paper 2 interdependent nature of business Flashcards
4 features of the interdependent nature of business
interdependent nature of business operations, finance, marketing and human resources within a business context
how these interdependences underpin decision making
the impact of risk and reward on business activity
the use of financial information in measuring and understanding business performance and decision making
what does interdependence mean in the context of business
how what happens in one business area will affect something in another - the business areas are limked.
what is the impact of interdependence on the business
they must ensure that when they make decisions in one are they must consider the effects on other areas
areas of business are connected and dependent on each other
year 1 sales = 200,00 units profits £5million
year 2 sales =100,000 units profits £3 million
use the information in the table to show how 4 features of interdependence may be part of a single business decision
a business will work out why sales and profits have fallen - it concludes a competitor is selling goods lower
Business decides to introduce new technology to lower costs and reduce the price charged.
Introducing new technology is a decision in business operations
This decision would affect human resources as fewer workers maybe needed or workers needed who have the skills to use the technology
The introduction of new technology will effect finance department (it is trying to reduce costs) the business would need to finance the purchase of new technology and would need to look for sources of finance
finally the decision will effect the marketing department - decisions need to be made about the price to charge - price and promotion are in the marketing mix.
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