A-Level Business: People and Operations

This is the half of A-Level Business where a strategy either works or does not, because it is the half with people and machines in it. It also contains two calculations that look trivial and are routinely lost.

Labour turnover is leavers over the average workforce. Eighteen out of one hundred and twenty is fifteen per cent; the same two numbers written the other way up give six hundred and sixty-six per cent, and that figure is one of the options here, because writing a ratio upside down is what actually goes wrong under time pressure. Labour productivity gets the opposite treatment: the sum is easy and the question is what the answer means. Forty staff and four thousand eight hundred units is a hundred and twenty each, and a rise in that number next month could be a new machine, a longer shift, or quality standards quietly slipping — so it does not on its own show that anybody is working harder.

Two questions are about motivation used as an argument rather than dropped in as a name. A garment firm moves to a piece rate, output rises and defects rise with it, which is the limit of paying for quantity stated as an outcome rather than as an objection. And a software company spends heavily on the canteen and the car park and finds nobody works any harder — where the point is not that the spending was too small but that it was aimed at the kind of thing Herzberg says removes dissatisfaction without ever producing effort.

Structure is treated as a set of consequences. Delayering a tall hierarchy widens spans of control, shortens the chain a message travels, and lands more people on each remaining manager — and the option saying it costs nothing is there because that is the answer students write. A chain of forty stores in genuinely different regions gains local responsiveness by pushing decisions down, and pays for it in buying power and in the ability to run one national promotion.

Operations closes with three trade-offs. Building quality checks into every stage rather than inspecting at the end saves the work already done on a unit that is about to be scrapped — not, as one option has it, by hiring more inspectors. A firm whose unit costs fell for a decade and are now rising while it keeps growing is meeting diseconomies of scale, and the cause named is internal, coordination and communication, rather than the market. And a firm holding almost no stock had three good years and has just lost eleven days to a single supplier: both halves are true at once, and the answer has to hold them together instead of declaring just-in-time either a mistake or obviously right.

Every firm, product and person described is invented. No real company is named and no statistic is attributed to anyone. Nothing is reproduced from any exam board specification, past paper or mark scheme.

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• Calculate labour turnover the right way up and say what it costs a firm
• Read a labour productivity figure without assuming it measures effort
• Use a piece rate case to state the limits of paying for quantity
• Apply Herzberg's hygiene-motivator distinction to spending that changed nothing
• Say what delayering does to spans of control and to the managers who remain
• Weigh decentralisation against the buying power and consistency it costs
• Distinguish quality built in from quality inspected, and name where the saving comes from
• Judge just-in-time from both ends: the savings taken and the buffer given up

Ten invented cases: eighteen leavers out of one hundred and twenty with the inverted fraction offered alongside, four thousand eight hundred units from forty staff, a piece rate that raises output and defects together, a canteen and a car park that changed nothing, a tall hierarchy proposed for delayering, forty stores in different regions, a car plant moving quality upstream, a decade of falling unit costs that has turned, a choice between a machine and more staff under volatile demand, and three years of just-in-time savings against eleven idle days. Twelve flashcards carry the vocabulary — turnover, productivity, piece rate, hygiene factors, motivators, span of control, delayering, centralisation, total quality management, just-in-time, economies and diseconomies of scale.