Define the term contingency planning.

Explain two elements of PU’s organizational culture after the accident at the nearby chemical plant.

Using the straight line method, calculate the annual depreciation for each laptop (show all your working).

Comment on the usefulness to PU of the results of your calculation in part (i).

Using information from the case study and additional information above, discuss the importance to PU of the extended marketing mix in the provision of services at the university.

Contingency planning is preparing for an outcome other than that expected in usual circumstances. It often used to manage risks for exceptional circumstances that could have a catastrophic outcome.

Beware of circular definitions, which cannot be rewarded.

There needs to be some suggestion of forward thinking (prior to things/events that might happen).

Some may focus on contingency planning as a way of ‘preventing’ things/events happening. This should only be awarded [1].

Candidates do not have to word exactly as above. Award [1] for a partial definition which contains some of the elements, award [2] for a clear definition that shows understanding. No application is required. Maximum award: [2].

Organizational culture refers to the underlying beliefs, assumptions, values and ways of interacting that contribute towards the working environment of a business.

E.g. teamwork; community; trust; innovation; caring; trustworthy management.

Two elements of PU’s organizational culture include:

• The main changes have been a ‘hardening’ of the culture to overcome the accident.
• Funds have declined, competition between faculties has increased and this changes the nature of working relationships, possibly greater efficiency but maybe distrust?
• Demanding targets: More stress? Better, clearer focus? Is this appropriate to a university?
• Less time on student welfare: indicative of a less caring organization?

Other possible issue arises from the case study: change of focus to online teaching – less social contact; a culture that did nothing about intolerant behaviour.

Some may wish to make use of actual types of culture (role; task etc.). This is fine but the context is critical.

Some of the mission statement may not have been achieved in particular, inclusivity with some online teaching making courses less available to some, excellence with some courses compromised.

Mark as [2] + [2].

Award [1] for each appropriate element identified and an additional [1] for explanation applied to the stimulus. Maximum award: [4].

Cost of laptop $500

Residual value $50

Fall in value $450 over 3 years = $150 per year per laptop (or annual depreciation per laptop)

OR
$\frac{\$500-\$50}{3}=\frac{\$450}{3}=\$150$ per year per laptop

OR
Candidates can present the annual depreciation as a percentage: 30 % (150 / 500).

Accept answers where candidates calculate the total depreciation $150 x 500 = $75000 and present this as their final answer as long as the $150 in included as part of the working.

Possible answers and marks:
$150 with working [2]
30 % with working [2]
30 % without working [1]
150 (no units) with working [1]
$75000 without mention of $150 [1] (an attempt)
$75000 with working and mention of $150 [2]

Award [2] for correct answer, with workings and correct units.
Award [1] for a reasonable attempt or absence of workings and/or correct units.

Depreciation is a component of profit/loss and balance sheet. Ensures PU’s profits factor in replacement laptop costs. PU will need to replace laptops after 3 years.

Straight line is useful when there is not a great variation in the actual value of the asset over time (such as the laptops in this case).

Straight line is generally better for lower valued items.

Award [1] for a general comment about the numbers rather than the usefulness.
Award [2] for a brief explanation that shows some understanding of the usefulness to PU.

Refer to Paper 1 markbands for 2016 forward, available under the "Your tests" tab > supplemental materials.

People

The university is entirely dependent on people:

• Customers: (students) are making judgements about the services and facilities that the university provides. They do this through surveys and through the guides for university choice. These are highly influential in lecturer appraisals and the choices that prospective students make.
• Lecturers: provide the core service of the university. The teaching quality depends on their skills and, more recently on their training for online courses. The research undertaken which is dependent on supervisors and research students.
• Support staff: students may not get adequate services.
• Management: Adriana plays a key role in decision-making and managing.
• Trustees: the strategic decision-makers.

Probably the most important people are the lecturers and students without whom the university would not exist.

Processes

This has changed drastically since the accident. From face-to-face teaching using dedicated resources such as buildings to online teaching and the use of temporary, non-specific resources elsewhere. The process has been highly rated in surveys.

The process also involves other services such as recruiting new students, and providing training for lecturers in online teaching. Support services are not as good as they could be.
The online teaching is a major change in how they operate.

Physical evidence

The campus was always beautiful and part of what attracted students to PU. It is now severely damaged. It will be important to restore the campus. Buildings facilitated PU’s teaching and research work. These will need to be restored. Issues such as sustainability could also be included, facilities such as solar panels, energy efficient classrooms could be built.

It could be argued that restoring the infrastructure of PU (the buildings and campus), in other words physical evidence, is the most important in the short term, but that, overall, people are critical, without these the processes will not be effectively delivered.

Accept reasonable alternative answers.

Marks should be allocated according to the Paper 1 markbands for 2016 forward section B.

Award a maximum of [4] for a purely theoretical answer or there is no effective use of case (e.g. only repeating case material without development).

Award a maximum of [4] for an answer that only explores the 4Ps of the marketing mix (price; promotion; place and product).

Award a maximum of [5] if only one element of the extended marketing mix is considered.

Award a maximum of [6] if only two elements of the extended marketing mix are considered.

Award a maximum of [6] if the extended marketing mix is considered but there is limited use of data or if there is good analysis of data with limited consideration of issues.

Award a maximum of [8] if all three elements of the extended marketing mix are considered and there is good use of data but there are no significant judgements.

Candidates had some understanding of contingency planning but often confused the concept with crisis management. There was a need to identify that 'contingency' happens before the event with 'crisis' happening after the event. Most candidates scored at least one mark for some aspect of planning that takes place.

Organizational culture was not well understood by all leading to a variety of responses to this question. Better answers focused on how culture changes after a major event with strong references to PU's situation. Weaker answers wrote generally about culture with only limited consideration of PU.

There was a pleasing number of candidates who were able to correctly calculate the annual depreciation using the straight line method. Candidates must be reminded of the need to show the units, in this case the dollar ($) sign.

This was generally less well answered though there was a mix from those who fully understood why calculating deprecation using the straight-line method would be useful to PU, to those who wrote generally about depreciation with no mention of PU.

This question generated a range of answers. As the question with the highest number of marks, it was important for candidates to have a good knowledge and understanding of the topic being covered. Sadly, this was not the case for all candidates with a larger number than we hoped writing generally about the 4 P's of the marketing mix with little or no reference to people, process or physical evidence. Better answers wrote at length about each of the extra P's in relation to PU. Weaker answers made no reference at all to the extra P's.