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IB Business Management Paper 3
A focus on social enterprises

This is a new exam for the IB Business exams starting in 2024, so students and teachers will be wondering how to prepare for it.  The IB provided guidance is obviously the best place to start, but see below for my thoughts on preparation.

An intro assignment idea for teachers

As students are being introduced to Paper 3, IB Biz developed an outline assignment, in which students break down a P3 case study by creating a thesis, annotating it with links to the course syllabus, comment on how they would use each of the resources on the case study, and outline a 2 step plan to put the social enterprise on a sustainable path. The goal here is to get students to practice the tasks they'll need for Paper 3 before doing a full 17 mark essay.  See this assignment sheet if you would like to introduce Paper 3 with a similar assignment.  The doc below is the paper that I would give students along with a case study to outline their answers. 

Preparing for Paper 3

Step 1: Research and understand social enterprises

Social enterprises in a nutshell - what are they?

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It’s important to note that there is not 100% agreement on what a social enterprise is, and even the IB guidance acknowledges this and gives us an overview of some common aspects of the definition.  Before preparing for Paper 3, I highly recommend starting with the IB document called “Guidance for External Assessment,” and finding the section on Paper 3. Also,here’s a good article that quickly summarizes 6 different types of social enterprises and gives links to examples.  It’s a great starting point to build students’ understanding.  The SEWF foundation has a good checklist of its standards for verifying social enterprise status. 

 

Here are some of my main takeaways on social enterprises from the IB guidance and other research: 

  • Has a focus on a mission or vision. (Investopedia notes that social objectives are the “primary purpose.”)

  • Has a mix of funding from revenue-generating business activities and some from grants, donations, and other non-revenue sources.  The IB draws a line at having “up to” 75% of funding from revenue generating activities, but I am not necessarily finding that all other sources agree with this limit.  Would a business that gets 100%

  • They DO NOT generate all of their funding from grants, donations, and non-revenue sources.  That would essentially make them a charity, and not considered a social enterprise. Revenue generation must aid the financial sustainability of the organization.

  • Any profits/surplus are reinvested into the social mission.  This is a key aspect in differentiating social enterprises from companies that simply have a strong CSR focus.

 

Some links to just a few examples of social enterprises that I have found while researching for the Paper 3 case studies.  I’d of course recommend doing some of your own digging around for examples of organizations: 

In the US

Fair trade social enterprises
India
Canada

Australia

Scotland

The UK generally

Ireland

Step 2: Understand the Paper 3 questions

Questions and marking: 

According to the Paper 3 guidance published by the IB, the three questions asked on this exam will always be the same, or at least will always be about the same idea even if the wording is not the exact same. Thus, if you are wondering why all of the questions for each case study are the same, this is why.

 

Question 1: 2 marks

Describe a human need that the organization fills through its business. This needs to be paired with a business management theory. 

 

Here some thoughts on that:

  • The IB mentions motivation as an example of a course link, and applying Maslow’s hierarchy of needs would seem to be the most straightforward way of doing this.  In the teacher support material released so far, the only student responses that have linked specifically to course theory and thus gotten full credit on this question have been linked to Maslow's hierarchy.

  • On a sample student response, a student mentions financial needs but is awarded no credit by the examiner because it is too vague.

 

Since the syllabus standards only mention the word “theory” in connection with motivation theories and theory of knowledge connections, it is unclear at the moment what would meet the IB’s expectations on this question other than motivation theory.  At the very least, motivation theory is by far the most obvious connection, and within that Maslow's hierarchy of needs is the most starightforward connection to the idea of "human need" that question 1 asks about.  Therefore, it's pretty natural for students to just stick to the following theory connections to be safe.

 

  • Herzberg: meeting hygiene needs

  • McClelland’s acquired needs theory: need for achievement, affiliation, or power

  • Deci and Ryan’s self determination theory: need for autonomy, competence, or relevance/relatedness

  • Need for equity (Adams’ motivation theory)

 

Question 2: 6 marks

Explain two key challenges facing the organization. 

 

As per the guidance coming from IB workshops at the time of writing, here is how the 3 marks marks are to be awarded on each of the two parts of the 6 mark questions: 

  • 1 mark for identifying the challenge

  • 1 mark for explaining that challenge

  • 1 mark for applying it to the stimulus material

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In all honesty, this is awfully similar to the 2+2 structure for the 4 mark questions that use the command term explain.  The idea here seems to be to simply go further in your explanations.  It is not clear if the IB will give us another type of question in which the command term explain is used, the student has to explain two examples, and the maximum mark level is 6.  On the 2016 syllabus, all 4-mark explain questions had two components to explain, and 6 mark explain questions had three components to explain.

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Question 3: 17 marks

Check back later.  IB Biz will do some thinking out loud about this soon.

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While there's no required format for the essay, it's important to think strategically about how to organize the essay in order to maximize your potential marks. A recommended format might look like this: 

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1. Intro Paragraph: Briefly (2-3 sentences max) break down the major problems and issues the social enterprise faces.  Include a clear thesis statement that outlines the major aspects of your plan.   Do not spend too much time repeating what the case study already says - the examiner knows the case study, so you don't need to tell them.  The intro paragraph does not need to be more than a few sentences.

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2. Body Paragraph 1: First recommendation for firm's plan of action.  It's best to focus this on the most immediate short term action.  Acknowledge the drawbacks to this action as well to show proper balanced evaluation. 

3. Body Paragraph 2: Second action of the plan, focusing on short or medium term. 

 

4. Body Paragraph 3: Final action, focusing more medium to long term. 

 

5. Concluding paragraph

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Paper 3 Essay DOs and DON'Ts

So...how do I crush it on the 17 mark question?

And what are mistakes to avoid?

Do

  • Keep the short term vs. longer term actions in mind. A firm may eventually be able to do something you'd recommend, but cannot do so now without other steps falling into place.

  • Directly quote or paraphrase resources, directly using phrases such as, "as seen in resource 1."

  • Consider trade-offs of actions. 

  • Read between the lines and speculate on what might be, or is likely to happen, showing that you understand the implications of the resources presented to you, not ONLY what is directly written in the stimulus material. 

  • Deliberately use the majority, and preferably all of the resources at least once.

  • Justify your analysis by elaborating upon it. Too many students analyze by breaking a point or information down, but do not go further to true evaluation by elaborating on why something is true, or what something means for this firm in this situation. 

  • Keep in mind what is reasonable for a firm to do. Imagine if you were in their situation in the real world, with all of its challenges.

  • Use terms that apply. For instance, if you are arguing that a firm should introduce a produce a product a low price to get people in the door and buy more expensive items, then use the term "loss leader."

  • Consider multiple stakeholders.  If something is great for customers but they employees very clearly could/would not go for it, then you're wasting your time with that recommendation.

Don't

  • Recommend something that the firm will not be able to afford to do, or the workforce will not reasonably be able to do. 

  • Use too many syllabus terms/concepts that are not actually relevant to your plan or genuinely helpful.  You'll be wasting time better spent elsewhere, and the examiner will clearly see when a student is trying to use terms simply to show that they can use terms.

  • Make references to real life organizations that the IB examiner may not be aware of.  Set your response in the fictionalized world of the case study.

  • Forget a conclusion in which you wrap up the most compelling reasons for your plan of action.  

  • Simply say that something is "risky."  All business is risky, so if you bring up risk, then it really helps to explain what is particularly risky about this action for this firm in this context.

  • Make the intro paragraph too long.  It's actually quite possible to merge paragraph 1 and the intro paragraph into one, dedicating the first few lines to an intro and thesis.  Some students waste too much time writing an overly-long and formal intro paragraph.  ​

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