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Oxford Business College

EDEXCEL

BTEC Higher Nationals Unit 1

Business Environment
Course Tutor: Priscilla Clark-Christopher

Unit Brief: 4th July to 9th


September 2016
Credit value: 15 credits
QCF level 4:

Unit code: Y/601/0546


Verified by:

You are reminded of Oxford Business Colleges policy on unfair practice (ie Academic Impropriety, which
covers a range of infringements related to the assessment* process). It applies in any situation where a student is
attempting to gain credit by unfair or improper means and covers cheating, attempts to cheat, plagiarism and
collusion. Please refer to the Unfair Practice Procedure document issued and explained at induction for more
information.
* The term assessment covers all types of assessment including assignments, examinations and presentations.

Business Environment

Table of Contents
Unit aim........................................................................................................................... 3
Unit Abstract.................................................................................................................... 3
Learning outcomes........................................................................................................... 3
Unit Content & Description.............................................................................................. 3
1 Understand the organisational purposes of business.................................................3
2 Understand the nature of the national environment in which businesses operate...4
3 Understand the behaviour of organisations in their market environment.................4
4 Be able to assess the significance of the global factors that shape national
business activities......................................................................................................... 5
The Four Assignments...................................................................................................... 5
Assignment 1: Businesses and the National Environment (relates to LO2)...................5
Assignment 2: Organisational Behaviour in the Market Environment (relates to LO3)..6
Assignment 3: Business organisations: their aims, stakeholders, and responsibilities
(relates to LO1)............................................................................................................. 5
Assignment 4: International environment (LO4)...........................................................6
Grade criteria................................................................................................................... 6
Criteria for a pass......................................................................................................... 6
Criteria for a merit........................................................................................................ 7
Criteria for a distinction................................................................................................ 7
Linking the Assignments and Tasks to the Learning Outcomes and Assessment Criteria 9
Scheme of Work (your weekly timetable for this class)..................................................12
Reading list:................................................................................................................... 15

Business Environment

Unit aim
The aim of this unit is to provide learners with an understanding of
different organisations, the influence of stakeholders and the relationship
between businesses and the local, national and global environments.

Unit Abstract
Organisations have a variety of purposes that depend on why they were
established. Some operate for profit, whilst others do not.
Organisations structure themselves and operate in ways that allow their
objectives to be met. Every organisation has a range of stakeholders
whose interests need to be satisfied, but stakeholders have competing
interests that may be hard to reconcile.
Businesses operate in an environment shaped by the government,
competitors, consumers, suppliers, and international factors. Learners
will understand that some influences on the business environment are
direct and clear, for example taxation policies on corporate activities.
Others are less clear, perhaps coming from the international arena and
sometimes with only an oblique impact on the national business
environment.
It is within this business environment that organisations function and
have to determine strategies and a modus operandi that allow them to
meet their organisational purposes in ways that comply with the
relevant legal and regulatory frameworks. In addition, business markets
take various forms and the structure of a market enables an
understanding of how organisations behave. In this unit learners will
consider how different market structures shape the pricing and output
decisions of businesses, as well as other aspects of their behaviour.

Learning outcomes
On successful completion of this unit a learner will:
1.

Understand the organisational purposes of businesses

2.

Understand the nature of the national environment in which


businesses operate

3.

Understand the behaviour of organisations in their market


environment

4.

Be able to assess the significance of the global factors that shape


national business activities

Business Environment

Unit Content
1 Understand the organisational purposes of businesses
Categories of organisation: legal structure; type e.g. private
company, public company, government, voluntary organisation,
co-operative, charitable; sector (primary, secondary, tertiary)
Purposes: mission; vision; aims; objectives; goals; values;
profits; market share; growth; return on capital employed
(ROCE);sales; service level; customer satisfaction; corporate
responsibility; ethical issues
Stakeholders:
owners; customers; suppliers; employees;
debtors; creditors; financial institutions (banks, mortgage
lenders, credit factors); environmental groups; government
agencies(central government, local authorities); trade unions
Responsibilities of organisations: stakeholder interests; conflict
of expectations; power-influence matrix; satisfying stakeholder
objectives; legal responsibilities e.g. consumer legislation,
employee legislation, equal opportunities and antidiscriminatory
legislation, environmental legislation, health and safety
legislation; ethical issues e.g. environment, fair trade, global
warming, charter compliance e.g. Banking Code

2 Understand the nature of the national environment in


which businesses operate
Economic systems: the allocation of scarce resources; effective
use of resources; type of economic system e.g. command,
free enterprise, mixed, transitional

The UK economy: size (gross domestic product, gross national


product); structure; population; labour force; growth; inflation;
balance of payments; balance of trade; exchange rates; trading
partners; public finances (revenues, expenditure); taxation;
government borrowing; business behaviour e.g. investment,
objectives, risk awareness; cost of capital; consumer behaviour;
propensity to save; propensity to spend; tastes and preferences
Government policy: economic goals; fiscal policy: control of
aggregate demand; central and local government spending; Public
Sector Net Borrowing (PSNB)and Public Sector Net Cash
Requirement (PSNCR);euro convergence criteria, monetary
policy; interest rates; quantitative easing; private finance
initiative (PFI); competition policy (up-to-date legislation including
Competition Act 1998, Enterprise Act 2002); Competition
Commission, Office of Fair Trading; Directorate General for
Competition); European Commission); sector regulators e.g.
Ofgem, Ofwat, Civil Aviation Authority; Companies Acts; regional
policy; industrial policy; enterprise strategy; training and skills
policy
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Business Environment

3 Understand the behaviour of organisations in their market


environment
Market types:
perfect competition, monopoly, monopolistic
competition, oligopoly, duopoly; competitive advantage, strategies
adopted by firms; regulation of competition
Market forces and organisational responses: supply and demand,
elasticity of demand; elasticity of supply; customer perceptions and
actions, pricing decisions; cost and output decisions; economies of
scale, the short run; the long run, multi-national and transnational
corporations; joint ventures, outsourcing; core markets; labour market
trends; employee skills, technology; innovation; research and
development; core competencies; business environment (political,
economic, social, technical, legal, environmental); cultural environment

4 Be able to assess the significance of the global factors


that shape national business activities

Global factors: international trade and the UK economy; market


opportunities; global growth; protectionism; World Trade Organisation
(WTO); emerging markets (BRIC economies- Brazil, Russia, India, China);
EU membership; EU business regulations and their incorporation in to UK
law; EU policies e.g. agriculture (CAP), business, competition, growth,
employment, education, economics and finance, employment,
environment, science and technology, regional); labour movement;
workforce skills; exchange rates; trading blocs e.g. monetary unions,
common markets; customs unions, free trade areas); labour costs; trade
duties; levies; tariffs; customs dues; taxation regimes; international
competitiveness; international business environment (political, economic,
social, technical, legal, environmental); investment incentives; cost of
capital; commodity prices; intellectual property; climate change e.g.
Kyoto Protocol, Rio Earth Summit; third world poverty; the group of 20
(G-20); global financial stability.

The Four Assignments


Learners will be producing 4 separate tasks/assignments as part of their full
report for this unit. The Details of sub-tasks for each assignments are outlined
below.

Scenario for this term: Oil producing


company.
Assignment 1: Business organisations: their aims,
stakeholders, and responsibilities (relates to LO1)

Due date: 19 July 2016

The following tasks should be presented as a written report (600- 800


words) to a new Non-Executive Director of your chosen oil producing firm.
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1.1. Identify the purposes (long term goals, vision or mission) of the
company you selected. Make comparisons with the Directors previous
organisation, which you can choose; their previous firm may have been
small or large, but was in a different industry.
1.2 Describe the objectives of three key stakeholders in this company
and assess the extent to which the company has achieved their likely
objectives (not the firms objectives) over the last five years.
1.3 Explain the range of responsibilities your firm has to society and key
stakeholders, and how it fulfils them.

Assignment: Businesses and the National Environment


(relates to LO.2)

Due date: 3 August 2016

The following tasks should be presented as a written report (600- 800


words to answer all three parts).
2.1. Explain the economic system that controls how resources are
allocated in the economy of your home country. Give examples of how
alternative systems try to achieve effective resource allocation.
2.2 Assess the impact of fiscal and monetary policy on businesses in
your home country.
2.3 Evaluate the impact of competition policy and other relevant
regulatory mechanisms on the activities of a UK based company.

Assignment 3: Organisational Behaviour in the Market


Environment (relates to LO.3)

Due date: 17 August 2016

In no more than 600- 800 words complete the following tasks as a report
for a new Director of your firm:
3.1 Explain the main theoretical differences between perfect
competition, imperfect (or monopolistic) competition, and
oligopoly. Then use an example of each to explain how market structures
can determine a businesss pricing or output decisions in practice.
3.2 Illustrate the way in which market forces (supply and demand) shape
organisational responses, using recent examples from different sectors.
3.3 Assess how the way your chosen firm behaves is affected by the
business macro environment, particularly by cultural factors.

Assignment 4: International environment (LO4)

Due date: 6 September 2016


The three tasks should be presented as a written report (600- 800 words)
and included in the full report.
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Business Environment

4.1. Discuss the significance of international trade to two UK


businesses.
4.2. Analyse the most important global factors currently affecting two
UK businesses, and assess their impact on those organisations.
4.3. Evaluate the impact of EU policies on UK business organisations.
Use two or more examples to say how EU rules or policies affect UK
firms behaviours (or costs and revenues).

Grade criteria
Criteria for a pass
P1
Create a Report that achieves all the learning outcomes listed
above. This Report will consist of four sequential Assignments, each
addressing a main Learning Outcome. Within these there are 12 Tasks that
address each of the detailed Assessment Criteria listed on page 4 of
document BH023329 Issue 8.

Criteria for a merit


A merit grade is attained by achieving all the criteria for a pass grade and
M1 Applying strategies to find appropriate solutions: in this
module this means applying an effective approach to studying and
research i.e. actively participating in the classes and completing the
report in the manner and at the times specified in the Module guide (NOT
weeks later), so that any learning difficulties can be identified and
remedied by your tutor in classes at the time;
and
M2 Applying a range of appropriate methods, theories or
techniques effectively to answer the task or question asked. In
other words a student must apply some of the theories taught in classes
to answer the tasks; especially tasks 3.1, 3.2, 3.3 and 4.2 offer excellent
scope to apply theories or frameworks
and
M3 Using a structure and approach to communication which
is appropriate to the context and to the audience. In this Unit this
means producing a formal Report with
1. a Title page,
2. an automated Table of Contents (use Words Headings commands),
3. A brief Introduction at the beginning,
4. a longer, holistic Conclusion at the end
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Business Environment

5. page numbers at the foot of each page


6. headers and footers,
7. Appendices, and
8. a list of References at the end.
The text should also include tables or charts you have drawn yourself so
at to make your report as clear and persuasive as possible, while
remaining within the word limit.

Criteria for a distinction


A distinction grade is attained by achieving all the criteria for a merit
grade and
D1
Using critical reflection to evaluate your own work and
justify valid conclusions. In other words, to get a Distinction draw
general conclusions from earlier findings, discuss these and how your
views about the subject firm have changed over the term as you have
learned more about the firm then conclude this discussion with logical
and practical recommendations for the firm to implement; this is best
done in the final Conclusion to your report
and
D2
Taking responsibility for managing and organising the
production of a substantial Report on time, so that every
Assignment is delivered punctually. In doing this you will demonstrate
independent learning, professionalism, and an ability to accommodate the
unforeseen. In other words, to get a Distinction you must write a
substantial, independently-researched Report, delivering each Assignment
on time;
and
D3
When solving problems, demonstrate convergent, lateral or
creative thinking, or show evidence of wider reading which
converges to a useful conclusion. In short, to get a Distinction you
must quote from some relevant texts not on the Reading list, and apply
their methods to solve an identified problem, or come up with a new and
innovative solution that solves the set Task. Any of the Tasks in
Assignments offer wide scope for this.

Business Environment

Linking the Assignments and Tasks to the Learning Outcomes and


Assessment Criteria
The table below links the Units four Assignments and individual Tasks to the Learning Outcomes and detailed
Assessment Criteria specified in Edexcels Level 4 BTEC document BH023329 Issue 8, February 2015.
Learning
outcomes

Assessment criteria
No Detailed criteria
.

LO1
Understand
the
organisational
purposes of
businesses

LO2

1.
1

Identify the purposes of


different types of organisation

1.
2

Assi
gnment
No.
1

Task
No.

Summary of task

1.1

Identify the purposes (long term goals,


vision, or mission) of the company you
selected organisation. Draw comparisons
with another organisation, small or large, in
a different industry.

Describe the extent to which an


organisation meets the
objectives of different
stakeholders

1.2

Describe the objectives of three key


stakeholders in this company and assess
the extent to which the company has
achieved their likely objectives over the last
five years.

1.
3

Explain the responsibilities of


an organisation and strategies
employed to meet them

1.3

Explain the most important responsibilities


your selected company has to society and
key stakeholders, and how it fulfils them.

2.
1

Explain how economic systems


attempt to allocate resources

2.1

Explain the system that controls how


resources are allocated in the economy of

Business Environment

Learning
outcomes

Assessment criteria
No Detailed criteria
.

Understand
the nature of
the national
environment
in which
businesses
operate

LO3
Understand
the behaviour
of
organisations
in their market
environment

Assi
gnment
No.

Task
No.

effectively

Summary of task
your home country. Give examples of how
alternative systems try to achieve effective
resource allocation.

2.
2

Assess the impact of fiscal and


monetary policy on business
organisations and their
activities

2.2

Assess the impact of fiscal and monetary


policy on businesses in your home country.

2.
3

Evaluate the impact of


competition policy and other
regulatory mechanisms on the
activities of a selected
organisation

2.3

Pick a UK supermarket chain, and evaluate


the impact of competition policy and other
relevant regulatory mechanisms on its
activities in recent years.

3.
1

Explain how market structures


determine the pricing and
output decisions of businesses

3.1

Explain the main theoretical differences


between perfect competition, imperfect
competition and oligopoly. Then use an
example of each to explain how market
structures can determine a businesss
pricing or output decisions in practice.

3.
2

Illustrate the way in which


market forces shape
organisational responses using
a range of examples

3.2

Illustrate the way in which market forces


shape organisational responses, using
recent examples from different sectors.

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Business Environment

Learning
outcomes

Assessment criteria
No Detailed criteria
.

LO4 Be able to
assess the
significance of
the global
factors that
shape national
business
activities

3.
3

Judge how the business and


cultural environments shape
the behaviour of a selected
organisation

4.
1

Discuss the significance of


international trade to UK
business organisations

4.
2

4.
3

Assi
gnment
No.

Task
No.

Summary of task

3.3

Assess how your chosen firm is affected by


the business environment, specifically by
the macro environment and by cultural
factors.

4.1

Discuss the significance of international


trade to two UK businesses.

Analyse the impact of global


factors on UK business
organisations

4.2

Analyse the most important global factors


currently affecting two UK businesses and
assess their impact on those organisations

Evaluate the impact of policies


of the European Union on UK
business organisations

4.3

Evaluate the impact of EU policies on UK


business organisations. Use two or more
examples to say how EU rules or policies
affect UK firms behaviours (or costs and
revenues).

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Business Environment

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Business Environment

Scheme of Work (your weekly timetable for this class)


Week
No.

Class date

Week1:

5 July

Class topics

Homework for next class

2016
Introduce Class; outline Course & Assignments;
distribute Scheme of Work and Assignment 1.
IN COMPUTER ROOM Revise use of Word to write
reports Headings, headers & footers, captions,
Tables of Figures, TOC
6 July

Week 2:

12 & 13 July

Purposes of a firm, values & culture. Legal types


of firm, starting & growing a firm, the difference
between equity & debt, what happens when
different types of firm go bust.

BPP Chapter 1.1

STEEPLE, Environmental responsibilities,


stakeholders, stakeholder mapping, difference
between objectives and responsibilities, ethical &
social responsibilities, Bhopal case, prioritising
conflicting objectives

Read BPP Chapter 2

W&B chapter 1 page 4

Assignment 1 Submission date: 19 July 2016


Week 3:

19 July

Types of economy: subsistence agriculture,


developed & emerging economies; capitalism,
communism & transitional economies. What
governments can and cannot do in market
economies; how taxes and subsidies affect prices
influencing firms and households; Distribute
lecture notes

BPP Chapter 1.2


BPP Chapter 5.1 and 5.2; Revise lecture
notes and complete

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Business Environment

Week
No.

Week 4

Class date

Class topics

Homework for next class

20 July

Review Task 1.1; Circular flows of money in an


economy, fiscal and monetary policies to stabilise
market cycles; the 2008 global debt crisis, and its
economic effects.

BPP Chapter 5.3 Revise lecture notes and


investigate; complete Task 2.1 and 2.2
print out, and bring to next class

26 & 27 July

Review Task 2.2; EU & UK Competition bodies,


rules & frameworks; Articles 101 & 102, 1998
Competition Act, and merger controls

BPP Chapter 9.5; complete Task 1.3,


print out, and finish Assignment 2 .

2016

Assignment 2 (LO2) submission date: 3 August 2016


Week 5

Week 6

2 August

Commodities & differentiated products, classical


economic market structures, industry value
chains & Porters 5-forces;

Read Chapter 1 BPP; Draft Task 3.1 print


out and bring to class

3 August

Review the oil value chain and Task 3.1s; sources


of primary energy, OPEC, cartels, in practice,
world oil prices, and where the balance of
bargaining power lies upstream, midstream and
downstream

BPP Chapter 1.5 for stakeholders Chapter


2 for responsibilities; Complete Tasks
3.2 & 3.3; bring printout to next class

Industry supply & demand, measuring them in


practice; production, consumption, net exports &
stock changes; local, national & global markets;
revise oil value chain

Revise Tasks 3.1-3.2, complete Task 3.3,


print out

STEEPLE, basic descriptions of society:


demographic measures: birth & death rates,
migration, population growth rates; national &
global cultures, marketing segments, trends in
household size, employment trends, ageing.

Complete Task 3.4, finish Assignment


3, print out, and hand in to Tutor at
start of next class

9 August

10 August

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Business Environment

Week
No.

Class date

Class topics

Homework for next class

2016

Assignment 3(LO3) Submission deadline: 17 August 2016


Week 7

16 August

International trade, Balance of Payments current


& capital account trends; Review Task 4.1; global
international institutions; Distribute Assignment 4

BPP Chapter 10.1 and revise lecture notes;


draft

17 August

Trends in the global economy; the 2008 debt


crisis; European Union history and its centralised
powers; growth of the EU and the Single
European market; and lecture notes.

Revise Task 4.1

17 August

Review Tasks 4.1 & 4.2; Doing business within the


EU; EU policies on Immigration, Energy, Water,
Fishing, Environment and Transport. EU policies in
the 21st century

Read BPP Chapter 10.3, Chapter 14 W&B

Week 8

23 August

Review Task 4.1-4.3. Internal structure of a firm,


roles & titles within firms, franchising, licensing &
joint ventures;

Week 8

24 August

Politics & culture: what governments do for


business; war, civil war, anarchy, main systems of
government, why democracies endure; case
studies: Afghanistan, Zimbabwe, Congo.
Distribute lecture notes

Read Chapter 3 W&B; Revise political


lecture notes,

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Business Environment

Week
No.

Class date

Class topics

Week 9

30 & 31
August

Tutor on holiday

Week 10

5&6
September

Receive feedback on Assignment 4; incorporate


comments and work in class to improve Final
Report

Homework for next class

2016

Assignment 4 (LO4) Submission deadline: 6 September 2016


Revise Final Report & submit on 9th September 2016.
* In exceptional circumstances Oxford Business College, at the tutors discretion, may review the opportunity for a student to
achieve a higher grade, provided the student had serious difficulties beyond their control achieving the deadline, and
provided the student immediately and visibly recovers not only all lost ground in the following two weeks but also submits all
new work required on time. Failure to achieve either of these will result at most in a Pass grade for the Unit.

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Business Environment

Reading list:
BPP Learning Media Business Essentials (supporting HNC/HND and Foundation
Degrees) Business Environment, 2013, BPP, Walsall referred to as BPP, or the
core text
Worthington I & Britton C The Business Environment Prentice Hall (5th edition)
2006 best overall book yet found, 20 on eBay; make sure you get the 5th
edition or later; chapters in this are used as the textbook for this course in the
course outline referred to as W&B
Brooks, Weatherston and Wilkinson The International Business Environment
Prentice Hall 2004 Old now, but at least it is international from the start
Morrison J The international business environment, 29 Palgrave Macmillan 2nd
edn. 2006
For the economic parts (market structures etc)
Mulhearne C and Vane H, 2012, Economics for business, Palgrave-Macmillan 3rd
edition 2012 Chapters 1, 2 and especially 5 is a good basic microeconomics
textbook with great cartoons, pictures and captions; the only economics
textbook that has actually made me laugh out loud.
Krugman P and Wells R, 2013, Economics, Macmillan, Third International edition
is the best all-round introductory Economics textbook I have seen. A very
friendly style with lots of diagrams, but it is heavy. If buying a used one on e-Bay
make sure you get the Third International edition.
Other books on the business environment are available but in the tutors opinion
they are not as good as the above, even if they are more modern.
--------------------For general access to data about firms and analysis of firms within industries
dont forget to use OBCs access to MarketLine.

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