FF is a private limited company that provides packaged fruit to the industrial market (B2B). The farm grows a variety of different fruits including apples, bananas, and strawberries. The production process is labour intensive. FF employs 80 fruit pickers and uses piece rates as the method of payment (see Table 1.1). Table 1.1 Data about FF's fruit pickers' payment | Payment ($) | |---|---| | Apples (per box) | 2.00 | | Bananas (per box) | 1.50 | | Strawberries (per tray) | 3.00 | Motivation among the fruit pickers is poor. The fruit pickers' main concerns are: * poor induction for new employees * no encouragement of multi-skilling * an autocratic management style. The employees would like to introduce time-based payment at a rate of $4.50 per hour, to replace the piece rate payment. The food industry has recently been criticised for a lack of sustainability. In response, FF's directors plan to move from single-use plastic packaging to using recycled materials. This would require the purchase of new machinery to package the fruit. The machinery would make the packaging production more capital intensive. FF's directors are also considering growing fruits that require fewer chemicals and less water. However, this will require changes to FF's supply chain management.

Mark scheme

Marking points from the official mark scheme (Feb/Mar 2023). The mark or mark type is shown in brackets.

1. [1] Identify one content theory of motivation. Indicative content. Responses may include: Taylor / scientific management; Mayo / human needs / Hawthorne effect; Maslow / hierarchy of needs; Herzberg / 2 factors; McClelland / 3 needs. Accept all valid responses.
2. [1] AO1 Knowledge and understanding: The coordination (allow management) of the flow/movement of goods and services / raw materials.
3. [2] AO2 Application: Limited application applies knowledge of supply chain management from one aspect of the supply chain (i.e. suppliers to a business, within a business or from the business to customers). Developed application applies knowledge of supply chain management in two or more aspects of a business. Exemplars for application: Between suppliers and the business and the business to customers; Between different parts of the business – and to the customer; Raw materials within the business - and distribution channels; Involves the complete chain of inventory from suppliers or to customers; Involves inventories, such as raw materials – and finished goods.
4. [1] 1 mark for formula or correct calculation of total costs ($450)
5. [1] Piece rate: Apples - 5 boxes x $2 = $10; Bananas - 2 boxes x $1.50 = $3; Strawberries – 4 trays × $3 = $12; Total pay = $25 (1)
6. [1] Time based: 8 hours × $4.50 = $36 (1)
7. [1] Difference: $36 – $25 = $11 (1 OFR applies)
8. [3] Answer = ($)11 (3)
9. [1] AO1 Knowledge and understanding: Advantages of time-based payment method may include: improves flexibility; improves quality; easier to forecast cash flow / costs; produce more output; motivates employees.
10. [2] AO2 Application: Limited application applies knowledge to FF once. Developed application applies knowledge to FF twice. Exemplars for application: Higher payment to fruit pickers; Answer to Q1(b)(i) (OFR); FF already has poor motivation among its fruit pickers; Fruit pickers on piece rate may choose poor quality e.g., unripe/over-ripe fruit to fill boxes/trays; Different fruit may be more financially beneficial to fruit pickers on piece rate; $4.50 is only one flat payment. Accept all valid responses.
11. [2] AO1 Knowledge and understanding: Knowledge of non-financial motivators (max 2s), including: Induction training; On the job / off the job training; opportunities for promotion; development; status; job re-design; team working; empowerment; participation / different leadership / management style; job enrichment. Do not allow any financial motivators, including: time based, salary, piece rates, commission, bonuses, profit sharing, performance-related pay, fringe benefits, paid holiday, gifts etc.
12. [2] AO2 Application: Max one for application in the first non-financial motivator and max one for application in the second non-financial motivator. Application of knowledge of a non-financial motivator to FF (max 2 APPs), including: Fruit picking is labour intensive work; 80 fruit pickers currently employed who are paid using piece rate, but would like time based; Change to time-based would increase FF's costs significantly, 44% increase (based on OFR Q1(b)(i)); Poor induction; No encouragement of multi-skilling; Autocratic management style.
13. [4] AO3 Analysis: Limited analysis candidate shows one link in the chain of analysis. Developed analysis candidate shows two or more links in the chain of analysis or a two-sided analysis. Analysis may include: (Training) can improve the induction of employees and lead to greater efficiency greater sales, profit. (Development) could be used to encourage employees to move between different jobs which increases employee flexibility - increased efficiency / sales / profit. (Job re-design) may reduce the costs for FF – increased profitability. A two-sided analysis may also provide development: (Team working) may allow different employees to work together which may improve efficiency however may increase costs / cause distraction among employees; (Empowerment) may improve the quality of decisions made – however FF's fruit pickers may not make good decisions that benefit the business; (Participation) may lead to improved efficiency – however could slow down decision-making process; (Job enrichment) may make the employees want to and produce more however there may not be any opportunities for enrichment. Accept all valid responses.
14. [2] AO1 Knowledge and understanding: Limited knowledge will be demonstrated through knowledge of sustainability or knowledge of a stakeholder. Developed knowledge will be demonstrated from the knowledge of sustainability and knowledge of a stakeholder. For example: Knowledge of sustainability (max 1), including: the importance of sustainability, or a green business, is when a business has minimal negative impact or a positive effect on the global or local environment, community, society, or economy. The impact of sustainability in terms of cost, publicity, new markets etc. Knowledge of business stakeholders (max 1), including: individuals or groups with an interest in the activities of a business; internal stakeholders e.g. owners/shareholders, employees, managers / external stakeholders e.g. customers, local community, suppliers; the roles, rights and responsibilities of stakeholders.
15. [2] AO2 Application: Limited application applies knowledge of FF once. Developed application applies knowledge of FF twice. FF provides products to the industrial market (not consumer market); Move from single use plastic in packaging to recycled materials; Current system is labour intensive – new machinery would be capital intensive; Less chemicals used in growing; New Supply Chain Management required; Relevant stakeholders of FF; fruit pickers, shareholders (FF is a private limited company), industrial customers (likely to be grocery shops, supermarkets, restaurants etc.), suppliers (seeds, packaging), directors, environmentalists, local community (farm – large agricultural area), final customers (of fruit purchased in shops).
16. [2] AO3 Analysis: Limited analysis candidate shows one link in the chain of analysis. Developed analysis candidate shows two or more links in the chain of analysis. Impacts may include: Increase in costs e.g. purchase of machinery, cost of recycled materials; (Shareholders) reduced profit in the short run however, may increase profitability in the long run; (Directors) opportunity cost of new capital / increased decisions to be made – reduced employees to supervise; (Customers) increased price – may attract a new market of final customers (who favour sustainable products); More environmentally sustainable: (Customers) may choose to stock more of FF's products – to attract environmentally conscious final customers; (Environmental groups) may be happier with FF – may become customers of FF's customers; (Fruit pickers) may prefer to work for an environmentally sustainable business – may increase motivation; (Suppliers) may not be able to provide new materials so may lose sales – decreased profit; (Suppliers) FF may use new suppliers who gain FF as a customer – increased revenue; New supply chain management: (Suppliers) may have to change what is sold to FF – increasing suppliers' costs; (Environmental groups) may be happier with FF – and get more satisfaction from FF's products; (Local community) may be happier from less chemicals being used – increase value of homes / more pleasant living conditions; (Shareholders) may increase costs – however, may also increases sales to new customers; Change to capital intensive packaging process: (Shareholders) increased production costs – however, may increase profitability with new target market; (Employees) may no longer be required and may face redundancy – reduced income.
17. [6] AO4 Evaluation: Limited evaluation unsupported judgement and/or a weak attempt at evaluative comment. Developed evaluation supported judgement and/or reasonable evaluative comment. Developed evaluation in context supported judgement in context and/or reasonable evaluative comment in context. A judgement about the likely impacts of measures to improve the sustainability of operations on the stakeholders of FF. A judgement over which stakeholder(s) may be most impacted by the measures to improve sustainability. A judgement over the measures which are most likely to impact the stakeholders. Elements that the judgement could depend upon, including, the number of workers in the packaging section, the cost of the machinery to produce the recycled packaging, the availability of new suppliers, the level of impact on FF's costs/profitability, the objectives of different stakeholder groups, the objectives of FF. Weighing up of the impacts on stakeholders of the proposed measures to improve the sustainability of FF. Accept all valid responses.