Business Studies HSC

Generalised Business + Marketing + Operations

What are the main functions of a business?

The primary functions of a business are marketing, operations, human resources, and finance. These functions work together to satisfy the needs and wants of consumers by producing goods and services, enabling businesses to achieve goals such as profit, growth, and market share.

How do goods and services differ?

Goods refer to tangible products that can be physically owned (e.g. clothing, phones), while services refer to intangible products and involve an activity or benefit provided to customers (e.g. healthcare, transport, education.

What are the four main business functions?

The four primary business functions are marketing, finance, operations, and human resources. Each function contributes to achieving overall business goals through coordination and interdependence.

How do businesses contribute to employment, income, and innovation? 

Businesses employ people by offering jobs, generating income through wages and salaries. Businesses drive innovation by developing new products, technologies, or processes to meet changing customer needs. These contributions stimulate economic growth and improve living standards

How can businesses be classified by size, ownership, and industry?

Micro (<5 employees)

Small (5-19 employees)

Medium (20-199 employees)

Large (>200 employees)

Sole trader, partnership, private company, public company.

Primary, secondary, tertiary, quaternary, quinary. 

What is the difference between private and public companies?

Private companies (Pty Ltd) allocate shares privately to chosen individuals and can have up to 50 shareholders. Public companies are listed on the ASX, and can sell shares to the public. There is no limit on the number of shareholders a public company can have, increasing access to capital.

What are the key features of micro, small, medium, and large businesses? 

Micro (<5 employees) - often owner-operated, limited revenue

Small (5-19 employees) - simple structure, limited formal processes

Medium (20-199 employees) - more formal management and specialisation

Large (>200 employees) - complex hierarchy, access to greater capital and marketsloyees) - more formal management and specialisation

What are the advantages and disadvantages of sole traders and partnerships?

Advantages: full control over decisions, simple setup, minimal legal requirements.

Disadvantages: unlimited liability (personal assets at risk), limited access to capital, and business continuity depends on owners’ involvement.

What are the main external influences on a business (PESTLE)?

The main external influences on a business are political, economic, sociocultural, technological, legal, and environmental factors. They affect how a business operates and makes decisions, but are largely outside of its control.

What is the impact of technological change on operations and marketing? 

Technology improves efficiency and quality in operations (e.g. automation, robotics, digital inventory systems) and enhances market reach through digital advertising, data analytics, and social media, enabling more targeted promotion and customer engagement.

How do social influences shape business goals and products? 

Social influences, such as changing lifestyles, demographics, values, and ethics, influence customer preferences. Businesses adapt by developing sustainable, inclusive, or ethically sourced products and aligning their goals with social responsibility to maintain reputation and competitiveness.

What are the main legal and political influences on business decisions? 

Legal: compliance with employment laws, WHS, anti-discrimination, and consumer protection.

Political: government policies on taxation, trade, environmental regulations, and monetary policy that affect business operations and planning. 

How does competition influence business strategies?

Competition can influence business strategies, driving businesses to innovate, improve quality, and differentiate their products or services. Firms may develop unique selling propositions (USPs), adjust pricing strategies, or enhance customer service to gain or maintain market share.

What are the main stages of the business life cycle? 

Establishment: starting operations, building awareness.

Growth: increasing sales, expanding market presence.

Maturity: stable sales, maximising efficiency.

Post-maturity: renewal, decline, or steady state.

What internal and external factors cause business decline? 

Internal: outdated technology, outdated marketing material, poor management, poor financial control, and high costs.

External: increased competition, economic downturns, changing customer trends, and new regulations.

What strategies can help a business achieve growth?

Strategies businesses may utilise to achieve business growth are market development (expanding into new markets), product diversification, globalisation, innovation, and strategic alliances. Effective use of the four business functions - marketing, operations, finance, and HR supports sustainable business growth.

What is the role of operations in achieving business goals? 

The role of operations is to transform raw materials (inputs) into finished products (outputs) efficiently and effectively. Operations help a business achieve goals such as profitability, growth, and improved market share by ensuring products are produced at the right quality, cost, and time to satisfy customer needs.

How does operations interact with other business functions? 

Marketing identifies consumer demand, informing production volumes and product features.

Finance allocates budgets for equipment, materials, and labour.

Human resources manages and trains staff involved in production.

Together, these ensure products are produced efficiently and aligned with market demand. 

What are the main influences on operations management (e.g. globalisation, cost-based competition, quality expectations)? 

Globalisation - allows access to global suppliers and markets.

Technology - improves efficiency and product quality.

Quality expectations - customers expect reliability and consistency.

Cost-based competition - businesses must minimise costs to remain competitive.

Legal regulations - such as WHS and environmental protection laws.

Environmental sustainability - pressure to use sustainable resources and reduce waste.

Government policies, economic conditions, and corporate social responsibility (CSR) also shape operational decisions. 

How does technology influence operational efficiency?

Technology may influence operational efficiency by automating processes, improving communication, and increasing productivity. For example, robotics streamline production, reduce errors, and lowers long-term costs, allowing faster output and higher consistency.

What environmental sustainability and legal regulations affect operations? 

Environmental sustainability requires businesses to reduce waste, use renewable resources, and limit carbon emissions. Legal regulations, such as Work Health and Safety (WHS), Fair Work Act, and environmental protection laws, require businesses to maintain safe workplaces, fair labour practices, and environmentally responsible operations.

What are the inputs, transformation processes, and outputs in operations? 

Inputs: raw materials, labour, equipment, technology, and information.

Transformation processes: activities that add value, such as manufacturing, assembly.

Outputs: final goods or services delivered to customers.

What is the difference between transformed and transforming resources? 

Transformed resources refer to resources that have undergone transformation and are finished products. Transformation resources refer to tools and enablers of change (facilities and human resources).

What is sequencing and scheduling?

Sequencing refers ot the order in which activities occur in the production process.

Scheduling refers to the timing of when each activity will occur to ensure deadlines are met.

Tools like Gantt charts and Critical Path Analysis (CPA) are often used to manage these.

What are the main approaches to quality management?

Quality Control (QC): inspecting outputs to detect defects.

Quality Assurance (QA): ensuring systems and standards prevent defects.

Total Quality Management (TQA): continuous improvement where all staff are responsible for the quality of products and services.

How do businesses handle inventory management?

Just-in-Time (JIT): ordering materials only when needed to reduce storage costs.

Just-in-Case (JIC): holding buffer stock to avoid shortages.

Last-in-First-Out, First-in-First-Out (LIFO/FIFO): may also be used to track stock movement.

What are the main performance objectives of operations? (e.g. quality, speed, dependability, flexibility, cost) 

Quality - producing reliable, defect-free goods.

Speed - minimising time between order and delivery.

Dependability - delivering on time and meeting expectations.

Flexibility - adapting to market or design changes.

Cost - managing production to minimise expenses while maintaining quality.

How can businesses use technology and outsourcing as strategies?

Technology: businesses adopt innovations such as automation, robotics, and e-commerce systems to improve speed, accuracy, and cost-efficiency.

Outsourcing: contracting external specialists for tasks (e.g. manufacturing, IT, logistics) to reduce costs and focus on core activities, though it can reduce control over quality. 

What is the strategic role of marketing? 

The strategic role of marketing is to achieve profit maximisation by developing, pricing, promoting, and distributing a specific product that satisfies customer needs. Marketing establishes and maintains customer relationships and ensures the business remains competitive in dynamic markets.

How does marketing help achieve business goals? 

Marketing helps achieve business goals by increasing sales, market share, and brand awareness. By identifying and satisfying customer needs through efficient marketing strategies, businesses can improve profitability, growth, and customer loyalty - all of which align with broader financial and strategic goals. 

How does marketing interdepend with other business functions?

Operations: marketing identifies what products customers want, directly influencing production design and quality.

Finance: marketing activities require budgets and aim to generate sales revenue.

Human Resources: marketing success often depends on skilled, customer-focused staff.

All functions work together to achieve consistent brand positioning and business growth.

What psychological, sociocultural, economic, and government influences affect marketing?

Psychological: consumer perceptions, motives, attitudes, and brand loyalty affect decisions.

Sociocultural: family, social class, culture, and peer groups influence buying behaviour.

Economic: economic conditions (boom/recession) affect customer purchase power.

Government: laws and regulations (e.g. competition, consumer protection) restrict misleading or deceptive marketing.

How does consumer law protect customers?

Consumer law, mainly enforced under the Competition and Consumer Act 2010, protects consumers by ensuring fair trading and ethical marketing. Key provisions include:

• Deceptive and misleading advertising

• Price discrimination

• Implied conditions

• Sugging

How does ethical marketing influence brand image?

Ethical marketing, such as truthful advertising, environmental sustainability, and fair pricing enhances a business’s reputation and trustworthiness. This can increase brand loyalty, attract socially conscious consumers, and give a competitive advantage over unethical rivals.

What are the main stages of the marketing process?

• Situational analysis: using SWOT and product life cycle analysis.

• Market research: collecting and analysing information on customers and competitors.

• Establishing market objectives: e.g. increasing market share, brand awareness.

• Identifying target markets: selecting market segments to focus on.

• Develop marketing strategies: implementing the marketing mix (4Ps).

• Implementation, monitoring, and controlling: assessing performance and making adjustments. 

What is a SWOT analysis, and how is it used in marketing? 

A SWOT analysis is a way for businesses to understand their strengths, weaknesses, potential opportunities, and threats. SWOT analysis is used in marketing to help identify internal capabilities, external challenges, and ensure strategies like product launches or promotional campaigns are aligned with the business’s position in the market.

What are the steps in developing a marketing plan? 

1) Situation analysis

2) Market research/segmentation

3) SMART marketing objectives

4) Developing marketing strategies using the 4Ps

5) Implementation, monitoring, and control

How is marketing performance monitored and controlled? 

Marketing performance is monitored and controlled using performance indicators, such as sales analysis, market share, and profitability. If results differ from goals, corrective actions like adjusting pricing or promotion are taken to improve outcomes.

What are the 4 Ps (product, price, place, promotion)? 

Product refers to the product itself: Design, quality, branding, packaging.

Price refers to the price at which the product will be sold. Methods such as cost-based, market-based, or competition-based pricing.

Place refers to how the product will be visible to consumers and where it will be sold. Getting the product to consumers via physical stores or online platforms.

Promotion refers to the type of marketing effort, e.g. advertising, collaboration, product placement, etc.

What pricing strategies can businesses use? 

Cost-based pricing, which involves selling it higher price than production cost. 

Competition-based pricing, which involves selling based on how much competitors sell for. 

Market-based pricing which is based on customer demand.

Penetration pricing involves setting low initial prices to enter a market.

Price skimming, which involves setting high prices initially, then lowering later.

Loss leaders involve temporarily lowering prices to attract new customers.

What are the key elements of the promotion mix?

Advertising - paid mass media communication (TV, online).

Personal selling - direct interaction with customers to build relationships.

Sales promotion - short-term incentives (discounts, free samples).

Public relations - improving brand image through media coverage.

Word of mouth - informal customer-to-customer influence.

How do global marketing strategies differ from domestic ones? 

Global marketing adapts to cultural, legal, and economic differences across countries. Global marketing strategies involve standardisation, where a business does not change its marketing approach, or customisation, where a business adapts its marketing approach to the area it is in.

What is product differentiation and why is it important?

Product differentiation is when businesses modify new or existing products in ways that differ from competitors, creating a unique product. This can be achieved through unique features, quality, design, or brand image. It is vital as it helps attract consumers, build brand loyalty, and gain a competitive advantage in saturated markets.