Business Studies F297 Ocr ApsL 2014 Strategic Management Revision Question

23.) Should APSL invest in the energy saving device? (Suggested in line 89-96)

In 2013, APSL’s statistical figures show the business spending much of it’s overheads (“almost half) towards overheads. Consequently, Peter and Kate have discovered a device which allows wasted heat from presses to contribute towards a fraction of APSL’s hot water costs. Despite the obvious long term savings that will be derived from this investment, APSL will need to consider how this decision will influence other aspects of their business such as objectives and their corporate social responsibility.

First of all, APSL will need to evaluate how this costly investment of £250,00 will impact the ability of APSL successfully achieving its objectives. Currently, APSL have set two ten year strategic objectives- one of which being to expand their export market to an overall 15%. In order to do this, APSL will need to spend a lot of money marketing and exporting to countries outside the EU and therefore this particular investment in an energy saving machine may mean that APSL have insufficient funds to effectively fulfill this objective to the maximum potential. Therefore, it may not be a good decision in the short term for APSL to invest in a costly energy saving machine when it may hinder APSL’s ability to achieve their goals.

Secondly, APSL will need to evaluate the actual benefits that can be derived from this machine. Despite the device claiming to save 4% per year, Peter believes that the financial return may be to low to cover the cost of the expensive machine. Rightly so, it could be argued that the device does not provide a sufficient return on the investment and thus Peter correctly criticises the machine for taking too long to “repay itself.” Additionally, this investment could also trigger some cash flow issues. If the money taken to pay for the machine will be retained profit – it is a possibility that APSL may experience issues in their forecast. For example, if external influences such as the economy mean that APSL aren’t making their predicted budget, APSL will have less money than thought to cover the costs for the rest of the month. Thus, by investing in this costly piece of machinery, APSL may not have enough retained profit in order to cover contingencies within the business. Furthermore, if APSL decide to take out a loan to buy the machine, they will need to explore the often hefty price tags attached to taking out loans which essentially may leave APSL in a worse place (spending more money paying for the piece of equipment, rather than saving as intended.) APSL will need to evaluate their financial status extensively before pursing the device as it may prove as a catalyst to further problems rather than solutions at APSL.

John is also critical of the decision of the capital expenditure being based on solely quantitive factors. Therefore, it is also important that APSL evaluate the other factors outside of profits and numerical figures in a way that they might benefit. One way APSL may benefit from the device externally is benefitting from their corporate social responsibility. By utilising a machine that is able to use excess heat from presses by converting it into the heat meeting hot water requirements, APSL is able to be more economically sustainable and thus help the environment. Customers may view APSL’s investment as being socially responsible for the environment by playing an active role in their responsibility. Ultimately, if APSL do invest in this device-it means that they gain good word of mouth through positively helping the environment and thus it is likely to benefit the overall customer loyalty to APSL.

It appears that APSL have taken a lot of responsibilities on at once such as trying to move to a new factory, purchasing new machinery and introducing a third time shift. The evidence suggests that due to this, it will be beneficial for APSL to hold off on the investment of buying new machinery, as the financial aspects as well as the current objectives should play a dominant focus currently in the business. It is clear that the machine will provide benefits in the long term; however APSL will not be able to waste time that is required to physically benefit from this capital investment.

Wuthering Heights Timeline : life, death, age and context.

An Extremly useful timeline of life death and external influences in Wuthering Heights.

 

Year Date Characters Ch External Ages
1757 June Hindley Earnshaw born      
1757 August Ellen Dean born      
1760       George III becomes king  
1762 January Edgar Linton born     Hindley 4
1764 July Heathcliff born     Hindley 7; Ellen 6; Edgar nearly 2
1765 May Catherine Earnshaw born     Hindley nearly 8; Ellen 7; Heathcliff 11 months
1765 October Isabella Linton born     Edgar 3
1771 August Mr Earnshaw brings Heathcliff to Wuthering Heights 4   Hindley 14; Ellen nearly 14; Heathcliff 7; Catherine 6; Joseph 41
1773 May Mrs Earnshaw dies 4   Hindley 15; Ellen 15; Heathcliff 8; Catherine 7
1773 16 Dec.     Boston Tea Party  
1774 October Hindley is sent off to college 5   Hindley 17; Heathcliff 10; Catherine 9
1776       American Declaration of Independence  
1777 October Mr Earnshaw dies 5   Hindley 20; Ellen 20; Heathcliff 13; Catherine 12
1777 October Hindley returns to Wuthering Heights with Frances 6   Frances 17
1777 November Catherine stays at Thrushcross Grange 7   Hindley 20; Ellen 20; Edgar 15; Heathcliff 13; Catherine 12; Isabella 12
1777 Christmas Eve Catherine returns to Wuthering Heights 7    
1778 June Hareton Earnshaw is born 8   Hindley 20; Frances 18; Heathcliff 13; Catherine 13
1778 September Frances dies 8   Hindley 21; Frances 18;
1780 August Heathcliff runs away from Wuthering Heights 9   Hindley 23; Ellen 22; Heathcliff 16; Catherine 15
1780 August Mr and Mrs Linton die 10   Edgar 18; Isabella 14
1783 March Catherine marries Edgar 10   Edgar 21; Catherine 17
1783 August Cathy is conceived     Edgar 21; Catherine 17
1783 September Heathcliff returns 10   Edgar 21; Heathcliff 19; Catherine 18; Isabella almost 18
1784 January Heathcliff clashes with Edgar 11   Edgar 21; Heathcliff 19; Catherine 18
1784 February Heathcliff marries Isabella 12   Heathcliff 19; Isabella 18
1784 March Heathcliff and Isabella return      
1784 20 March Catherine dies giving birth to Cathy 16   Edgar 22; Heathcliff 19; Catherine 18
1784 September Linton Heathcliff is born 17   Isabella 18
1784 September Hindley dies 17   Hindley 27; Joseph 54
1789       Start of French Revolution  
1796       First smallpox inoculations  
1797 July Cathy meets Hareton at Wuthering Heights 18   Hareton 19; Cathy 13
1797 July Isabella dies 17   Heathcliff 32; Isabella 31; Linton 12
1797 July Linton is taken to Thrushcross Grange and then Wuthering Heights 19   Linton 12
1800 20 March Cathy meets Heathcliff and Linton 21   Heathcliff 35; Hareton 21; Cathy 16; Linton 15
1801 August Cathy marries Linton 27   Hareton 23; Cathy 17; Linton 16
1801 August Edgar dies 28   Edgar 39
1801 September Linton dies     Cathy 17; Linton 17
1801 November Mr Lockwood visits Wuthering Heights 1   Heathcliff 37; Hareton 23; Cathy 17; Ellen 44; Joseph 71
1802 January Mr Lockwood returns to London 31    
1802 April Heathcliff dies 34   Heathcliff 37; Hareton 23; Cathy 18
1802 September Mr Lockwood returns to Thrushcross Grange 32   Hareton 24; Cathy 18
1803 1 January Cathy marries Hareton     Hareton 24; Cathy 18
1805       Battle of Trafalgar  
1807       Slave trade abolished  

Business Studies F297 Revision – Apsl case study Ocr

Discuss the appropriateness of APSL’s 10 year strategic objectives.

In order to become a successful business, APSL understands the need of having updated objectives to ensure that they are constantly meeting the demand of the market and gaining the best return on their investments as possible. APSL currently intend on improving their solvency as well as expanding their export market by 15%. However, considering the current financial issues that APSL appear to be experiencing, APSL need to ensure that they carefully consider the implications of their objectives and assess the appropriateness of their aims.

Currently, a large consumer of APSL’s products is the caravan business in the UK. Correctly, APSL have recognised that the majority of caravans produced that source APSL’s products tend to remain in the UK, therefore- the caravan business does not directly help APSL reach their objective of expanding their exports to the external markets by 15%. If APSL are serious about meeting their 2018 objective of increasing their exports, they will need to consider businesses that will help them reach their target. The evidence suggests that APSL should focus on businesses such as car companies to help meet their objectives, as they have correctly realised that car companies that source APSL’s products are more likely to export the final product to outside of the European Union. Therefore, one suggestion could be that APSL no longer supply to the caravan companies, and make a direct focus on the exporting markets. However, with all business decisions- this could derive a number of implications. If APSL decide to stop or limit their dedication to providing to caravan businesses in the UK, it could mean that they experience a significant loss of profits and orders. APSL need to recognise that the UK market has been a major factor for their success and therefore, if APSL begin to neglect them for overseas consumers, it may not be the best decision. Additionally, APSL may find that they are unsuccessful in meeting their targets of expanding their exposure to the international market by 15% and therefore they would have lost a significant customer in the UK market. Although APSL should focus heavily on the international market if it wishes to reach its objective, they will need to assess the impacts of their sacrifices.

Additionally, APSL intend on improving their solvency ratios in their 10 year strategic objectives. APSL will need to consider the cut backs they will need to make to improve their solvency ratios such as on machinery or staff payments. Currently, APSL pay staff a competitive 10% over other manufacturing skilled staff. Inevitably, this is likely to impact the amount of net profit that APSL are left over with in order to make the company less solvent. However, making cutbacks on staff salaries will also cause implications such as unhappy staff. It could be argued that making cutbacks on pay is not the most moral thing to do, as staff may have initially signed up to APSL due to their competitive rates of pay. On the other hand, it may be the wisest thing for APSL to consider doing in order to make cutbacks to widen their profit margins to make the business most solvent. If the staff of APSL are unhappy with the changes, APSL will need to inject more money in to the business finding appropriate staff and recruiting the right people for the job as well as training them. However, APSL may find that through recruiting new staff, they have exposed themselves to people with fresh ideas and people that are likely to be more motivated as they still want to work for APSL despite the average salaries that they are now offering.

Certainly, APSL’s objectives could be said to be ‘too far out of reach.’ Essentially, this means that APSL appear to be taking on too many projects at once. Currently, the evidence suggests that APSL are considering new heat efficient machiney, moving to a location in Hull and introducing a new night shift. It could certainly be said that APSL need to focus on one objective at a time or else the company could be impacted negatively through diseconomies of scale. Often when a business tries to take on too much at once, it derives a number of complications such as poor quality across the board as well as  no clear focus or direction in which way the business is heading. Although allowing 10 years for APSL to meet these objectives might appear fairly realistic, when combined with the other projects that APSL intend on committing to may mean that they will hinder the overall direction of the business.

Indeed, APSL have created objectives that are appropriate in meeting the needs of the business. If APSL make appropriate decisions that have clear focus such as cutting back on spending and committing to directly related business they will then be able to achieve their 10 year strategic objectives.

F297 BUSINESS STUDIES APSL OCR REVISION

Discuss the extent to which different stakeholders might be able to influence APSL’s possible relocation decision?

APSL’s current decision to move to hull will have a significant impact on the business’ stakeholders. Inevitably, the decision will not suit all stakeholders and therefore APSL will need to analyse who’s interest in the business they prioritise most in order to influence their possible relocation decision.

Shareholders Kate, John and Peter are likely to be keen on the move to Hull for a number of reasons. For one, communication is likely to improve as a result of moving to a 20,000 factory where all sites are under one roof, in comparison with the current three site operating system. This will improve communication in APSL as it means that information can be more easily spread through workers and can be delivered to the right place. This is the case with supplies “trying to deliver just in time to the wrong unit” which resulted in last year’s production being halted three times. Thus, by moving to a location where everything is closely linked together- suppliers can deliver to one property without the hassle of distinguishing which one of three is the correct one. Ultimately, this is likely to improve the efficiency of APSL as customers will receive their products much faster by ruling out the delay of supplies being delivered to the wrong place and thus delaying the whole process.

However, shareholders will also need to analyse the risk factor involved. Certainly, it is likely that this decision will impact the most. The three main shareholders Kate, Peter and John have collectively created two long term objectives and therefore it may mean that by moving to their factory in Hull, they may not be able to afford to maintain their two other objectives. For this reason, the shareholders will need to assess their financial accounts to see if they are able to afford the move. Currently, APSL’s accounts show that they are not making as much profit compared to last year and therefore it might mean that APSL have less retained profits to work with and invest to a number of projects at once. The evidence suggests that APSL should halt all major decisions and focus on where money should be correctly spend whether it means holding back on moving to Hull and investing in marketing to the export market.

Additionally, creditors will be another major influence when APSL decide whether to relocate to Hull. Due to the loss of profits from last year to this year, by _______ APSL may find that they have less retained profits to cover the cost of moving. After all, it is not just the building that APSL will have to purchase. The move to Hull may mean that APSL need to consider specialised shipping to dismantle machinery, and may well also have to negotiate or find new suppliers that are willing to travel an extra 80 miles to and from Hull to deliver materials to APSL- which may result in adding extra charges to current prices. Overall, APSL has less money to invest into the new property and therefore will need to explore other sources of finances. APSL will need to assess the likelihood of creditors giving the business a loan. It is likely that creditors may not want to give out a loan due to being weary of not gaining it back due to the risk implications that moving causes and therefore APSL will need to consider if they can afford/find a right creditor to subsidise them. However, if APSL do find a creditor that is willing to give APSL a loan, they will need to consider the rate of interest that they are offering upon paying back and therefore decide if the additional cost of interest is worth it. Creditors are likely to impact APSL’s decision of moving immediately or slowing down the process until they are able to afford it through selling assets and retained profits without taking out a loan.

Currently, employees are paid a competitive 10% over all other semi-skilled staff in the area. Therefore it is likely that staff will be concerned about their job and may not want to move outside their home to support the business. If APSL move, it means that employees will need to travel a total of 80 miles to reach and get home from the new location. Expectedly, this move will not be desired by all staff and therefore APSL will need to consider the further implications that may arise.

If the majority of APSL staff does not wish to move to the new location, it means that Kate, John and Peter will need to find employees in a new area. Certainly, this adds to the further cost implications of spending time and money finding new and reliable staff that will need to be trained to the expectations of APSL’s high quality assurance. This means that by moving, APSL may end up having to spend more money than saving in the long run.

Finally, the community will play a big part in APSL’s decision to move to a new location. Currently, APSL are experiencing issues with community seen in figure 1 (Mr.Gilman’s letter) where 15 tonnes of plastic and other industrial waste has been dumped. If Hull find out about the unethical dumping of APSL currently, it is likely they will protest against it and therefore will be harder for APSL to secure the new factory at Hull. However, it is likely that the community of Hull will assess the benefits of having such a large business move into the area. If APSL do move to the new factory in Hull, they will need to be aware of the potential amount of jobs that will be created for possible suppliers and employees and thus the community will be pleased with the unemployment rate in the area reducing despite the high level of industrial pollution that will arise if a business such as APSL move into the area.

APSL will need to consider a number of stakeholders when deciding whether to relocate to the new factory in Hull. However, the true stakeholders that should be trusted with choosing to relocate should be Kate, John and Peter. If they believe that they have the finances to relocate, as well as the level of planning that will be needed to ensure that most employees are content with the decisions: they should certainly go ahead with the plans as they are the most knowledgeable and experienced when it comes to APSL.

A2 Business Studies OCR F297 Revision – Apsl Case Study

Hi. Some people on TSR have asked me to post some of my essays that I have done so far on the business APSL (JUNE 2014 F297). I don’t know if it will help anybody but a few people have asked me to give an example of the kind of responses I write after seeing my English essays that I post on this blog too. These questions have been suggested by the APT pack but the answers are my own.

Evaluate how specific objectives might contribute to the success of APSL?

APSL have widely expressed their ten year strategic objectives that they aim to achieve by 2018: these consist of expanding their export market by 15% and improving their solvency ratios. Certainly, there are many advantages associated with setting specific objectives such as providing a suitable way of measuring these objectives have been met, however it is also reasonable to argue that specific objectives may be too rigid to suit the ever-changing economy.

Firstly, APSL aim to improve their export market to countries outside of the EU to a total of 15% by 2018. APSL have created time specific and measureable objectives by ensuring they have a set target (15%) and a timeframe they believe is suitable (2018.) Indeed, by setting SMART objectives, APSL have set targets in place that they will be able to monitor the progress of. For example, in 2016; APSL will be able to look at the percentage of exports they currently produce and thus track if they’re on track for meeting their aims. For instance, if APSL recognise that their current exports are at 13% for 2016, it is likely that they are slowly making their way to their final target and therefore know their current strategic methods of reaching their target are working and therefore APSL can recognise what they need to continue to ensure more improvements. However, if APSL recognise that their targets are only at 8%, they will be able to place tactical aims to meet their long term objective such as sign new contracts with export markets alongside their current agreements. Undoubtedly, having specific objectives will mean that APSL have a quantifiable measure to track the progress of their objectives and identify what needs to be done to ensure they meet them.

However, there are many implications to implementing such specific targets. It could be argued that if APSL foresee the business is not on track on meeting their 2018 objectives, it is likely they will introduce short term tactical objectives to ensure they are on target. Inevitably, these short term tactics may not always help “the bigger picture.” APSL’s specific objectives are likely to put pressure on owners Kate, Peter and John to meet objectives and therefore cause them to make rushed decisions to ensure they meet them on time. For example, if APSL see that they have not been able improve their solvency ratios, it may lead to making quick decisions such as making a number of staff redundant or cutting back on staff salaries which will work in a downward negative spiral meaning APSL may have not made the right choice for the business as a result of being over pressurised. Therefore, having specific objectives could lead to managers making irrational decisions to meet them on time. Ultimately, it could be argued that having specific objectives are too rigid instead of having less specific objectives that allow managers to change them to the suitable economy. Thus, if APSL had set less rigid objectives, they will be under less pressure to meet them and therefore would allow themselves to constantly make changes to objectives as time passes e.g reduce their targets when experiencing a recession.

Nevertheless, the benefits from setting specific objectives for APSL cannot be ignored. Certainly, setting such targets will likely to increase motivation in staff at APSL. Although it could be seen as adding extra pressure, the evidence suggests that by having set objectives, staff have a visible form of motivation to work towards when staff morale is low. If APSL have objectives that have a clear direction, it means that staff will have an opportunity for appraisal. For example, if the employees of APSL work hard towards reaching their 10 year strategic objectives, the owners at APSL may want to increase their pay/providing appraisals and fringe benefits to appreciate the staff. Although the objectives that APSL have set appear to be targeted specifically at the top of the hierarchy (within the managers and owners) the employees can also contribute to objectives such as operating more efficiently to improve their solvency ratios by ensuring that the business will have more money and become more solvent through saving more on wastage. Thus, if APSL have specific objectives it is likely that staff will be motivated to achieve them as these objectives are a direct measure of staff performance and therefore APSL’s overall presentation.

As previously expressed, introducing specific objectives cannot always be a good thing for a business. However, APSL have set objectives that appear achievable and therefore will be advantageous. Due to staff already achieving an overall 10% salary above other manufacturing staff in the area, they are likely to be a lot more motivated to ensure that these targets are met and therefore, specific objectives will be a dominant factor in ensuring the success of APSL.