QCF Syllabus

The Business Environment

Unit Title The Business Environment

Unit Reference Number F/601/2811
Guided Learning Hours 160
Level 5
Number of Credits 18

Unit purpose and aim(s):

This unit aims to give learners a sound understanding of:
 the significance of the environment for business
 the structure and organisation of business
 the competitive and political environment facing business
 the impact of the macro-economic environment and of the global economy on business

Learning Outcome 1

The learner will: Understand the significance of the environment on business activity.

Assessment Criteria Indicative Content

The learner can:
1.1 Explain the features of business
activity.
1.2 Discuss the complex interactions
that operate between a business
and its environment.
1.3 Explain the need for change and
its management within an
individual business.
1.1.1 Explain the business organisation as a transformation process.
1.1.2 Describe the different ways in which a business may structure its activities.
1.2.1 Discuss the complexity, volatility and uniqueness of an organisation's environment.
1.2.2 Outline the nature of the external environment (PEST).
1.3.1 Discuss the need to monitor changes in the external environment.
1.3.2 Discuss the implications of environmental change for a business, its stakeholders
and society.
1.3.3 Explain reasons for resistance to change by firms, managers and employees.
1.3.4 Describe ways in which resistance to change may be overcome.

Learning Outcome 2

The learner will: Understand the structure and organisation of business.

Assessment Criteria Indicative Content

The learner can:
2.1 Discuss the impact of industrial
and legal structure and size on
organisational behaviour.
2.1.1 Classify businesses by sector – primary, secondary and tertiary – and discuss reasons
for changes in industrial structure, including concentration.
2.1.2 Discuss the advantages and disadvantages of different legal forms of organisation.
2.1.3 Discuss the use of franchises, licensing and joint ventures as means of doing
business in both national and international spheres.
2.1.4 Distinguish between public sector and private sector organisations and their
objectives.
2.1.5 Explain the advantages and disadvantages of large and small firms.
Learning Outcome 3
The learner will: Understand the competitive and political environment facing businesses.
Assessment Criteria
The learner can:
3.1 Discuss differing ways of
analysing the environment of a
business.
3.2 Explain the impact of market
structure on the behaviour of
firms.
3.3 Describe the complex
interactions between business
and government.
3.4 Discuss the need for government
intervention and the forms it
might take.
Learning Outcome 4
The learner will: Understand the impact of the macro-economic environment on business.
Assessment Criteria
The learner can:
4.1 Compare and contrast alternative
economic systems.
4.2 Analyse the role of government
in controlling the level and
pattern of economic activity.
Learning Outcome 5
The learner will: Understand the influence of the global economy on business.
Assessment Criteria
The learner can:
5.1 Discuss the importance of
international free trade and its
operation.
5.2 Assess the main causes and
implications of globalisation.
Indicative Content
3.1.1 Discuss the need to monitor the competitive environment of businesses.
3.1.2 Analyse a business organisation, using SWOT analysis.
3.1.3 Apply Porter’s Five Forces analysis of the competitive environment to a business
organisation.
3.2.1 Describe the characteristics of perfect competition, monopolistic competition,
oligopoly and monopoly.
3.2.2 Describe forms of anti-competitive behaviour and their impact upon other
organisations and consumers.
3.3.1 Describe the different ways that a government may affect business.
3.3.2 Assess the role of pressure groups and lobbyists on business and government.
3.4.1 Describe need for government intervention to control the competitive activities of
business organisations.
Indicative Content
4.1.1 Assess the advantages and disadvantages of centrally planned and market
economies.
4.1.2 Discuss the need for the provision of public goods and merit goods in a mixed
economy.
4.2.1 Describe the four main macro-economic objectives of government: low inflation,
economic growth, low unemployment and balance of payments stability.
4.2.2 Explain the nature and characteristics of the business cycle.
4.2.3 Discuss the impact of the stages of the business cycle on business and the economy.
4.2.4 Discuss the role of fiscal policy in the control of the economy.
4.2.5 Discuss the role of monetary policy in the control of the economy.
Indicative Content
5.1.1 Explain the reasons for international trade and barriers to free trade.
5.1.2 Describe the importance of regional trading blocs such as ASEAN, NAFTA, SADC,
CARICOM and the EU.
5.1.3 Explain the impact of exchange rate fluctuations on international business.
5.2.1 Describe the main causes of globalisation.
5.2.2 Describe the advantages and disadvantages of globalisation.
5.2.3 Describe the advantages and disadvantages of multi-national corporations,
franchises and joint international ventures.
Learning Outcome 6

The learner will: Understand the impact of socio-cultural influences and technology on business decisions.

Assessment Criteria Indicative Content

The learner can:
6.1 Describe key demographic and
social trends that affect business.
6.2 Discuss Corporate Social
Responsibility (CSR) and its
implications for business.
6.3 Discuss the impact of technology
on business and business
systems.
6.1.1 Describe the implications of demographic changes for business activity (e.g. the age
profile of the country’s population).
6.1.2 Describe the impact of social and cultural changes on the conduct of business and
business activity.
6.2.1 Define the meaning of CSR and explain the different views on it.
6.2.2 Discuss the role of business in promoting ethical practices.
6.2.3 Discuss the costs and benefits to businesses of implementing environmentally
friendly (green) policies.
6.3.1 Identify and describe the different forms of technological change, including the
introduction of e-commerce and different applications of technology.
6.3.2 Assess advantages and disadvantages for business activity of technological change.

Assessment:

 Assessment method: written examination (unless otherwise stated).

 Written examinations are of three hours’ duration.
 All learning outcomes will be assessed.

Recommended Reading:

 Please refer to the Tuition Resources section of the Members Area of the ABE website (www.abeuk.com) for the
recommended reading for this subject.