Advise CC on an operations strategy to enable its future survival and growth. Refer to the case study 'Clothing Company (CC)' and its appendices.

Mark scheme

Marking points from the official mark scheme (Feb/Mar 2024). The mark or mark type is shown in brackets.

1. [3] (AO1 Knowledge and understanding Level 3) Developed knowledge of relevant key term(s) and/or factor(s) is used to answer the question.
2. [2] (AO2 Application Level 3) Developed application of relevant point(s) to the business context.
3. [7-8] (AO3 Analysis Level 3) Developed analysis of the overall strategy that identifies connections between causes, impacts and/or consequences.
4. [6-7] (AO4 Evaluation Level 3) Effective evaluation: A developed judgement/conclusion is made in the business context that draws together developed evaluative comments which balance some key arguments in the business context.
5. AO1 Knowledge and understanding (max 3 marks):
6. Knowledge (max 1 mark) can be awarded for any relevant business knowledge about operations, including: The transformational process (inputs, outputs, added value, factors of production); Efficiency, effectiveness, productivity and sustainability; Capital and labour intensity; Operations methods (job, batch, flow, mass customisation); Inventory management (types of inventory, buffer, re-order level, lead time, supply chain management, JIT and JIC); Capacity utilisation; Outsourcing; Location; Scale of operations (economies and diseconomies of scale); Quality management (quality control, quality assurance, TQM, benchmarking); The meaning and purpose of an operations strategy; The influence of human, marketing and finance resource availability on operations decisions; The changing role of Information Technology (IT) and Artificial Intelligence (AI) in operations management; The need for flexibility with regard to volume, delivery time and specification; Process innovation: changing current processes or adopting new ways of producing products or delivering services; The main features of an ERP programme; How ERP can improve a business' efficiency in relation to: inventory control, costing and pricing, capacity utilisation, responses to change, workforce flexibility, management information; The aims and purposes of lean production (Kaizen, quality circles, simultaneous engineering, cell production, JIT manufacturing and waste management); Operations planning (network diagrams, critical path analysis).
7. Award DEV for any explanation of relevant business knowledge, up to a max of 2 marks.
8. AO2 Application (max 2 marks):
9. Application (max 2 marks) can be awarded for applying knowledge of operations/operations strategy, to CC.
10. Award one APP for each application of knowledge.
11. [1 APP] John Dee replaces Sulwar in 2020.
12. [1 APP] John insists on new quality control procedures.
13. [1 APP] The share price remains low, but stable.
14. [1 APP] A new and distinctive operations strategy to reduce costs and increase efficiency is needed.
15. [1 APP] CC operates its own branded clothing retail stores only in the US.
16. [1 APP] CC used to have only four main seasonal ranges: spring, summer, autumn and winter.
17. [1 APP] Competition from online only retailers has reduced CC's market share.
18. [1 APP] CC has been a popular choice with both customers and investors.
19. [1 APP] John is set an objective to restore CC's brand reputation.
20. [1 APP] Any relevant data from Appendix 1–4.
21. AO3 Analysis (max 8 marks):
22. Analysis of the impact of CC's operations strategy (A1 and A2 and A3) including:
23. Human resources availability – are younger graduates able to understand the original target market – does their vision align with an original brand reputation and John's strategy?
24. Marketing availability – will marketing graduates be able to create an original but improved marketing strategy which does not create the same problems 2010–16?
25. Revenue has dropped by 25% since 2008 (and profit has dropped by 90%) – does CC have the available funds to invest in new marketing techniques/AI/IT?
26. Methods of regaining lost customers using the operations function.
27. Improving flexibility and innovation within operations; increase sales volume – to increase customer retention.
28. The use of and ERP programme – cost/benefit analysis of this and the effects of this on CC.
29. Introduction of lean production – cost benefit analysis of this and the effects of this on CC.
30. Any other relevant operations methods.
31. AO4 Evaluation (max 7 marks):
32. Evaluation (N1 and N2 and Na) including:
33. A judgement about an operations strategy for CC to enable CC's survival and growth.
34. Judgement may depend upon: market research findings, external influences in the US (PEST), internal and external influences on CC (SWOT), the reactions of potential competitors in the US, the extent of the investment to meet the new strategy.
35. Weighing up of the relevant arguments for the different future strategies.
36. The board of directors (and shareholders) level of risk that they would be willing to accept.
37. Accept all valid responses.