AQA BUSS4 Research Theme for 2015 - Manufacturing in the UK

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Chivalrous Thieves take a Chinese coach tour to the Strong Man Street Party

Tuesday, February 17, 2015

Which UK tourist attractions do you think each of the following names represents? (** see the end of this blog for a link to the answers)

•Big White Streaker

•Mountains Lakes Get You Drunk on Dreams

•Custom-made for Rich People Street

•Castle of Love from Outer Space

•Queen Avenue

And, my personal favourite, Forest of Chivalrous Thieves

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Dowty - phoenix from the ashes.

Sunday, February 15, 2015

Since 1937, Dowty have been building propellers for aircraft at its plant in Gloucestershire. However, a huge fire has destroyed much of its factory at Staverton, this unexpected event, highlights the need for contingency planning, and media management, but also represents a new opportunity to re-assess the operations side of production.

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Love in the air at the Golden Arches

Saturday, February 14, 2015

Valentine's Day seems a suitable moment to look at the campaign which McDonalds have been running in the US for the last fortnight. 20 to 30 customers have been selected each day in each store to receive the opportunity to avoid paying for their food, and 'pay with love' instead. Selected customers at pre-determined times, when they place and order, are asked if they want to "Pay with lovin" instead of with cash. This may sound slightly alarming; the demonstration of love which is required is to be determined by a member of McDonald's staff who is given responsibility for running the campaign in each restaurant, and who has the wonderful title of 'Lovin' Lead'. An extract from the Ts&Cs for the campaign states that: "Lovin' Acts will be designated by the Lovin' Lead and may include things like fist bumping the Lovin' Lead, calling a loved one, telling the Lovin' Lead what the Participant loves about their significant other, blowing a kiss, or other general sentiment or Lovin' Act in the theme of the Game, subject to Lovin' Lead's reasonable discretion and completed to Lovin' Lead's reasonable satisfaction". They then hope that the customer will post a selfie and spread the word for them.

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Offer your employees $2000 to quit!

Tuesday, February 10, 2015

An intriguing concept that seems to be catching on; Zappos (and now Amazon) give their new recruits “the offer”; telling the new workers that the company will pay them over $2000 to quit if they’re not sure they’ll be happy at the company.

Whilst it initially seems open to abuse, it’s actually a strategic masterpiece in which the advantages far outweigh the drawbacks. Thus far less than 3% of newbies have taken the offer, and so $2000 is a small price to pay to weed out the employees who are only there for the money. By contrast, those who decline the offer show that they are bought-in to the Zappos culture, which has led to Fortune ranking them amongst the best 100 companies to work for.

Attached is a research task that asks students to evaluate the above strategy and gives great infographics and articles which demonstrate the importance of culture and a happy workforce.

A fantastic concept for students to discuss and an amazing business to research.

Dowty Rising like a Phoenix from The Ashes?

Friday, February 06, 2015

Since 1937, Dowty Rotol have been building propellers for aircraft at its plant in Gloucestershire. Its output was for aircraft powered by Rolls Royce or Bristol aero engines. Earlier this week a huge fire destroyed much of its Staverton factory.

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How important is pay as a motivator?

Thursday, February 05, 2015

Does it make sense for a business to pay its staff as little as possible, in order to cut costs and be able to compete, or to raise wages in order to stimulate greater motivation, and gain employee loyalty? In part one of The Price on Inequality on Tuesday, Robert Peston was looking at the widening gap between the highest income earners and the rest of us, arguing that while income and wealth inequality was seen as 'almost a good thing in the 1980's', it is now being seen as almost the greatest economic problem facing us. An article in The New Yorker, 'The Return of Fair Wages', examines a similar theme, looking at a decision by an American company to substantially raise the wages of their lowest-paid employees. Since 2000, 'real' wages in the US have hardly changed, while many US employers are making decent profits and the incomes of the top 1% have risen by nearly 60%. Mark Bertolini, CEO of Aetna (a medical insurance company) has announced that the company’s lowest-paid workers will get a substantial raise—from twelve to sixteen dollars an hour, in some cases—as well as improved medical coverage. This article offers some interesting comment on why it is worth while paying employees a little more. 

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Bagged by the Dragons

Tuesday, February 03, 2015

Dragons Den is always worth watching - however familiar the format may be, the range of business ideas and experiences remains intriguing and entertaining. Last Sunday's episode had a brilliant example of a enterprise that was being re-launched after folding - Baggers Originals clothing, children's rainwear with a USP of its own built-in bag for storage, and to wrap up wet clothing at the end of a muddy walk (...does anyone remember having the originals as a child, or buying them as a parent?). 

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Sainsbury’s strategic link to fill those empty spaces

Saturday, January 31, 2015

Imagine that you are Mike Coupe, CEO of Sainsbury's. Like the other major supermarkets, you are facing a market which is being shaken up by the food discounters, and declining profit margins as you engage in a price war. There is a growing shift to online retail, and although you had a record number of customer transactions in the week before Christmas, with the top-end Taste the Difference range and Christmas jumpers doing particularly well, in common with your competitors sales were generally down over the festive period. At the end of last year you were forced to report a loss of £290m in the six months to September, and you estimate that within the next five years, a quarter of your stores will have empty floor space and will be too big for your needs. You need a strategy for survival, and to gain some stable income streams which will make use of the assets that you have. What should you do?

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iPopping profits for Apple

Wednesday, January 28, 2015

Apple's revenue in 2014 was £160bn. To put that into perspective, it is more than the GDP of Portugal. The £12bn profit that they made in the last three months of last year is the largest profit ever made by a company, and the equivalent of that made by Tesco in ten years - and in the 2.44 minute report about all this on the BBC news tonight, they made another quarter of a million pounds. 

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Supermarkets to “demand” loyalty from their loyalty card holders!

Saturday, January 17, 2015

A perfect (yet ridiculous) starter to introduce supermarket competitiveness. This Daily Mash mock-news-article lampoons the ironic concept of the “loyalty” card and highlights the desperate situation that the Big 4 are facing due to the unstoppable growth of the loyalty-card-less Aldi and Lidl.

It can be used as a spring board for discussions on customer loyalty, Unique Selling Points (or lack thereof), reliability of sources and strategies in the face of increasing competition.

To ensure students don’t quote the above article in their BUSS4 exam, below are some more serious ones from a reputable source!

Enjoy

BBC Sainsbury’s sales fall further

BBC Tesco to close 43 stores in the UK

BBC Morrison's introduce club card

BUSS4 UK manufacturing - Jaguar Land Rover expands

Wednesday, January 14, 2015

Good news for UK manufacturing this week, as Jaguar Land Rover announce a rise in sales of 9% globally, with a quarter of those going to China, a 7% rise in the UK, as Land Rover have their best ever year and Jaguar their best for a decade.

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Never mind the price cuts

Thursday, January 08, 2015

Headlines about Tesco's latest price cuts and trading figures (down by 0.2% on like for like sales)  mask some other significant actions. 

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How extraordinary, how exceptional, how unusual.

Monday, December 22, 2014

The run up to Christmas has been seen as a good time to bury bad financial news, however Tesco's auditors, Price WaterhouseCoopers now face an inquiry over the preparation and auditing of Tesco accounts from 2012 onwards. The Financial Reporting Council is the independent disciplinary body for UK accountants and actuaries.

It is possible that this inquiry could lead to pressure to break up the oligopolistic nature of auditing, currently dominated by 'The Big Four', viz.  Deloittes, Ernst & Young, KPMG and PWC. Ultimately it is up to the politicians to decide that this sector needs to be shaken up. 

2014 has been a particularly grim year for Tesco, and it's new CEO, Dave Lewis, still faces the challenge of restoring shareholder and customer confidence. 

Google V Audi – Differentiation for Driverless Cars

Sunday, December 14, 2014

The race to produce the best driverless car is on! Most of the automotive “big boys” are working on their versions, but it’s interesting to see the varied approaches taken by Google and Audi. Attached is a PowerPoint task that ask students to watch the 2 car “adverts” and analyse the risks and rewards of the different strategies.

Google are playing it safe, perhaps heeding the Harris Poll of 2,039 adults, in which 88 percent said they would be worried about riding in an autonomous, driverless car. Their car is round, cute, friendly and slow.

Audi have chosen another path… a much faster path! Their “piloted” car achieved speeds of 149mph and completed a lap of the Hockenheim F1 track a few seconds faster than the manned car.

Intriguing stuff that is certain to create great debate.

Have a fantastic Christmas!

UK Manufacturing - why did UK output fall by 0.7% in October?

Wednesday, December 10, 2014

Studying this year's research theme really requires students to have a solid understanding of the macroeconomic factors which affect the demand for products made by UK manufacturers. Yesterday, the ONS released the latest figures for changes in UK industrial output, which are worth spending some time on. Below I have extracted the key points of the ONS's report, and added some analysis of the reasons for the changes.

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UK Manufacturing and Porter’s Five Forces

The case of Premier Foods and the 'pay to stay' payments that they were extracting from their suppliers gives an opportunity to use the Porter's Five Forces model to analyse the food manufacturing industry in the UK. Last week, BBC's Newsnight carried a report about Premier Foods, who manufacture many key brands including Ambrosia, Mr Kipling, Oxo and Bisto.

The online report comes with a 5-minute video clip which sets up the topic nicely. Newsnight's Laura Kuenssberg interviews engineer Bob Horsely, who had a contract to supply maintenance services to Ambrosia's factory in Devon. He received a letter from Premier Foods saying that "We are aiming to work with a smaller number of strategic suppliers in the future that can better support and invest in our growth ideas. We will now require you to make an investment payment to support our growth." When he queried this, he received another letter: "We are looking to obtain an investment payment from our entire supply base and unfortunately those who do not participate will be nominated for de-list." In other words, pay up or we won't buy from you any more. 

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Inside Rolls Royce – Manufacturing in the UK

Sunday, November 30, 2014

A fantastic documentary for the Section A Research Theme (bullets 2, 4 & 5), that also ticks a great many boxes for the BUSS1, 2 & 3 specifications.

Channel 4’s Inside Rolls Royce charts the production of the Celestial (a one-off showpiece car that has more bling than Liberace, as well as an optional £20,000 picnic hamper!). It covers many topics within Human Resources, Operations, and Marketing, but my highlights are as follows:

  • The front of house manager who checks the length of the grass
  • The relentless quality control that almost breaks a man
  • The marketing of the new Rolls Royce Wraith in Abu Dhabi, which includes hand selected movers-and-shakers from the city getting to test drive it around the formula 1 track

The documentary is available via this link (if you don’t have a C4 account, it takes only 2 minutes to register) and I’ve created a  worksheet with 29 questions (numbers correspond to the minutes) intended to promote discussion about a brand synonymous with British excellence.

Hope it helps

The way to an employee’s heart - through his stomach?

Thursday, November 20, 2014

Would free food make you work harder? Google think that it would, and so do many other employers. Is it true that Google have a rule that no employee should ever be more than 150 feet from a food outlet in the office? There is the story in this article, of an employee in California who practically moved into the office, sleeping in his car just outside and living on the perks and extras available in the building, which he managed to do for a full 60 weeks. 

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Marketing and online hotel reviews - ‘free’ information?

Wednesday, November 19, 2014

If you are running a hotel these days, one of the most important aspects of your marketing mix must be the 'free' publicity that you get through review sites like TripAdvisor. Most of us would prefer to check the reviews posted by other travelers before booking a hotel we don't know - while you will always find some extreme views, the average rating and trend of the comments left are very helpful. So too are the responses that some of them add to the site, so that you can see how they deal with criticism. It takes 'word of mouth' marketing to a new level, and is not directly within the control of the hotel's management; the only thing they can do is be aware of the impression they are making on their clients, and try to ensure that their standards are fit-for-purpose and will generate the right sort of comment to encourage more travelers to choose them.

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How rich are you? (Teachers should be pleasantly surprised)

Monday, November 17, 2014

Based on the Channel 4 programme by the same name, I created this worksheet that asks students to predict the wages of various professions, and where they fall on the income distribution chart. They can then watch this short clip which gives them the answers, leading to great discussions and potential research on any of the following:

  • The taboo of wages and why we struggle to make accurate predictions
  • The rich-poor divide and Pareto’s Law
  • The importance of education
  • The determinants of wages
  • Taxes and benefits
  • Money and happiness

Hope it helps.

Tesco, and the pressures of a price war

There must have been a siege mentality at Tesco recently, as they are locked in hand-to-hand battle with Asda and Sainsbury, and find that they are outflanked by Aldi and Lidl. Whether that justifies some of the tactics being employed to regain the upper hand, or the financial relationships they have had with suppliers for the last few years, is being investigated by the Serious Fraud Office, and is increasingly coming under public scrutiny. What could be the worst outcome for them: a serious fine which erodes their already-battered budgets, a change in accounting practices forced on them by the outcome of the SFO investigation, a real shift in the supplier/buyer power relationship that has so far seen Tesco, the buyer, with huge advantage, or a significant change in public trust and their relationship with their customers? 

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UK Manufacturing - Supply Chains Need Strengthening

Sunday, November 09, 2014

The need for supply chains supporting UK manufacturing to be significantly strengthened has been highlighted by a new research report from the CBI and consultants AT Kearney.

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UK Manufacturing Competitiveness: The Threat from Energy Costs and Skills Gaps

An important contribution to the debate about the UK's industrial strategy was made by the CBI in October 2014 and much of what was said is directly relevant to students researching the opportunities and threats facing UK manufacturing.

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New entry to the discount supermarket segment

Thursday, November 06, 2014

If a business sees a market segment in which sales are predicted to double to the scale of 15% of the total market in the next five years, you would expect them to be quick to find ways to enter it. However, if you are Sainsbury's, and have a carefully nurtured image and market position to protect, you might baulk at rushing into the discount segment of the market, in case it interfered with that image or cannibalised your market.

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Manufacturing Competitiveness - Rolls Royce Takes Steps to Improve Operational Efficiency

Tuesday, November 04, 2014

Competitiveness - and specifically the need to be cost-effective - is at the heart of a significant announcement by one of the UK's most significant manufacturers Rolls Royce.

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Manufacturing - Printing a House

Sunday, November 02, 2014

Advocates of the transformative power of 3D printing (or additive manufacturing to give it the formal name) will be excited by this fascinating example of how it might be used in the near future. 

An architectural consultancy in the Netherlands is using 3D technology to build an entire house!

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Leadership and Strategy - Moya Greene at the Privatised Royal Mail

The strategic challenges facing Royal Mail and its renowned CEO Moya Greene are explored in this superb FT video report (below) from Andrew Hill which takes a look at Royal Mail just a year after the business was privatised.

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Manufacturing Technology - The Bendable Opportunity

A simply stunning video report here from the FT which introduces the work of an innovative UK manufacturer - Smartkem - which is looking to innovate in the emerging printed electronics sector.

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Technological Innovation - Impossible Food?

Can technology provide a viable, scaleable alternative to livestock farming? I must admit, after watching this report from Tim Bradshaw of the FT, that it looks like it could!

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Sony - Eyes the Wearables Opportunity

Facing intensive competition in the smartphone market, Sony is turning its attention to a different consumer electronics market - wearables.

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Court Out! Red Bull and other cases of false advertising

Friday, October 31, 2014

Prepare yourselves for a shock; Red Bull does NOT give you wings, and have had to pay over $13m in compensation for saying so. I would assume the latter statement caused more astonishment than the former, and so I looked into previous false advertising cases and compiled the attached game called Court Out.

There are 10 case of false advertising, students have to decide which businesses were “court out” and had to pay damages, which advertising campaigns “got away with it” and which one is an urban legend. On the final slide is Graham’s “Spectrum of Analysis” in which students must evaluate which ones they felt were the most or least culpable.

To prevent any class action law suits against me, I would say it is a relatively fun and engaging game that should promote discussion and evaluation and might help students understand the fine line between good marketing and mendacity*.

*learning not guaranteed but I hope it helps!

Manufacturing - Energy Costs and Competitiveness

Friday, October 17, 2014

Surveys of manufacturing businesses in the UK often ask what aspect of government policy would be most helpful to manufacturers. High up the list of priorities come a better-trained and educated workforce, lower taxes and greater financial incentives to invest in R&D. However, there is one factor that nearly always comes top - energy pricing.

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Luxury Goods - The Decline in Global Demand

It seems that all is not well in the global market for luxury goods. There is increasing evidence of a slowdown in demand for luxury products. One reason is slower economic growth in the emerging economies. The geo-political environment isn't helping either, with unrest in the Ukraine and Hong Kong contributing to consumer unease.  Add in the worries over the Ebola outbreak and a clampdown on public corruption in China - it is not hard to see why demand for luxury goods is weakening.

But, is there another underlying reason - are consumers also getting fatigued with some luxury brands?

This useful FT video explores the issues.

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Dr Dre V Jay-Z – Focus V Diversification

Wednesday, October 08, 2014

As we all know, the mean streets of my adopted home town of Solihull share many similarities with Dr Dre’s Compton and Jay-Z’s Brooklyn, so I always take a keen interest in their progress.

This PowerPoint task asks students to research two of hip-hop’s biggest stars, use Ansoff’s Matrix to organise the many roles and businesses that they are involved in and then discuss how their contrasting strategies have impacted on their net worth.

Is Jay-Z’s “empire [building] state of mind” the best strategy, or is Dr Dre’s focus on music “still” the way to make the most money? Students can use the evidence that they have collated to complete the evaluation question on the final slide.

Hope it helps!

Advertising bans - fun activity called ‘Wordsnake’ to test students’ recent knowledge

If you've noticed the story about the Wongo TV advert that was banned recently for failing to clarify the level of interest charged on their loans, you may find this activity of interest.  Using a technique called 'Wordsnake' developed by our own Graham Prior, the activity lists 5 businesses with adverts banned by the Advertising Standards Authority in 2014 (other than Wonga).

At first glance it appears to be a wordsearch as you see a grid of what appears to be 100 random letters. However, the name of the business 'snakes' around the grid rather than being up, down or diagonal as in a normal wordsearch.

Students are given a clue about the the business hidden in the grid. Who can be the first to spot the answer and call out its location?

If the answer is not obvious at first, the teacher can press the space bar and the letters reveal themselves one at a time. 

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Manufacturing in Action - The Kit Kat Supply Chain

Monday, October 06, 2014

This production line in York makes 5 million Kit Kat bars every day. What is involved in the manufacturing process? Have a break and take a look!

The short video focuses on the local sourcing of milk from Scotland which supplies the ingredient preparation (crumb) plant at Girvan. Reference is made to the concept of "food miles", an important idea linked to resource sustainability.

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Manufacturing: Does the UK Steel Industry Have a Future?

Thursday, October 02, 2014

The FT produce some superb videos that are ideal for use in the Business & Economics classroom - and this one on the UK steel industry is another excellent teaching resource - particularly for students researching UK manufacturing.

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BUSS4 UK manufacturing

Wednesday, October 01, 2014

As BUSS4 students start on their research into UK manufacturing, one piece of data that they should keep an eye on is the CIPS Purchasing Managers Index. This is produced monthly by the Chartered Institute of Purchasing and Supply by surveying managers responsible for purchasing materials in manufacturing industries, and so it gives an indication of the level of activity. A reading above 50 (shown by the red line on the graph above) shows growth in activity, below 50 shows a decline.

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Business start-ups - advice for fish fryers

Tuesday, September 30, 2014

BBC Radio 4 has a 5-part series this week which follows eight budding entrepreneurs on a course in Leeds, specialising in how to run their very own Fish and Chip shop. I caught the first episode yesterday; with each episode only 15 minutes long, it seems like a very good set of programmes for students who are beginning a Business studies course, as it covers a wide range of the issues that they will be learning about.

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How to increase your cash by 40% in one day – buy shares in Alibaba!

Wednesday, September 24, 2014

The Chinese internet giant, ran by former English teacher Jack Ma, has become the biggest initial public offering (IPO) in History.

Having studied them last year, I considered buying shares in them, hemmed-and-harred, and didn’t. What a mistake! Shares started at $68 and rose to $92.70, an increase of 38%. Had I invested my spare £5mil (left-overs from the Apple shares I bought in 1999), I would have been up by a cool £1,900,000!

I used this as a way to introduce Public Limited Companies, but also linked it to risk and reward, raising finance and working out percentage increase.

Here is the link to a previous research task on Alibaba (suitable for most BUSS4 topics) and the more current BBC news article.

Hope it helps

Tesco’s fall from grace

Tuesday, September 23, 2014

Tesco's share price slid again today, although the firm has announced that the new Finance Director Alan Stewart started work three months earlier than expected. 

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Every little counts against Tesco

Monday, September 22, 2014

News about Tesco's troubles comes thick and fast, today's bad news about overstating profits has wiped off 11.59% of the share price. It fell by 26 pence to £2.03.  

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Networked Manufacturing - The Complexity and Culture of Global Production

A fascinating video here from the excellent Peter Marsh of the FT which explores the complexity of manufacturing operations at the world's largest eyewear maker Luxottica.

You probably haven't heard of Luxottica, but you will almost certainly be familiar with their broad product range. Luxottica's best known brands are Ray-Ban, Persol and Oakley. It also makes sunglasses and prescription frames for a multitude of designer brands such as Chanel and Prada, whose designs and trademarks are used under license.

In total, Luxottica is estimated to have around 80% of the global market for eyewear. It is also a vertically-integrated business with over 7,000 retail outlets around the world, many them trading under the Sunglass Hut brand.

Luxottica has six plants in Italy and two in China.

In the video, Peter Marsh introduces the concept of networked manufacturing. This concept is explained further by this excellent Economist article. The close integration of marketing (new product development & brand / product portfolio management) with operations is a key theme explored in the video.

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Choosing a Business Location: Manufacturing in South-east Asia?

Where should multinationals base their manufacturing operations? What are the risks involved in changing location? How can these risks be mitigated? 

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Lesson Activity - Cashflow-Cluedoh!

Thursday, September 18, 2014

Cashflow Cluedoh!, our free murder mystery game for business teachers, has just reached the 20,000 download level! Grab this popular lesson activity below.

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The Young Millionaire’s Dilemma

Wednesday, September 17, 2014

An interesting and inspirational story for all AS Business Studies students. Nick d’Aloisio wrote an app called Summly at his parents’ home when he was 15. At 17 he sold it to Yahoo for £20million. He now works for the internet giant in California, project managing the rebranded app News Digest… whilst still sitting his A-level exams!

The young entrepreneur is now deliberating whether or not to go to University. Attached is a short research task with videos and articles that asks students to create a balanced, evaluative argument about the pros of cons of Nick going to university. They must then apply the same question to themselves to see how the reasons differ.

It works well to introduce the key skills of application, analysis and evaluation, whilst learning about one of the UK’s most successful young entrepreneur.

Business Simulation - The Trading Game

Friday, September 12, 2014

There is nothing that better epitomizes the concept of being entrepreneurial than trading - buying and selling - hopefully profitably!

That's the idea behind The Trading Game - an interactive teaching and learning resource developed by tutor2u.

To request your free copy of The Trading Game simulation, please submit the following form and we will automatically send you the download link

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The Business of Religion

Wednesday, September 10, 2014

As an interesting way to introduce 3 of the 4 functional areas (and illustrate to students that business studies concepts are everywhere), I used these 3 news stories about how different religions have changed their strategies this year.

Pope Francis stamps out corruption in the Vatican Bank - By refusing to “do business” with certain unscrupulous customers, the profit at the Vatican Bank has dropped from £68m euros to just £2.3m. A strong move from Il Papa, but should a church make any profit at all?

Jehovah’s Witnesses change their marketing strategy - Instead of the door-to-door approach, Jehovah’s witnesses are trying to increase awareness of (and recruitment to) their “brand” by targeting train stations and shopping centres. Will this new tactic prove successful?

Church of England vote for women bishops - Traditionalist believed that as Jesus only “employed” male apostles, only men should lead the church. A recent vote has put an end to this misogyny, but one member of the church said “This is a show for the media. It's the end of the Church as we know it”. Should the church be exempt from the Sex Discrimination Act?

The lesson has now ended. All go in peace.

The Perfect BUSS1 Video – Steve Jobs Billion Dollar Hippy

Monday, September 08, 2014

The story of Apple, from inception up until 2011, is told beautifully in this 50 minute BBC documentary (available on Netflix or via this link) and literally covers all 15 sections in the BUSS1 specification (and quite a few from BUSS2 too). As an added bonus, I’ve created this 30-question worksheet to keep students focused.

A fantastic insight into one of the biggest companies in the world, a ready-made lesson... and chance for you to put your feet up for an hour!

Hope it helps!

Technology & Manufacturing - Innovation in Diesel Engine Design & Production

A great video here from the Royal Institution which illustrates how technology and manufacturing move together through the process of new product development.

The location for the video is a JCB engine factory and our guide explains how technological change impacts on the development of the next generation of high-powered diesel engines.

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