Practice IB Business Management Topic Unit 2: HR Management - Motivation, Structure, Hierarchy with authentic exam-style questions for both SL and HL students. This question bank focuses on the exact syllabus content for Unit 2: HR Management - Motivation, Structure, Hierarchy and mirrors Paper 1, 2, 3 style where relevant.
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LuminaCare
(a) With reference to Resource 3, one HR issue that may be impacting LuminaCare’s ability to scale sustainably.
(b) one financial challenge and one marketing challenge LuminaCare may face if it accepts the concessional loan.
(e) one problem that may arise from poor internal communication between departments.
(e) one way VerdeLeaf could improve internal communication to support motivation among staff.
(e) one limitation of bureaucracy in SkyGen’s previous structure
NexaHealth Equipment Ltd.
NexaHealth manufactures advanced diagnostic scanners for hospitals. Each scanner requires 72 imported components sourced using a just-in-time (JIT) model. NexaHealth spends £7.2 million annually on R&D, equal to 12% of its £60 million annual revenue, to maintain its innovation lead.
Last quarter, a global semiconductor shortage caused a six-week production delay, resulting in:
To manage this risk, the COO has proposed switching to a just-in-case (JIC) model for critical components, which would increase annual inventory holding costs by £1.5 million but reduce delay risk to below 1%. The operations team instead suggests investing £4.2 million in automation and adopting lean production and TQM practices to reduce dependency on external suppliers.
(a) the stock control method currently used by NexaHealth.
(b) how NexaHealth’s proposed JIC-based contingency plan could affect the business in terms of cost and risk.
(c) how NexaHealth’s proposed strategies (automation and adopting lean production and TQM practices) could help improve operational performance.
BeanBar Ltd.
BeanBar Ltd. is a medium-sized company that sells gourmet coffee beans online and in retail stores. The business recently launched a new premium coffee blend and carried out primary market research to better understand customer preferences before the launch. The findings helped inform the company's updated marketing plan, which included promotional discounts and revised packaging.
Although initial sales were strong, the marketing manager is concerned that poor internal communication between the finance and sales teams may be affecting financial performance. The finance team has noted rising costs, while the operations team wants to reinvest in product development.
Table 1 shows selected financial data for the past two months.
Table 1: Selected financial data for BeanBar Ltd. for 2024
| Item | Month 1 ($) | Month 2 ($) |
|---|---|---|
| Revenue | 100,000 | 90,000 |
| Cost of sales | 40,000 | 42,000 |
| Expenses | 30,000 | 35,000 |
| Net profit | ? | ? |
| Current assets | 60,000 | 50,000 |
| Current liabilities | 30,000 | 40,000 |
(a) the net profit for Month 1 and Month 2. Show all your working.
(b) the current ratio for Month 2. Show all your working.
(c) one reason why a fall in net profit might concern the finance team.
(d) one method of primary market research.
VerdeLeaf
VerdeLeaf is a worker co-operative that produces compostable packaging for small food businesses. All employees are members who share in profits and help make decisions. As the business grew, VerdeLeaf introduced a more formal functional organisational structure, which has created friction between departments.
The business’s original objective was to remain local and values-driven, but it has recently started supplying national chains. While some members support this shift, others worry it goes against VerdeLeaf’s founding purpose. Recent feedback suggests rising demotivation in the production team, especially due to poor communication across departments and inconsistent involvement in decision-making.
The finance team has provided partial data for Q1 2024 and tasked a trainee to complete the statement of profit or loss.
Table 1: Financial data for VerdeLeaf – Q1 2024
| Item | Amount ($) |
|---|---|
| Units sold | 4,000 |
| Selling price per unit | 6.50 |
| Variable cost per unit | 2.10 |
| Salaries (production + sales) | 38,000 |
| Marketing and promotion | 14,000 |
| Office rent and overheads | 16,000 |
| Tax rate | 25% |
| Dividends paid to members | 12,000 |
Figure 1: Statement of profit or loss (partially completed)
VerdeLeaf Statement of profit or loss
for the quarter ended 31 March 2024
(a) one challenge VerdeLeaf may face as it grows from a local co-operative to a national supplier.
(b) one external stakeholder and who may be interested in VerdeLeaf’s current situation.
(c) Using the data in Table 1, the blanks in the statement of profit or loss shown in Figure 1. Show all your working.
(d) what the statement of profit or loss suggests about VerdeLeaf's cost and revenue structure.
SkyGen Ltd.
SkyGen Ltd. is a software company that previously operated using a traditional hierarchical structure with centralized decision-making. After losing several talented developers, the company began restructuring project teams and moving toward a flatter matrix system.
SkyGen has also updated its performance appraisal process and begun introducing self-managed development plans. The HR director is piloting new methods for evaluating staff performance while linking role enrichment to innovation output.
Table 1. Statement of Financial Position: SkyGen Ltd. (as at 31 December 2023) (All figures in $m)
| Description | $m |
|---|---|
| Property, plant and equipment | 1,800 |
| Accumulated depreciation | (600) |
| Non-current assets | 1,200 |
| Cash | 300 |
| Debtors | 450 |
| Stock | 250 |
| Current assets | 1,000 |
| Total assets | 2,200 |
| Trade creditors | 200 |
| Short-term loans | 200 |
| Current liabilities | 400 |
| Long-term borrowings | 300 |
| Total liabilities | 700 |
| Net assets | 1,500 |
| Retained earnings | 1,500 |
| Total equity | 1,500 |
Additional information:
(a) units-of-production depreciation for the year
(b) SkyGen Ltd.’s debtor days.
(c) between summative and self-appraisal, using SkyGen Ltd. as context.
(d) how job enrichment and delayering might support SkyGen Ltd.’s move to a matrix structure.
(c) Using the resources and relevant business management tools and theories, recommend a plan of action for LuminaCare over the next five years. Your plan must make a clear recommendation on financing (choose Series A now, choose the concessional loan now, or propose a staged sequence using both at different times) and your choice.
(d) Using the stimulus and your knowledge of business management, which strategy NexaHealth should prioritise to improve operational resilience and long-term competitiveness. You may recommend one primary strategy or a phased approach, but you must make a clear first priority.
| Item | $ |
|---|
| Sales revenue | __________ |
| Cost of sales | __________ |
| Gross profit | __________ |
| Expenses: | |
| - Salaries | (38,000) |
| - Marketing and promotion | (14,000) |
| - Office rent and overheads | (16,000) |
| Profit before tax | __________ |
| Tax (25%) | __________ |
| Profit for period | __________ |
| Dividends | (12,000) |
| Retained profit | __________ |
