Case Study 1: Alton Towers

Alton Towers was voted the UKs number one theme park again this year. It
is located in the heart of England in Staffordshire, where there is easy access
from both the M1 and M6, although access through the village of Alton
towards the site is difficult. The roads are narrow and there are twisting
bends, which coaches find difficult to manoeuvre round.

Alton Towers: questions

1. (a) Alton Towers set out to be the market leader. Explain what

this means.

(b) What evidence is given in the case study to suggest Alton

Towers is achieving its objective of being market leader? (1)

2. (a) State two advantages Alton Towers gained by being part of

the Tussauds group? (2)

(b) Name one other Tussauds attraction. (1)

3. Explain how Alton Towers kept ahead of the competition in the years
from 1982 until present. (2)

4. Explain the benefits to Alton Towers of having restaurants and

souvenir shops dotted around the site? (3)

5. Why does Alton Towers use differentiated prices for their admission
tickets? (3)

6. Explain how Alton Towers can use field research and desk research

to find out if they are achieving their objectives. (4)

7. Lately there has been a lot of adverse publicity in the press

concerning accidents on white-knuckle rides on the Pleasure Beach,
Blackpool. Do you think this adverse publicity could have an effect on Alton
Towers Theme Park? Explain your answer. (3)

8. Give two examples of how Alton Towers can promote itself as a safe
park to visit. (2)

9. State one advantage for Alton Towers of selling tickets on the

 internet. (1)

10. Give one advantage for customers of purchasing tickets on the

internet. (1)

Alton Towers: suggested solutions

1. (a) Market leader keeping ahead of the competition, first with

ideas, etc.

(b) Biggest attraction in UK and largest flume in 1982.

2. (a) Access to more finance, access to more marketing expertise.

(b) Madame Tussauds Waxwork Museum.

3. Years 1982 present by introducing more exciting rides e.g. largest

flume (1982), Nemesis (1994), Oblivion (1998), Hex (2000) and themed hotel
in 1996.

4. By diversifying into shops and restaurants Alton Towers will generate

more profits, souvenirs reinforce brand name, restaurants all around the
park prevents queues and customers having to walk far.

5. Prices are differentiated to encourage visitors to the site on less

busy days; to encourage families to come; to offer promotional prices for
certain days that may be less busy.

6. Field research questionnaires can be given to visitors to hand in or

send back, visitors can be asked questions by researchers going round park.

Desk research information about new rides can be gathered from

suppliers/designers. Information can be collected regarding other theme
parks (globally).

7. Adverse publicity could have a knock on effect on Alton Towers.

People might feel that white-knuckle rides are all dangerous. This could
result in fewer visitors to the park.

8. Alton Towers can promote itself as a safe park to visit by focusing on

its safety record over the years, and any safety certificates they have
obtained. They could make safety a main feature for any future rides, and
advertise this fact.
9. Alton Towers selling on the internet more opportunity for extra
sales.

10. Customers now prefer purchasing online more convenient e

Case Study 2: The Royal Mail Processing Centre, Edinburgh

The Royal Mail is part of the Post Office Group. The Post Office is a public
corporation. The Royal Mail is responsible for providing the posta l service in
the United Kingdom. The Royal Mail operates one of the cheapest and most
efficient postal services in Europe. A major reason for this is because in
1997 it invested 200m in computerised sorting machinery.

Stage 1 cancelling (CFC)

Stage 2 coding (MTT)

Stage 3 sorting (LSM).

The Royal Mail Processing Centre, Edinburgh: questions

1. The Post Office is a public corporation. What does the term public
corporation mean? (1)

2. (a) Describe two internal stakeholders in the Post Office. (2)

(b) Describe two external stakeholders in the Post Office. (2)

3. Explain one objective that the Post Office may have. (2)

4. The Royal Mail Processing Centre is an example of flow production.

(a) Explain why the Centre is an example of flow product ion. (1)

(b) Why is sorting letters and packets suitable for flow

production? (2)

(c) Give another example of flow production (1)

5. The Royal Mail uses a specialist database containing postcodes.

(a) Explain what a database is. (1)

(b) Describe two other ways in which databases could be used in

business (4)

6. Describe three costs and three benefits of using information

technology at the Royal Mail Processing Centre. (6)

7. Explain how the individual postman/womans rounds have been

 affected by technology? (2)

The Royal Mail Processing Centre, Edinburgh: suggested solutions

1. A public corporation is part of the public sector. It is owned and

financed by the government.

2. (a) Possible internal stakeholders could be employees (e.g.

machine operators who depend on the company for wages etc.); managers
(who supervise the processing and make decisions about investment etc.);
trade unions (who represent workers and negotiate pay and conditions on
their behalf).

(b) Possible external stakeholders could be the government (who

puts up the money and expects it to be used well); taxpayers (who expect to
see their money being properly used); customers (who wish an efficient
value for money service).

3. Possible objectives include providing a cheap and efficient service to

customers (many customers will be taxpayers and, as a public corporation,
quality of service is very important to the Post Office); covering costs (public
corporations do not have to earn profits but the Post Office must not lose
money and must ensure it has funds for investment).

4. (a) This is an example of flow production because a large number

of items are processed in the same way on an assembly line system in this
case a conveyor belt.

(b) The items are standard (i.e. letters); the tasks involved are
routine and easily broken down into component parts; the same processes
have to be carried out for each letter or packet; it is possible to identify
problems (e.g. letters with unclear postcodes); a large volume of items m ust
be processed; items must be processed quickly. Effectively, this is the
equivalent of mass production for mass consumption.

(c) Examples could include any product manufacturing process

involving an assembly line, for example, cars; electronic goods; food
manufacture; brewery bottling plant.
5. (a) A database is an electronic filing system which carries
information on a large number of items.

(b) Databases could be used in business as follows:

Employee records in this way it is easy to find out

information on age, training, salary level, years of service and so on.

Customer records this can be used for marketing purposes

for example, a mail shot; market research (who buys what), and so on.

Designs where business uses a number of different designs

for products, information on components, etc, can be held on a database.

Stock records stocks can be kept on a database for

example, part numbers etc, and employees can find out what is in stock at
any time.

6. Costs initial costs of installation/maintenance costs, breakdown

costs, training costs for operators, etc.

Benefits increased productivity, less waste, improvement in

working environment etc.

7. Walksorts for postmen and postwomen are made up using a specialist

software database program. These can be made up in two days instead of
the manual system of six weeks. This may mean that routes change quickly
depending on volume of mail. Postman and women may have to become
accustomed to changes of rout
Case Study 3: Soled Out?

Background

T-Sole Ltd produce fashion boots and industrial footwear, which are sold under the brand
name of MDs. This footwear brand can only be bought in specialist retail outlets throughout
the UK or from their own shop, which is situated in the heart of London.

During the mid 1980s to the mid 1990s the company achieved huge
successes. Their footwear range was particularly popular with the
student segment of the market, because of their durability. Sales
to other segments of the market were also increasing, as were their
profits.

Soled Out?: questions

1. Challenges for business can come from internal and/or external pressures.

Explain two such pressures affecting the current situation of

T-Sole Ltd. (4)

2. Explain the stages in the product life cycle of the MDs footwear

brand and state which stage it is now at. (8)

3. Employee relations at T-Sole Ltd suffered because of the new payment system.
Explain what the Human Resources Department of T-Sole Ltd could have done to avoid these
problems. (4)

4. In todays competitive markets quality products are extremely important. Explain

what measures T-Sole Ltd could have introduced

to ensure a high quality product reached the consumer. (4)

Soled Out?: suggested solutions

1. Internal pressures could include:

Workforce unwilling to continue with present working conditions.

Lack of training in making casual footwear.

Lack of finance to adapt existing machinery/buy new machinery.

Existing shareholders who will have reduced dividends.

External pressures could include:

Market is already near saturation lots of competition.

Political e.g. introduction of the minimum wage (i.e. laws protecting people at work).

Economic any change to interest rates could affect loan repayments of machinery/factory
etc.

Social changing attitudes to pollution/green issues/animal rights e.g. ensuring it is only man
made fibres used in production.

Technical -use of the internet for faster communications, etc.

2. Product Life Cycle

Development/introduction product is being designed

Introduction when product is new on market.

Sales are usually low at this stage.

Length of stage varies according to product.

Growth product is becoming established

Consumers are more aware of its existence.

Sales start to increase as more consumers buy it.

Product starts to make a profit.

Maturity/saturation product has become fully established

Sales are at a maximum.

Product has a huge market share.

No more sales growth possible unless product changed in some way.

Decline sales start to decline possibly because of more competition

Product is no longer required by consumers.

Product is forced out of the market.

MDs is in the decline stage.

3. The human resources department could have:

prepared job descriptions (specifications) for the organisati on

prepared person specifications used these to match to the job description

offered more than one days training perhaps an induction training to emphasise the culture
of the organisation

used a better system of remuneration to ensure all employees we re paid fairly

had a better system for the whole recruitment and selection process

introduced a staff appraisal system emphasising how this could help promotion/pay etc

introduced a formal grievance and discipline procedure

4. Measures to ensure quality:

Introduce a quality control programme.

Introduce Total Quality Management system

Monitor the production process at each stage to eliminate substandard goods.

Give the workers more responsibility for ensuring quality/solving production problems.

Introduce quality circles.

Investigate how your competitors maintain quality (benchmarking).