The difference between cost and profit centres

Exploring the IB Business and Management syllabus provides a clear view of the skills and knowledge you'll acquire throughout the course. Join us as we unpack the key concepts of the syllabus, giving you a better understanding of what to expect on your learning journey.

The IB Business and Management syllabus consists of 5 units:

Business and Management

In this unit you will explore the following:

Introduction to business management

Primary, secondary, tertiary and quaternary sectors

Challenges and opportunities for starting up a business

What is a business?

Distinction between the private and the public sectors

The main features of the following types of organizations. — Sole traders

The main features of the following types of organizations. — Partnerships

The main features of the following types of organizations. — Privately held companies

The main features of the following types of organizations. — Publicly held companies

The main features of the following types of for-profit social enterprises. — Private sector companies

The main features of the following types of for-profit social enterprises. — Public sector companies

The main features of the following types of for-profit social enterprises. — Cooperatives

The main features of the following type of non-profit social enterprise. — Non-governmental organizations (NGOs)

Types of business entities

Common business objectives including growth, profit, protecting shareholder value and ethical objectives

Business objectives

Stakeholders

Internal and external economies and diseconomies of scale

The difference between internal and external growth

External growth methods. — Mergers and acquisitions (M&As)

External growth methods. — Joint ventures

External growth methods. — Strategic alliances

Growth and evolution

Suggested inquiry statements to explore — How corporate social responsibility (CSR) could impact business creativity.

Suggested inquiry statements to explore — Why business objectives might change over time.

Suggested inquiry statements to explore — How ethical behaviour contributes to business sustainability.

Suggested inquiry statements to explore — Why change could bring conflict among stakeholders.

Suggested inquiry statements to explore — How businesses could benefit from adopting circular business models.

Multinational companies (MNCs)

Human resource management

Internal and external factors that influence human resource planning (for example, demographic change, change in labour mobility, immigration, flexi-time, gig economy)

Reasons for resistance to change in the workplace

Human resource strategies for reducing the impact of change and resistance to change

Introduction to human resource management

The following terminology in relation to different types of organizational structures. — Delegation

The following terminology in relation to different types of organizational structures. — Span of control

The following terminology in relation to different types of organizational structures. — Levels of the hierarchy

The following terminology in relation to different types of organizational structures. — Chain of command

The following terminology in relation to different types of organizational structures. — Bureaucracy

The following terminology in relation to different types of organizational structures. — Centralization

The following terminology in relation to different types of organizational structures. — Decentralization

The following terminology in relation to different types of organizational structures. — Delayering

The following terminology in relation to different types of organizational structures. — Matrix structure

The following types of organization charts. — Flat or horizontal

The following types of organization charts. — Tall or vertical

The following types of organization charts. — By product, by function or by region

Appropriateness of different organizational structures given a change in external factors

Changes in organizational structures (for example, project-based organization,

Charles Handy’s “Shamrock Organization”) (HL only)

Organizational structure

Scientific and intuitive thinking/management (HL only)

The following leadership styles. — Autocratic

The following leadership styles. — Paternalistic

The following leadership styles. — Democratic

The following leadership styles. — Laissez-faire

The following leadership styles. — Situational

Leadership and management

The following motivation theories. — Taylor

The following motivation theories. — Maslow

The following motivation theories. — Herzberg (motivation–hygiene theory)

The following motivation theories. — McClelland’s acquired needs theory (HL only)

The following motivation theories. — Deci and Ryan’s self-determination theory (HL only)

The following motivation theories. — Equity and expectancy theory (HL only)

The following types of appraisal (HL only). — Formative

The following types of appraisal (HL only). — Summative

The following types of appraisal (HL only). — 360-degree feedback

The following types of appraisal (HL only). — Self-appraisal

Internal and external recruitment (HL only)

The following types of financial rewards. — Salary

The following types of financial rewards. — Wages (time and piece rates)

The following types of financial rewards. — Commission

The following types of financial rewards. — Performance-related pay (PRP)

The following types of financial rewards. — Profit-related pay

The following types of financial rewards. — Employee share ownership schemes

The following types of financial rewards. — Fringe payments

The following types of non-financial rewards. — Job enrichment

The following types of non-financial rewards. — Job rotation

The following types of non-financial rewards. — Job enlargement

The following types of non-financial rewards. — Empowerment

The following types of non-financial rewards. — Purpose/the opportunity to make a difference

The following types of non-financial rewards. — Teamwork The following types of training.

The following types of non-financial rewards. — Induction

The following types of non-financial rewards. — On the job

The following types of non-financial rewards. — Off the job

Motivation and demotivation

Types of organizational culture, for example, Charles Handy's “Gods of management” (HL only)

Cultural clashes when organizations change, including but not limited to, when organizations grow and merge and when leadership styles change (HL only)

Organizational (corporate) culture (HL only)

Formal and informal methods of communication for an organization in a given situation

Communication

Approaches to conflict in the workplace by: — employees—collective bargaining, work-to-rule and strike action

Approaches to conflict in the workplace by: — employers—collective bargaining, threats of redundancies, changes of contract, closure and lockouts. The following approaches to conflict resolution.

Approaches to conflict in the workplace by: — Conciliation and arbitration

Approaches to conflict in the workplace by: — Employee participation and industrial democracy

Approaches to conflict in the workplace by: — No-strike agreement

Approaches to conflict in the workplace by: — Single-union agreement

Suggested inquiry statements to explore — How technological advancement could help businesses manage their human resources depar a more efficient way.

Suggested inquiry statements to explore — How creative organizational structures can be more suitable in the dynamic business wo

Suggested inquiry statements to explore — Why a democratic style of leadership is one way of encouraging creativity in a busines

Suggested inquiry statements to explore — The impact of financial motivation on employees’ sustainable behaviour.

Suggested inquiry statements to explore — How effective communication could impact business success.

Suggested inquiry statements to explore — Why ethical and sustainable organizations are more likely to recruit top talent and ha employee retention.

Industrial/employee relations (HL only)

Finance and accounts

Role of finance for businesses. — Capital expenditure

Role of finance for businesses. — Revenue expenditure

Introduction to finance

The following internal sources of finance. — Personal funds (for sole traders)

The following internal sources of finance. — Retained profit

The following internal sources of finance. — Sale of assets The following external sources of finance.

The following internal sources of finance. — Share capital

The following internal sources of finance. — Loan capital

The following internal sources of finance. — Overdrafts

The following internal sources of finance. — Trade credit

The following internal sources of finance. — Crowdfunding

The following internal sources of finance. — Leasing

The following internal sources of finance. — Microfinance providers

The following internal sources of finance. — Business angels

Appropriateness of short- or long-term sources of finance for a given situation

Sources of finance

The following types of cost, using examples. — Fixed

The following types of cost, using examples. — Variable

The following types of cost, using examples. — Direct

The following types of cost, using examples. — Indirect/overhead

Total revenue and revenue streams, using examples

Costs and revenues

The purpose of accounts to different stakeholders

Final accounts — Profit and loss account

Depreciation using the following methods (HL only). — Straight line method

Depreciation using the following methods (HL only). — Units of production method

Appropriateness of each depreciation method (HL only)

Final accounts

The following profitability ratios. — Gross profit margin

The following profitability ratios. — Profit margin

The following profitability ratios. — Return on capital employed (ROCE)

Possible strategies to improve these ratios

The following liquidity ratios. — Current ratio

The following liquidity ratios. — Acid test (quick) ratio

Profitability and liquidity ratio analysis

The following efficiency ratios. — Stock turnover

The following efficiency ratios. — Debtor days

The following efficiency ratios. — Creditor days

The following efficiency ratios. — Gearing ratio

Debt/equity ratio analysis (HL only)

The difference between profit and cash flow

The relationship between investment, profit and cash flow

Strategies for dealing with cash flow problems

Cash flow

Investment opportunities using payback period, average rate of return (ARR) and

Investment appraisal

The importance of budgets and variances in decision-making

Suggested inquiry statements to explore — How cost and revenue management could ensure sustainability.

Suggested inquiry statements to explore — Why final accounts analysis could be essential in changing stakeholder perspectives.

Suggested inquiry statements to explore — Why profitable businesses may face insolvency.

Suggested inquiry statements to explore — How time value of money affects future consumer choice.

Suggested inquiry statements to explore — How triple bottom line accounting can support the shift towards more ethical busines

Budgets (HL only)

Marketing

Market orientation versus product orientation

The importance of market share and market leadership (HL only)

Introduction to marketing

Segmentation, targeting (target market) and positioning (position maps)

The difference between niche market and mass market

The importance of having a unique selling point/proposition (USP)

How organizations can differentiate themselves and their products from competitors

Marketing planning

The benefits and limitations of sales forecasting

Sales forecasting (HL only)

Why and how organizations carry out market research

The following methods/techniques of primary market research. — Surveys

The following methods/techniques of primary market research. — Interviews

The following methods/techniques of primary market research. — Focus groups

The following methods/techniques of primary market research. — Observations

The following methods/techniques of secondary market research. — Market analyses

The following methods/techniques of secondary market research. — Academic journals

The following methods/techniques of secondary market research. — Government publications

The following methods/techniques of secondary market research. — Media articles

The following methods/techniques of secondary market research. — Online content

The difference between qualitative and quantitative research

The following methods of sampling. — Quota

The following methods of sampling. — Random

The following methods of sampling. — Convenience

Market research

The relationship between the product life cycle, product portfolio and the marketing mix

The relationship between the product life cycle, investment, profit and cash flow

The following aspects of branding. — Awareness

The following aspects of branding. — Development

The following aspects of branding. — Loyalty

The following aspects of branding. — Value The importance of branding Price The appropriateness of the following pricing methods.

The following aspects of branding. — Cost-plus (mark-up) pricing

The following aspects of branding. — Penetration pricing

The following aspects of branding. — Loss leader

The following aspects of branding. — Predatory pricing

The following aspects of branding. — Premium pricing

The following aspects of branding. — Dynamic pricing (HL only)

The following aspects of branding. — Competitive pricing (HL only)

Collections

Physics

Biology

Chemistry

Budgets (HL only)

Syllabus concepts to know

Suggested inquiry statements to explore

Study & practice 3.9 Budgets (HL only)

Practice 3.9 in Question Bank

Read Notes for 3.9

Review 3.9 Flashcards