Leaving Cert Business Notes
Applied Business Question
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ABQ – Applied Business Question
The Applied Business Question is a key component of the Business Paper. It is a case study
based on a business scenario. Every year the units examined on the ABQ rotate.
The units examinable for 2014 are units 1, 2 and 3. It is worth 80 marks from a total on the
paper of 400 marks.
Students must ensure they are well practiced in technique for the ABQ.
The Technique
Being fully familiar with units 1, 2 and 3. See hand out on key learning outcomes for each unit.
Note there will be long questions in Section 3 on these units also. Therefore they should be
known thoroughly.
Time management. No more than 36 minutes should be spent on the ABQ.
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Follow the SEE Approach – State it, Explain it, Give an example – in this case a quote from the
Case Study.
You must quote in each part of your answers on the case study
Quotes must be relevant to the point you have stated and explained.
The SEE Approach – should also be used when answering long questions in Section 3
How many points to write?
Unless the question asks for a specific number of points, divide the marks for the part of the
question by five. For example 20 marks = four points to write. This technique should also be
carried out when answering long questions.
Sample answer - ABQ from 2009 “Renewable Energy
Solutions (RES) Ltd
Illustrate using examples from the above text, four enterprising characteristics/skills shown by
Liam. 20 marks
State: Risk taker
Explain: An entrepreneur is a person who takes calculated risks in order to achieve their goals.
They are not afraid of failure once they have their idea researched.
Explain/Quote:
“Liam identified a niche in the market for an Irish supplier of solar panels”
Interpersonal Skills
This is a person who has excellent people skills. They can motivate and get the most from their
staff. They take action and offer guidance to solving conflicts before they get overly complicated.
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“Liam has emailed all staff informing them of action to be taken swiftly if the business is to
survive”.
Self- motivated
Entrepreneurs are driven people who are self-motivated and take initiative themselves. They
are extremely hard working individuals who are driven by achieving their goals.
“Liam is an electrical engineer and established the business himself after attending a Trade Fair
in Germany with his previous employer”.
Leadership Skills
Being a leader is important in business. A leader motivates employees and can be there to
handle crisis and direct employees during challenging times.
“Liam implemented a 10% pay cut with immediate effect” in order to ensure the business
survives.
Discuss three types of management control that you would
recommend Liam put in place to secure the future of RES
Ltd. 30 marks
Management control is vital to ensure the business stays profitable and meets customers’
expectations and needs. There are four types, Financial, Credit, Stock and Quality.
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1.Financial
Financial control is managing the finances of the business effectively. The financial controller
should prepare regular accounts, budgets and ensure all taxes are paid on time. Any borrowing
requirements should be identified as soon as possible.
“Liam’s bank manager and a number of private investors were happy to provide the necessary
finance”.
2.Credit
Credit control should be carried out by the Credit Controller and ensures that debtors pay on
time and creditors are paid in a timely manner also. Ideally debtors should paid first and
creditors soon after to ensure there are no cash flow issues for the business.
“Cash flow is tight and Liam is particularly concerned by the fact that two of his largest
customers have not paid their bills on time”
3.Stock
Stock control involves having the “optimum” levels of stock – not too much and most importantly
not too little”. The correct stock levels at the right time help the business achieve their sales
targets. Regular stock takes should be carried out and the strategy JIT (just in time) ensures
stock arrives just when it is needed.
“Rising stock levels in the warehouse are also causing problems”
Overall, if Liam can ensure effective management control of the above areas he will reduce the
risks RES Ltd are currently facing.
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(i) Describe, using the above text, one possible nonlegislative and one legislative solution for industrial relations
problem facing RES Ltd.
(ii) In your view how should Liam have dealt with the issue to
lessen the likelihood of an industrial relations conflict?
(30 marks)
Non – Legislative solution- Negotiation
Negotiation would involve talking the matter through in-house among management and
employees. This would attempt to resolve the conflict facing RES Ltd. A face to face meeting
rather then email would be a better form of communication for issues facing the company.
“Liam has e-mailed all staff informing them that action will need to be taken swiftly”
A union is in place for the employees and Liam could perhaps meet with the shop steward and
follow the grievance procedure. An effective grievance procedure will help solve problems
quickly and fairly between management and employees.
“the staff have contacted their trade union”
Legislative solution – Labour Relations Commission
The LRC is a state agency that helps solve disputes between groups of employees and
management. The LRC was set up under the Industrial Relations Act 1990 and offers a
conciliation service, a rights commissioner an Industrial relations advisory service and helps
draw up codes of practice for businesses. In recent times they have worked with Aer Lingus to
help solve their industrial relations issues.
For RES Ltd. the LRC can assist with the conflict over the proposed pay cut and potential
redundancies. Liam surely wishes to avoid industrial action from his employees.
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It should be noted the LRC services are not legally binding. If disputes are not solved, the LRC
may refer the case to the Labour Court. Known as the court of “last resort”.
“to avoid the introduction of compulsory redundancies”
“staff concerns and agree a response to the pay cut proposed by Liam”
(ii) I think Liam chose the wrong method of communicating sensitive information about a pay cut
to his employees. I feel he should have called a face to face meeting with the employees, airing
his concerns for the future of the business. Liam should have fully informed employees about
the financial difficulties facing the business. This would have allowed employees an opportunity
to think about the reasons for the proposed pay cut.
“ Liam has e-mailed all staff informing that action will need to be taken swiftly”
Secondly, Liam may have suggested to employees that the pay cuts could be reversed if the
financial affairs of the business improve next year. This would have offered employees hope
that the situation is only temporary. Liam could have also worked more closely with the shop
steward in communicating information.
“the past year, however, has been difficult for the business”.
Teachers Comments
Please note the SEE Approach is used throughout the solution
Quotes are used after each point made.
Practice, Practice, Practice: The ABQ weekly to improve time management and technique.
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