With reference to JAC, describe two advantages of internal growth (line 52).

With reference to John, explain the key functions of management.

Internal growth: selling more; widening product range; expanding facilities

• JAC is a relatively small enterprise relative to Utopia so it would not be too difficult to raise the resources to grow JAC internally.
• John Ariki’s philosophy is for internal growth.
• Because of the emphasis on local culture, specialised coffee, etc, it is important for JAC to retain control – control might be diluted with external growth.
• With outside influences the vision for JAC might be diluted.
• JAC is part of Utopia so the vision for Utopia is relevant.
• Gaining economies of scale e.g. bulk buying coffee for the whole business
Remember: JAC is owned as a sole trader

Mark as 2+2.

Award [1] for each advantage identified, and [1] for the development of each of these key aspects in the context of JAC/Utopia/John, up to a maximum of [2].

Key functions of management are:
• setting objectives and planning
• organising resources to meet objectives, including staff recruitment
• directing and motivating staff
• coordinating activities
• controlling and measuring performance.

With reference to John:
• He created the original business plan.
• He made decisions about reflecting local culture and resisting external stakeholders.
• He organises local suppliers.
• It was his decision to open café.
• He creates crisis management and contingency plans.
• He decides on options.
• He delegates to his children but keeps the reigns.
• He organised and managed a meeting between himself, Liza and Paul.
• He monitors performance.
• He sets organisational structure and manages changes.
• He makes the final decision.

Accept any other relevant analysis.

Marks should be allocated according to the Paper 1 markbands for May 2016 forward, section A.

Award a maximum of [3] for a theoretical answer.

Award a maximum of [5] if the explanation of functions is mainly descriptive but in context.

For full marks the explanation needs to be developed and in context.

Some candidates confused ‘internal growth’ with ‘internal sources of finance’. Contextual ideas that were developed well included John wanting to retain control and reject external influences and the danger of external influences diluting the business model including ethics.

A surprising number of candidates confused ‘management’ with ‘leadership’ and answered a question about John’s leadership style. The best answers developed the main functions of management (setting objectives, organising resources, directing and motivating staff, coordinating, controlling and measuring) linking the answers with the roles played by John (and others) in the business.