluate' is used, candidates are expected to respond in either a positive/negative manner or take a neutral (positive and negative) stance. In this instance candidates are also expected to support their responses with more depth, e.g. 'COIDA eliminates time and costs spent✓ on lengthy civil court proceedings✓, because the employer will not be liable for compensation to the employee for injuries sustained during working hours as long as it can be proved that the business was not negligent.'✓ NOTE: 1. The above could apply to 'analyse' as well. 2. Note the placing of the tick (✓) in the allocation of marks. 12. The allocation of marks must be informed by the nature of the question, cognitive verb used, mark allocation in the marking guideline and the context of each question. Cognitive verbs, such as: 12.1 Advise, name, state, mention, outline, motivate, recommend, suggest, (list not exhaustive) do not usually require much depth in candidates' responses. Therefore, the mark allocation for each statement/answer appears at the end. 12.2 Define, describe, explain, discuss, elaborate, distinguish, differentiate, compare, tabulate, justify, analyse, evaluate, critically evaluate (list not exhaustive) require a greater depth of understanding, application and reasoning. Therefore, the marks must be allocated more objectively to ensure that assessing is conducted according to established norms so that uniformity, consistency and fairness are achieved. 13. Mark only the FIRST answer where candidates offer more than one answer for SECTION B and C questions that require one answer. 3 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 14. SECTION B 14.1 If, for example, FIVE facts are required, mark the candidate's FIRST FIVE responses and ignore the rest of the responses. Indicate by drawing a line across the unmarked portion or use the word 'Cancel'. NOTE: This applies only to questions where the number of facts is specified. 14.2 If two facts are written in one sentence, award the candidate FULL credit. Point 14.1 above still applies. 14.3 If candidates are required to provide their own examples/views, brainstorm this at the marking centre to finalise alternative answers. 14.4 Use of the cognitive verbs and allocation of marks: 14.4.1 If the number of facts are specified, questions that require candidates to 'describe/discuss/explain' may be marked as follows: • Fact 2 marks (or as indicated in the marking guidelines) • Explanation 1 mark (two marks will be allocated in Section C) The 'fact' and 'explanation' are given separately in the marking guideline to facilitate mark allocation. 14.4.2 If the number of facts required is not specified, the allocation of marks must be informed by the nature of the question and the maximum mark allocated in the marking guideline. 14.5 ONE mark may be awarded for answers that are easy to recall, requires one word answers or is quoted directly from a scenario/case study. This applies to SECTIONS B and C in particular (where applicable). 15. SECTION C 15.1 The breakdown of the mark allocation for the essays is as follows: Introduction Content Maximum: Conclusion 32 Insight 8 TOTAL 40 4 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 15.2 Insight consists of the following components: Layout/Structure Is there an introduction, a body, and a conclusion? 2 Analysis and Is the candidate able to break down the question into 2 interpretation headings/subheadings/interpret it correctly to show understanding of what is being asked? Marks to be allocated using this guide: All headings addressed: 1 (One 'A') Interpretation (16 to 32 marks): 1 (One 'A') Synthesis Are there relevant decisions/facts/responses made based 2 on the questions? Marks to be allocated using this guide: No relevant facts: 0 (Two '-S') Some relevant facts: 1 (One '-S') Only relevant facts: 2 (No '-S') Option 1: Where a candidate answers 50% or more of the question with only relevant facts; no '-S' appears in the left margin. Award the maximum of TWO (2) marks for synthesis. Option 2: Where a candidate answers less than 50% of the question with only OR some relevant facts; one '-S' appears in the left margin. Award a maximum of ONE (1) mark for synthesis. Option 3: Where a candidate answers less than 50% of the question with no relevant facts; two '-S' appear in the left margin. Award a ZERO mark for synthesis. Originality Is there evidence of examples based on recent information, 2 current trends and developments? TOTAL FOR INSIGHT: 8 TOTAL MARKS FOR FACTS: 32 TOTAL MARKS FOR ESSAY (8 + 32): 40 NOTE: 1. No marks will be awarded for contents repeated from the introduction and conclusion. 2. The candidate forfeits marks for layout if the words INTRODUCTION and CONCLUSION are not stated. 3. No marks will be awarded for layout, if the headings INTRODUCTION and CONCLUSION are not supported by an explanation. 15.3 Indicate insight in the left-hand margin with a symbol e.g. ('L, A, -S and/or O'). 15.4 The breakdown of marks is indicated at the end of the suggested answer/ marking guideline to each question. 5 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 15.5 Mark all relevant facts until the SUBMAX/MAX mark in a subsection has been attained. Write SUBMAX/MAX after maximum marks have been obtained, but continue reading for originality 'O'. 15.6 At the end of each essay indicate the allocation of marks for facts and marks for insight as follows: (L – Layout, A – Analysis, S – Synthesis, O – Originality) as in the table below. CONTENT MARKS Facts 32 (max.) L 2 A 2 S 2 O 2 TOTAL 40 15.7 When awarding marks for facts, take note of the submaximum indicated, especially if candidates do not use the same subheadings. Remember, headings and subheadings are encouraged and contribute to insight (structuring/logical flow/sequencing) and indicate clarity of thought. (See MARK BREAKDOWN at the end of each question.) 15.8 If the candidate identifies/interprets the question INCORRECTLY, then he/she may still obtain marks for layout. 15.9 If a different approach is used by candidates, ensure that the answers are assessed according to the mark allocation/subheadings as indicated in the marking guideline. 15.10 15.10.1 Award TWO marks for complete sentences. Award ONE mark for phrases, incomplete sentences and vague answers. 15.10.2 With effect from November 2015, the TWO marks will not necessarily appear at the end of each completed sentence. The ticks (✓) will be separated and indicated next to each fact, e.g. 'Product development is a growth strategy ✓, where businesses aim to introduce new products into existing markets.'✓ This will be informed by the nature and context of the question, as well as the cognitive verb used. 15.11 With effect from November 2017, the maximum of TWO (2) marks for facts shown as headings in the marking guidelines, will not necessarily apply to each question. This would also depend on the nature of the question. 6 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 SECTION A (COMPULSORY) QUESTION 1 1.1.1 C ✓✓ 1.1.2 C✓✓ 1.1.3 B✓✓ 1.1.4 D✓✓ 1.1.5 A✓✓ (5 x 2) (10) 1.2.1 Employment Equity Act✓✓ 1.2.2 Divestiture✓✓ 1.2.3 Backward✓✓ 1.2.4 Placement✓✓ 1.2.5 Piece meal✓✓ (5 x 2) (10) 1.3.1 B✓✓ 1.3.2 D✓✓ 1.3.3 J✓✓ 1.3.4 G✓✓ 1.3.5 F✓✓ (5 x 2) (10) TOTAL SECTION A: 30 SECTION B Mark the FIRST TWO answers only QUESTION 2: BUSINESS ENVIRONMENTS 2.1 Pillars of BBBEE Option 1 - Ownership✓ - Management✓ - Employment Equity✓ - Skills development✓ - Enterprise development ✓ - Supplier development/Preferential procurement✓ - Socio economic development/Corporate social investment✓ OR Option 2 - Ownership✓ - Management control✓ - Skills development✓ - Enterprise and supplier development✓ - Socio economic development✓ NOTE: Mark the first THREE (3) only (3 x 1) (3) 7 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 2.2 Legislation 2.2.1 Skills Development Act, 1998 (Act 97 of 1998)/Skills Development Act/SDA✓ (1) 2.2.2 Actions regarded as discriminatory by the Skill Development Act - '… only young employees are given the opportunity to learn new skills.'✓ - 'Female employees are excluded from attending training.'✓ NOTE: Only allocate marks for responses that are quoted from scenario. (2 x 1) (2) 2.2.3 Positive impact of the Skills Development Act (SDA) on Tropical Manufacturers/businesses - Tropical Manufacturers (TM) may have an increased number of skilled employees✓ in skills that are scarce.✓ - Improves productivity✓ in the workplace.✓ - TM may be globally✓ more competitive.✓ - Higher investment in education and training in the labour market✓ increases profits/return on investment.✓ - TM's focus on social investment✓ may be redirected to other challenges.✓ - Employees' quality of life may improve✓ as they will be more employable/ promoted to senior/managerial positions.✓ - Improves work prospects✓ and labour mobility.✓ - Self-employment✓ and entrepreneurship are promoted.✓ - On-going skills development, learning and the acquisition of new skills are encouraged✓ to sustain the improvement of skills development.✓ - Any other relevant answer related to the positive impact of the SDA on Tropical Manufacturers/businesses. Max (6) 2.3 BCEA provisions from the statements 2.3.1 Termination of employment✓✓ 2.3.2 Overtime✓✓ 2.3.3 Sick leave✓✓ 2.3.4 Prohibition of Child- and Forced labour✓✓ (8) 2.4 SWOT analysis STRENGTHS WEAKNESSES - specialises in transforming ordinary cars - The business does not a have a good into superfast cars✓ cash recording system. ✓ - many customers✓ - excellent service✓ - easy to start business with a small Sub max (1) amount of capital✓ Sub max (1) OPPORTUNITY THREATS - TC has opened a new branch in - increased the interest rates✓ Bellville. ✓ - difficult for TC to obtain a loan at a Sub max (1) favourable rate. ✓ Sub max (1) NOTE: Do no award marks for responses that are not from the scenario. Max (4) 8 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 2.5 Consumer rights 2.5.1 Right to return goods/have goods replaced/claim a refund/fair value/good quality and safe products✓✓ 2.5.2 Right to privacy/confidentiality✓✓ 2.5.3 Right to fair/honest dealings/responsible marketing/promotion✓✓ 2.5.4 Right to accountability from suppliers✓✓ (4 x 2) (8) 2.6 Recommendations for compliance with the Employment Equity Act (EEA) - Guard against discriminatory appointments.✓✓ - Assess the racial composition of all employees, including senior management.✓✓ - Ensure that there is equal representation of all racial groups in every level of employment.✓✓ - Promote equal opportunities and fair treatment.✓✓ - Clearly define the appointment process, so that all parties are well informed.✓✓ - Use certified psychometric tests to assess applicants/employees to ensure that suitable candidates are appointed.✓✓ - Ensure that diversity/inclusivity in the workplace is achieved.✓✓ - Implement affirmative action measures to redress disadvantages experienced by designated groups.✓✓ - Prepare an employment equity plan in consultation with employees.✓✓ - Implement an employment equity plan.✓✓ - Submit the employment equity plan to the Department of Labour.✓✓ - Assign one or more senior managers to ensure implementation and monitoring of the employment equity plan.✓✓ - Eliminate barriers that have an adverse impact on designated groups.✓✓ - Accommodate people from different designated groups.✓✓ - Retain/Develop/Train designated groups, including skills development.✓✓ - Regularly report to the Department of Labour on progress in implementing the plan.✓✓ - Any other relevant answer related to ways in which businesses could comply with EEA. Max (8) [40] QUESTION 3: BUSINESS OPERATIONS 3.1 Examples of fringe benefits in the workplace - Medical Fund / Health Insurance Fund✓ - Pension fund✓ - Provident fund✓ - Funeral benefits✓ - Car / Travel / Housing / Cellphone / Clothing allowance✓ - Performance-based incentives✓ - Issuing of bonus shares✓ - Staff discount / Free or low cost meal / Canteen facilities✓ NOTE: Mark only the first FOUR (4). (4 x 1) (4) 9 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 3.2.1 Meaning of Induction - New employees must be familiarised✓ with their new physical work environment / - organizational culture / products and services. ✓ - Employees must be informed ✓ about the processes / procedures of the business. ✓ - They must have basic knowledge✓ of what is expected in the job✓ / Understand his role✓ and responsibilities in his new job. ✓ - Ensure that employees are well acquainted✓ with the business safety regulations and rules. ✓ - Any other relevant answer related to the meaning of induction. Max (2) 3.2.2 Benefits of induction - Allow new employees to settle down✓ and work effectively. ✓ - Ensure that new employees know rules and restrictions ✓in the business. ✓ - New employees can establish relationships with fellow employees✓ at different levels✓ - Make new employees comfortably in the workplace✓, which reduces anxiety / uncertainty / fear. ✓ - The results obtained during the induction process ✓ provide a basis for focused training. ✓ - Any other relevant answer related to the the benefits of induction. Max (6) 3.3 Distinguish between job description and job specification. JOB DESCRIPTION JOB SPECIFICTION - Describes duties / responsibilities✓ of a - Specifies the minimum acceptable specific work / summary of the nature / type of personal characteristics / skills / work. ✓ qualifications✓ required for the job. ✓ - Written description✓ of the job and its - Written description of specific requirements✓ qualifications / skills / experience✓ required for the job. ✓ - Write key performance areas / tasks for a - Write down key requirements of the specific job, ✓ bv. Job title / Working person who will fill the position, ✓ e.g. conditions / Relationship of the job with other formal qualifications / willingness to jobs in the business, etc. ✓ travel / work unusual hours, etc. ✓ Sub max (4) Sub max (4) NOTE: 1. The answer does not have to be in tabular format, but the distinction must be clear. 2. Award a maximum of FOUR (4) marks if the distinction is not clear/ Mark job description or job specification only. Max (8) 10 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 3.4 Link between salary provision and the BCEA - The BCEA sets conditions✓ that ensure fair labor and human resources practices. ✓ - According to the BCEA, businesses can use different compensation methods✓ to pay their employees. ✓ - Payment of salaries must be based on whether the employee is permanently✓ or employed on a fixed-term contract. ✓ - Businesses are supposed to deduct income tax (PAYE) ✓ from employees' taxable salaries. ✓ - BCEA describes legislation, ✓such as the employment contract, which can affect salary determination. ✓ - Any other relevant answer related to the link between salaray provision and the BCEA. Max (6) 3.5 3.5.1 Identify the business functions A. Purchasing function✓✓ (2) B. Production function✓✓ (2) 3.5.2 Explain how the quality of performance of the human resource function can contribute to the success or failure of AC. (Read the context of the answer) - Make sure there is a good recruitment policy✓ that attracts the best candidates. ✓ - Ensure fair ✓and fair selection process✓ - Fair compensation packages ✓ that are in line with the industry. ✓ - Give performance incentives to staff ✓to increase productivity. ✓ - Good relationship ✓with employees. ✓ - Low percentage of staff turnover✓ in the business✓ - Any other relevant answer related to the quality of performance of the human resource function. Max (2) 3.5.3 Explain why AC can use quality circles - Solve problems✓ related to quality and implementation of improvements. ✓ - Investigate problems✓ and suggest solutions for management. ✓ - Ensure that there is no duplication ✓of activities / tasks in the workplace. ✓ - Make suggestions ✓for the improvement of systems and processes in the workplace. ✓ - Improve the quality of products / services / productivity✓ through regular review of quality processes. ✓ - Initiate / strengthen strategies ✓to improve the good running of business activities.✓ - Less cost of dismissal✓ in the long run. ✓ - Increase ✓employees' morale / motivation. ✓ - Any other relevant answer related to the use of quality circles. Max (4) 11 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 3.6 Ways in which TQM can have an impact on reducing the cost of quality. - Quality circles known for discussing ways to improve the quality of work / craftsmanship. ✓✓ - Schedule activities to eliminate duplication of tasks. ✓✓ - Share responsibility for quality output among management and workers. ✓✓ - Train employees at all levels so that everyone understands their role in quality management. ✓✓ - Develop work systems that empower employees to find new ways to improve quality. ✓✓ - Work closely with suppliers to improve the quality of raw materials / inputs. ✓✓ - Improve communication on quality challenges / deviations so that everyone can learn from experience. ✓✓ - Reduce investment in expensive but inefficient inspection procedures in the production process. ✓✓ - Any other relevant answer related to the impact on reducing the cost of quality. Max (4) [40] QUESTION 4: MISCELLANEOUS TOPICS BUSINESS ENVIRONMENTS 4.1 Types of diversification strategies. - Concentric✓ - Horizontal✓ - Conglomerate✓ NOTE: Mark the first TWO (2) only (2 x 1) (2) 4.2 COIDA 4.2.1 Compensation for Occupational Injuries and Diseases Act, 1997 (Act 61 of 1997)/ Compensation for Occupational Injuries and Diseases Act, 1993 (Act 130 of 1993)/ Compensation for Occupational Injuries and Diseases Act/COIDA.✓✓ (2) Motivation: An employee of Locum Incorporated sustained injury while performing duties / Management is refusing to submit the claim to the Compensation fund / They did not register the employee with the Commissioner of the Compensation Fund.✓ (1) NOTE: Do not award marks for the motivation if the Act was identified incorrectly. Max (3) 4.2.2 Penalties for non-compliance - Locum Incorporated can be fined✓ for refusing to lodge the claim/contravening the Act.✓ - LI can be forced to make large payments✓ if it did not take the necessary precautions according to the Act.✓ - LI can be forced to pay any recovery costs✓ required by the Compensation Fund.✓ 12 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 - The employee may take LI to court✓ for not registering him/her with the Commissioner of the Compensation Fund.✓ - If LI is found guilty of any misconduct✓, they will have to pay large penalties/face imprisonment.✓ - Any other relevant answer related to penalties for non-compliance with COIDA. Max (6) 4.3 Extent of control of Business Environments BUSINESS ENVIRONMENTS EXTENT OF CONTROL 4.3.1 Micro✓✓ Full control✓ 4.3.2 Market✓✓ Little/Limited/No control but can influence✓ 4.3.3 Macro✓✓ No control✓ Sub max (6) Sub max (3) NOTE: 1. The answer does not have to be in tabular format. 2. Mark the first THREE (3) business environments only. 3. The extent of control must be linked to the business environment. 4. Do not award marks for the extent of control if the business environment is not mentioned. Max (9) BUSINESS OPERATIONS 4.4 Legal requirements of the employment contract. - Employment contract is an agreement between the employer and the employee✓ and is legally binding. ✓ - Employer and employee must agree ✓to any changes to the contract. ✓ - Aspects of the employment contract can be renegotiated ✓during the course of employment. ✓ - No party may unilaterally change aspects ✓of the employment contract. ✓ - The employer and employee ✓must both sign the contract. ✓ - The employment contract should include a code of conduct ✓ and code of ethics.✓ - The employer must explain the terms and conditions of the employment contract ✓ to the employee. ✓ - It may not contain any requirements that are in conflict ✓with the BCEA. ✓ - Conditions of employment/duties/responsibilities of the employees ✓must be stipulated clearly. ✓ - The remuneration package/including benefits ✓must be clearly indicated. ✓ - All business policies, procedures and disciplinary codes/rules ✓can form part of the employment contract. ✓ - The employer must allow the employee to thoroughly read through the contract✓ before it is signed. ✓ - Any other relevant answer related to legal requirements of the employment contract (4) 13 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 4.5 Advantages of a good quality management system - Deficient customer service is delivered, which leads to increased customer satisfaction. ✓✓ - Time and resources is used efficiently. ✓✓ - Increase productivity through proper time management / use of high-quality resources. ✓✓ - Products / services are constantly being improved, which leads to increased levels of customer satisfaction. ✓✓ - Vision / Mission / Business objectives can be achieved. ✓✓ - Business has a competitive advantage over its competitors. ✓✓ - Regular training will continuously improve the quality of employees' skills / knowledge. ✓✓ Max (6) 4.6 Importance of the public relations function - Quickly respond to negative publicity / less / little / no incidents of negative publicity. ✓✓ - Providing regular / positive press releases. ✓✓ - Implement sustainable Corporate Social Investment (CSI) programs. ✓✓ - Positive results of / Positive feedback from public surveys on business image. ✓✓ - High standard of internal publicity / appearance of buildings / - professional telephone etiquette, etc. ✓✓ - Provide quality goods / services that promote the brand / image with key stakeholders / customers / suppliers / government / service providers. ✓✓ Max (6) 4.7 Difference between Quality Control and Quality Assurance Quality Control Quality Assurance - Inspection of the final product✓ to - Performed during and after production make sure it meets the required process ✓ to ensure that required standard. ✓ standards are met with each step in the processes. ✓ - Includes the setting of targets/ - Ensure that each process is aimed at measuring performance✓ and taking getting the product right the first time ✓ corrective measures. ✓ and prevent errors from happening - again. ✓ - Control of raw materials/employees / - The “build-in” of quality✓ as opposed machines / workmanship / to “checking for ”quality. ✓ products✓ to ensure that high standards are maintained. ✓ Sub max (2) Sub max (2) NOTE: 1. The answer does not have to be in tabular format, but the differences must be clear. Max (4) [40] TOTAL SECTION B: 80 14 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 SECTION C Mark only the FIRST question. QUESTION 5: BUSINESS ENVIRONMENTS (BUSINESS STRATEGIES) 5.1 Introduction - A strategy is course of action that the business follows to achieve its purpose/ objectives. ✓ - The strategic management process is defined as the way an organisation defines its strategy. ✓ - The strategic management process enables managers to make choice of a set of strategies that will enable the business to achieve better performance. ✓ - PESTLE analysis is used to identify and evaluate the factors in the external environment that can influence the business. ✓ - PESTLE analysis enables to businesses to have a better understanding of the external environment and the industry in which it competes. ✓ - A business strategy must be evaluated in each stage of operation to measure performance. ✓ - Any other relevant introduction related to applying the PESTLE analysis to identify macro environmental challenges and develop strategies. (2x1) (2) 5.2 Strategic management process - Have a clear vision, a mission statement and measurable/realistic objectives in place. ✓✓ - Identify opportunities/weaknesses/strengths/threats by conducting environ-mental scanning/situational analysis. ✓✓ - Tools available for environmental scanning may include a SWOT analysis/Porter's Five Forces model/PESTLE analysis/industrial analysis tools. ✓✓ - Formulate alternative strategies to respond to the challenges. (This involves different types of business strategies) ✓✓ - Develop (an) action plan(s), including the tasks to be done/deadlines to be met/resources to be procured, etc. ✓✓ - Implement selected strategies by communicating it to all stakeholders/organising the business's resources/motivating staff. ✓✓ - Continuously evaluate/monitor/measure strategies in order to take corrective action. ✓✓ NOTE: 1. The initial process may be in any order. 2. Mark the first TWO (2) only. Max (4) 15 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 PESTLE analysis FACTORS 5.3 5.4 CHALLENGES RECOMMENDATIONS Political✓ - Khanyisa Traders will have to - Research recent government consider specific government policies regarding trading under policies✓ e.g. under which lockdown levels✓✓ level of lockdown will KT be allowed to trade?✓ - Consumer rights organisations - Network and lobby with the may prevent KT from selling NGOs and all consumer rights products✓ if they do not meet organisations.✓✓ certain requirements.✓ - Trade agreements may - Trade only with countries that have favourable trade agree- prevent KT✓ from importing ments with the government.✓✓ some products.✓ - Any other relevant - Any other relevant challenge recommendation related to related to political factors. political factors. Sub max (2) Sub max (4) Economic✓ - Inflation/Interest rates may - Consider decreasing profit negatively impact on KT’s margins rather than increasing business✓, e.g. will KT’s product prices.✓✓ clients still afford the products if prices increases due to inflation?✓ - Loans may be expensive✓ due - Borrow money from financial Institutions when interest rates to high interest rates.✓ are favourable.✓✓ - Fluctuations in foreign - Consider exchange rates when currency✓ may restrict trading with other countries.✓✓ imports.✓ - Provide essential services to - KT may not qualify✓ for certain qualify for tax rebates/ tax exemptions/subsidies.✓ subsidies.✓✓ - Any other relevant - Any other relevant challenge recommendations related to related to economic factors. economic factors. Sub max (2) Sub max (4) Social✓ - Customers may not be able to - Sell cheaper products at lower Afford products✓ due to low prices.✓✓ income levels.✓ - Some customers may prefer to - Co-operate with traditional use the services of traditional dressmakers to learn dressmakers✓, instead of more about traditional modern/Western clothing✓ garments.✓✓ - May not be conversant✓ with - Learn local languages✓✓/Hire the local language of her employees who are well conversant with the local customers.✓ - Any other relevant challenge language.✓✓ 16 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 related to social factors. - Any other relevant Sub max (4) recommendations related to social factors. Sub max (2) Technological✓ - May not keep up with/be aware - Continuous research on the of✓ the latest technology/ latest available technology/ equipment ✓ equipment in the market.✓✓ - Employees may not be - KT should train existing/appoint skilled✓ new employees to maintain/use To operate/maintain new new equipment.✓✓ technology/equipment.✓ - Compare prices/Select suitable suppliers for new equipment at - KT may not be able to afford✓ reasonable prices.✓✓ new technology.✓ - Ensure that her business is geared for online trading / - May not be able to cater for/ e-commerce.✓✓ afford✓ online transactions / - Any other relevant e-commerce.✓ recommendations related to - Any other relevant challenge technological factors. Sub max (2) related to technological factors. Sub max (4) Legal✓ - Consider certain Acts✓ that - Comply with all relevant may have a direct impact on legislation that may impact on the KT, e.g. the CPA/BCEA✓ etc. business. ✓✓ - Legal requirements for - Comply with the legal operating ✓ may be requirements for operating a business, e.g. licence/trade complicated/time-consuming.✓ - High legal costs involved in mark registration/patents. ✓✓ obtaining a licence/trade - Budget for high legal mark/patent✓ may prevent KT establishment costs. ✓✓ from establishing the business.✓ - KT must know the legalities of - Legalities of business business contracts to comply with contracts✓ may limit business all the requirements.✓✓ operations.✓ - Any other relevant - Any other relevant challenge recommendation related to legal related to legal factors. factors. Sub max (2) Sub max (4) Environmental✓ - Chemicals in the products✓ - Chemicals/Ingredients should be may be harmful to clearly indicated on labels / customers.✓ packaging to inform customers about possible side effects / - Measures to dispose of correct use of products. ✓✓ waste✓ - Implement cost effective may be expensive.✓ measures to dispose ofwaste.✓✓ - Packaging of some products✓ - Implement recycling measures to prevent pollution of the may not be environmentally environment/Use packaging friendly/may not be that is re-usable/recyclable.✓✓ recyclable.✓ 17 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 - Any other relevant challenge - Any other relevant related to environmental recommendations related to factors. environmental factors. Sub max (4) Sub max (2) NOTE: Each strategy must be linked to the identified challenge. Factors: Max (6) Challenges: Max (16) Recommendation: Max (10) 5.5 Steps in evaluating strategies - Examine the underlying basis ✓of a business strategy.✓ - Formulate strategies✓ to meet objectives favourably.✓ - Implement strategies✓ using action plans✓, etc. - Look forward and backwards✓ into the implementation process.✓ - Compare the expected performance ✓with the actual performance.✓ - Measure business performance ✓in order to determine the reasons for deviations and analyse these reasons.✓ - Take corrective action ✓so that deviations may be corrected.✓ - Set specific dates ✓for control and follow up.✓ - Draw up a table ✓of the advantages and disadvantages of a strategy.✓ - Decide on✓ the desired outcome.✓ - Consider the impact of the strategic implementation✓ in the internal and external environments of the business.✓ - Any other relevant answer related to the steps in strategy evaluation. NOTE: Accept steps in any order. Max (10) 5.6 Conclusion - Businesses have to analyse the opportunities and threats in order to formulate new strategies or change their current strategies.✓✓ - PESTLE analysis enables businesses to identify the challenges of the external environment and devise relevant strategies to overcome the identified challenges.✓✓ - Businesses that apply the PESTLE analysis are able to respond quickly to the external pressures and adapt to them.✓✓ - Any other relevant conclusion related to applying the PESTLE analysis/ recommendation of strategies/steps in evaluating strategies. Max (2) [40] 18 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 QUESTION 5: BREAKDOWN OF MARK ALLOCATION DETAILS MAXIMUM TOTAL Introduction 2 Initial stages of the strategic 4 management process PESTLE Factors 6 Challenges 16 Max Recommendation 10 32 Steps in evaluating strategies 10 Conclusion 2 INSIGHT Structure and layout 2 Analysis / Interpretation 2 8 Synthesis 2 Originality/Examples 2 TOTAL MARKS 40 LASO - for each component: Give 2 marks if all the requirements have been met. Give 1 mark if some requirements have been met. Give 0 marks where requirements have not been met at all. QUESTION 6: BUSINESS OPERATIONS (HUMAN RESOURCE FUNCTION AND QUALITY OF PERFORMANCE) 6.1 Introduction - Quality is the ability of a product / service to meet the needs of consumers✓ - The quality of Manufactured goods must be ensured throughout the production cycle.✓ - Quality management must not only be an inspection process, but must become part of the culture of the business.✓ - Total quality is related to products that meet consumers' needs and - expect things completely satisfied in every aspect on ʼn continuous basis.✓ - Any other relevant conclusion related to quality management / continuous improvement of processes and system / financial function and marketing function. Any (2x1) (2) 6.2 Meaning of quality management - The process of managing all activities✓ necessary to ensure that enterprise provides goods and services of constant high standard. ✓ - Refers to techniques / tools used✓ to design / improve the quality of a product. ✓ - Can be used for liability ✓ within each of the business functions✓ - Purpose is to ensure that the quality of goods / services is constant. / Focus on the means to achieve consistency Max (6) 19 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 6.3 Implications of the Skills Development Act of Human Resource Function - The human resource manager must interpret the objectives and requirements of the SDA✓ and adapt training application programs accordingly. ✓ - Identify the training needs of employees✓ and provide them with training opportunities so that they can perform their tasks efficiently. ✓ - Use the National Qualifications Framework / NQF to assess the ✓ skill levels of employees. ✓ - Interpret / Implement the objectives / requirements of the framework ✓for the National Skills Development Strategy. ✓ - Help managers to identify skills / training needs✓ to help them establish learnerships. ✓ Max (8) 6.4 Impact of elements on 6.4.1 Monitoring and evaluation of quality processes Positive / Benefits - Overcome product anomalies✓ and waste / complaints. ✓ - Good quality control / procedures ✓Replacement / breakdown of equipment / machinery on a regular basis. ✓ - Can be equipped✓ to get things right at the right time. ✓ - Improve performance✓ and maintain high quality standards. ✓ - Improve current and future management✓ of quality outputs / outcomes / impact.✓ - Provide a clear indication of quality aspects✓ that contribute to the achievement of goals / objectives. ✓ - Change interventions ✓which can improve the efficient use of resources. ✓ - Supports management to obtain information ✓what is needed to make informed decisions about processes. ✓ AND/OR Negative / Disadvantages - Big businesses are often divided✓ and the departments work in compartments. ✓ - It is difficult to communicate✓ with everyone. ✓ - It often takes longer to detect problems ✓or to respond to weaknesses✓ - It is not viable✓ to check the quality of all the products✓ Sub max (8) 6.4.2 Continuous Improvement of Processes and Systems Positive / Benefits - Big enterprises have more resources ✓to check quality performance in each unit.✓ - Sufficient capital resources are available ✓for new equipment needed for processes and systems. ✓ - Big businesses have a person who is dedicated ✓ to improving processes and systems. ✓ 20 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 - Willing to take risks / try new processes and systems ✓ because they can absorb the impact of losing money. ✓ - They can afford to use the services of the quality circles✓ to stay ahead of their competitors. ✓ AND/OR Negative / Disadvantages - Mass production ✓can complicate quality / quality control. ✓ - Systems and processes take time and effort ✓to implement in large businesses, as communication / purchasing in the process can slow it down. ✓ - Risks for changing parts of the business ✓which works really well. ✓ - Not all negative feedback from employees and customers will be accurate, ✓ which can lead to faulty / unnecessary changes to systems and processes. ✓ Sub max (8) 6.5 Contribution to success 6.5.1 Financial Function - Obtain capital from the most suitable / available / reliable sources. ✓✓ - Negotiate better interest rates to control financial costs. ✓✓ - Set budgets to ensure adequate use of monetary resources. ✓✓ - Hold financial records up to date to ensure timely / accurate tax payments. ✓✓ - Analyze strategies to increase profitability. ✓✓ - Invest surplus funds to create sources of passive income. ✓✓ - Implement financial controls / systems to prevent fraud. ✓✓ Sub max (8) 6.5.2 Marketing Function - Increase in their market share. ✓✓ - Win customers by satisfying their needs / building positive relationships. ✓✓ - Adherence to ethical advertising practices when promoting products / services.✓✓ - Identify a competitive advantage to focus / improve on marketing strengths. ✓✓ - Distinctive products to attract more customers. ✓✓ - Ongoing evaluation of value issues. ✓✓ - Effective communication with customers to get feedback on their experience of products sold / services rendered. ✓✓ - Coordinating distribution with production and advertising strategies. ✓✓ - Use pricing techniques to ensure a competitive advantage. ✓✓ Sub max (8) 6.6 Conclusion - Every business must have a quality management system that ensures that systems and processes are executed correctly and safely. ✓✓ - The business functions must always work together to ensure that the quality of products continuously improves .✓✓ - Any other relevant conclusion related to quality management / continuous improvement of processes and system / financial function and marketing function. 21 of 22

Downloaded from hlayiso.com BESIGHEIDSTUDIES/V1 MEMORANDUM 07 OKT 2020 Any (1 x 2) (2) [40] QUESTION 6: BREAKDOWN OF MARK DETAILS MAXIMUM TOTAL Introduction 2 Meaning of quality management 6 Implications of Skills Development Act 8 Impact of TQM elements on large businesses: o Monitoring and evaluation of quality processes o Continuous improvement of processes and 16 systems Max 32 Quality indicators of the financial and the marketing function 16 Conclusion 2 INSIGHT Structure and layout 2 8 Analysis / Interpretation 2 Synthesis 2 Originality/Examples 2 TOTAL MARKS 40 LASO - for each component: Give 2 marks if all the requirements have been met. Give 1 mark if some requirements have been met. Give 0 marks where requirements have not been met at all. TOTAL SECTION C: 40 GRAND TOTAL: 150 22 of 22