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1.6 Growth and evolution

Unit 1.6 - Growth and evolution

Learning outcomes

This section of the IB Business Management syllabus examines the growth and evolution of businesses. Almost all businesses strive to grow, whether this is measured in terms of sales revenue, profits, number of stores / outlets, number of employees or market share.

Businesses often have to evolve their practises and/or products in order to survive (see Box 1 below). For example, although Samsung is best known for its smartphones and consumer electronic products, the multinational conglomerate is also involved with weapons manufacturing, life insurance and theme park management. Samsung originally started traded as a grocery store.

The learning outcomes (or assessment objectives) for this section of the syllabus are:

  • Economies and diseconomies of scale (AO2)
  • The merits of small versus large organizations (AO3)
  • The difference between internal and external growth (AO2)
  • The following external growth methods (AO3):
    • mergers and acquisitions (M&As) and takeovers
    • joint ventures
    • strategic alliances
    • franchising
  • The role and impact of globalization on the growth and evolution of businesses (AO3)
  • Reasons for the growth of multinational companies (MNCs) (AO3)
  • The impact of MNCs on the host countries (AO3)

Case Study - The evolution of famous products and brands

Have a go at this starter quiz with your students. What was the original intended commercial purpose for each of these brands or products?

Brand / product

Original purpose

7-Up

bipolar disorder

Bubble Wrap

wallpaper

Coca-Cola

medicine to help relieve exhaustion

Duct Tape

waterproof tape for repairing military equipment

Frisbees

containers for pies

Hugo Boss

military uniforms

Listerine*

anti-septic for cleaning floors

Play-Doh

wallpaper cleaner

Ray-Ban

anti-nausea and headache sunglasses for pilots

Viagra

heart problem and low blood pressure

* According to Freakonomics, sales revenue increased from $115,000 to more than $8 million within 7 years of rebranding Listerine as an oral healthcare product.

InThinking Business Management resources

Click the hyperlinks below to access the InThinking resources for this particular section of the IB Business Management syllabus.

Return to the Unit 1 Business organization and environment homepage

 

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