CTV is a public limited company that produces and sells televisions. It has been operating in country A for 30 years. CTV owns 3 factories and has over 100 employees. CTV's factories use a combination of capital and skilled labour to produce the televisions. The leadership style in all the factories is autocratic. Employees' pay is based on time worked each week. The CTV brand is known for high-quality and reliability. It targets high-income customers. CTV uses price skimming when it launches a new product. In total, 6 million televisions were sold in country A in 2019. [Table 2.1] shows market growth data. [Table 2.1]: Television sales in country A Year | Market growth ---|--- 2020 | +2% 2021 | +1% 2022 | −3% (forecast) The market for televisions in country A is very competitive and the business environment is dynamic. CTV plans to introduce a lower priced television brand to appeal to the mass market. This brand will be known as STV. CTV has decided to introduce automation into one of its factories to produce the STV televisions. This will lead to redundancies in that factory. The employees in the other two factories are concerned they might also face redundancy and so motivation is currently low. The Human Resources Director recommends that CTV should find ways in which employees can participate in the management and control of the business.

Mark scheme

Marking points from the official mark scheme (May/June 2022). The mark or mark type is shown in brackets.

1. [2] Non-human man-made resources / factor of production needed to produce goods and services. Includes money and equipment that may be required for production. Money to start or run a business.
2. [1] Non-human/man-made resources/factor of production/money (finance).
3. [1] Used to produce goods and services/start or run a business.
4. [1] (C) Example or some other way of showing good understanding.
5. [1] (B) Understanding of dynamic.
6. [1] (A) Understanding of the business environment.
7. [3] The business environment refers to the external elements that a business operates within. For example, social, legal, economic, political, technological, competition, etc. Can also refer to the market in which a business operates. Dynamic means that the environment is changing, this might be in terms of the competition or changes in any of the external influences / market conditions.
8. [3] Correct answer with m.
9. [2] Correct calculation of growth for two years.
10. [1] Formula or correct calculation of growth for one year.
11. [1] 6m x 1.02 = 6.12m sold in 2020.
12. [1] 6.12m x 1.01 = 6.1812m sold in 2021.
13. [3] Answer = 6.1812m (Accept 6.18m or 6.181m).
14. [3] Explanation of one implication of a change in market growth in context (Level 2b APP).
15. [2] Explanation of one implication of a change in market growth (Level 2a K+K).
16. [1] Knowledge of one implication of a change in market growth (Level 1a K).
17. [1] Potentially less customers for CTV buying or replacing televisions in country A in 2022 (5.995764m) (Content).
18. [1] Could lead to competitors leaving the market (Content).
19. [1] May lead to CTV having to shut down one of their factories, if the decline is set to continue (Content).
20. [1] May lead to the market becoming more competitive – lower prices (Content).
21. [4] Good analysis of two advantages of automation in context (DEV+DEV) (Level 2b Knowledge and Application).
22. [3] Good analysis of one advantage of automation in context (DEV) (Level 2a Knowledge and Application).
23. [2] Limited analysis of two advantages of automation (AN+AN) (Level 1b Knowledge and Application).
24. [1] Limited analysis of one advantage of automation (AN) (Level 1a Knowledge and Application).
25. [1] Automation – using machinery for the production process, usually instead of human labour (Content).
26. [1] (Advantage) Reduction in cost of producing TV's – may allow CTV to compete in the mass market (Content).
27. [1] (Advantage) Mass market may have more opportunities for CTV to expand in this declining market (Content).
28. [1] (Advantage) Flexibility of an automated factory may allow CTV to launch more products and gain a higher market share (Content).
29. [1] (Advantage) Less susceptible to human issues, such as sickness and absence (Content).
30. [1] (Advantage) May be able to produce 24/7 without substantial extra wage cost (Content).
31. [7] Justified recommendation based on argument in context (EV+EV+EV) (Level for Analysis and Evaluation).
32. [6] Developed recommendation based on argument in context (EV+EV) (Level for Analysis and Evaluation).
33. [5] An evaluative statement/recommendation based on argument in context (EVAL) (Level for Analysis and Evaluation).
34. [4] Argument based on two ways in which CTV employees can participate in the management and control of the business in context (DEV+DEV) (Level for Knowledge and Application).
35. [3] Argument based on one way in which CTV employees can participate in the management and control of the business in context (DEV) (Level for Knowledge and Application).
36. [2] Limited analysis of two ways in which employees can participate in the management and control of a business (AN+AN) (Level for Knowledge and Application).
37. [1] Limited analysis of one way in which employees can participate in the management and control of a business (AN) (Level 1a Knowledge and Application).
38. [1] (Participation) Membership of the board of directors – employees could be given a representative on the board of directors. May be able to be part of any future decisions to automate the other factories (Content).
39. [1] (Participation) Profit share/ownership – employees could be given a 'stake' in CTV to allow them to feel that they are (in part) working for themselves. May be happy for future automation as it will increase the value of their profit or share (Content).
40. [1] (Participation) Works councils – to be able to have representatives that meet with the employers and present the employees point of view (Content).
41. [1] (Participation) Job enlargement and job enrichment – automation may bring new opportunities for employees to develop their skills and feel more secure about their jobs (Content).
42. [1] (Participation) Suggestion schemes – may allow employees to put forward ideas to avoid further redundancies (Content).
43. [1] (Participation) Quality circles – quality is an important part of CTV's main brand – quality circles may allow this brand to continue being successful and keep open the other two factories (Content).
44. [1] (Participation) TQM (Content).
45. [1] (Participation) Empowered teams (Content).
46. [Note] as the business is a plc with autocratic leadership and implementing change, award context as appropriate e.g. share ownership, board of directors, autocratic, automation, process innovation etc. (Content).