Syllabus: AQA - AS and A Level Business
Module: 3.4 Operational Management
Lesson: 3.4.5 Making Operational Decisions to Improve Performance: Managing Inventory and Supply Chains

Introduction

This article supports teachers, SLT, and careers leads delivering the AQA A Level Business syllabus, specifically Unit 3.4.5: Managing Inventory and Supply Chains. It aligns directly with the AQA specification, ensuring curriculum relevance while embedding commercial awareness and workplace readiness—core priorities for both classroom delivery and Gatsby Benchmark compliance.

As schools increasingly seek to demonstrate Ofsted-ready career education and real-world problem-solving, this module provides fertile ground to connect theoretical operations management to practical decision-making and commercial literacy.

Key Concepts

According to AQA’s specification, students are expected to understand and apply the following within the context of operational decisions:

• Inventory Control:
  Understanding lead time, buffer stock, re-order levels, and re-order quantities using control charts and inventory diagrams.

• Matching Supply and Demand:
  Managing fluctuations through outsourcing, using temporary or part-time staff, and producing to order.

• Supplier Selection Criteria:
  Including quality, reliability, cost, and strategic alignment.

• Effective Supply Chain Management:
  Ensuring value is added through streamlined processes, strategic outsourcing, and close supplier relationships.

• Operational Efficiency:
  Linking lean operations, logistics optimisation, and cost control to organisational objectives.

Real-World Relevance

Recent real-world supply chain disruptions—from COVID-era shortages to post-Brexit customs delays—make this topic strikingly relevant. For instance:

• Just-in-Time (JIT) vs Just-in-Case (JIC):
  Toyota’s early commitment to JIT exposed vulnerabilities during semiconductor shortages, prompting a hybrid model approach.

• Retail Sector Responses:
  Supermarkets like Tesco and Sainsbury’s adapted by investing in warehouse automation and predictive inventory software to reduce spoilage and overstock.

• SME Adaptation:
  Many UK SMEs turned to local suppliers to reduce delivery risk and carbon footprint—showcasing how supply chains are both operational and strategic decisions.

Use mini case studies like BrewDog’s pivot to UK-based logistics partners or NHS supply chain reforms for extension tasks or classroom discussion.

How It’s Assessed

Students will encounter this topic across multiple papers:

• Assessment Objective Coverage:

  • AO1: Demonstrate knowledge of operational terms (e.g., buffer stock).

  • AO2: Apply concepts to case study businesses.

  • AO3: Analyse the effectiveness of supply strategies.

  • AO4: Evaluate decisions under constraints (e.g., cost vs. flexibility).

• Command Words to Emphasise:

  • Analyse, evaluate, justify, recommend, calculate

• Exam Format:

  • Data response questions using inventory charts or case data

  • Extended evaluation questions often focusing on JIT vs JIC, outsourcing decisions, or supply chain risks

  • 20-mark essays asking students to recommend operational strategies under contextual business constraints

Enterprise Skills Integration

This topic integrates three core enterprise skill areas:

1. Decision-Making & Problem-Solving:

   • Students weigh up sourcing options and supplier risks.

   • Tasks involve interpreting data to make operational trade-offs.

2. Commercial Awareness:

   • Real insight into how businesses manage costs and customer expectations.

   • Understanding how strategic outsourcing can impact long-term sustainability and reputation.

3. Workplace Readiness:

   • Encourages students to consider logistics, supplier relationships, and how businesses adapt in uncertainty—mirroring real workplace challenges.

These competencies are also embedded in Skills Hub activities and simulation events that model supply chain decisions with real-world consequences.

Careers Links

This unit directly supports Gatsby Benchmarks 4, 5, and 6:

• Benchmark 4 – Curriculum to Careers:
  Links concepts like inventory management and outsourcing to real roles in logistics, operations management, and procurement.

• Benchmark 5 – Employer Encounters:
  Students can explore virtual case studies or guest input from logistics firms and retail chains (available in Skills Hub Futures).

• Benchmark 6 – Workplace Experiences:
  Simulated supply chain scenarios replicate decision-making pressures operations teams face in real roles.

Related Career Pathways:

• Operations Analyst

• Logistics Coordinator

• Supply Chain Manager

• Inventory Planner

• Procurement Officer

These roles exist across sectors—manufacturing, healthcare, retail, and the public sector.

Teaching Notes

Suggested Delivery Activities:

• Inventory Simulation:
  Use interactive spreadsheet tools or Enterprise Skills’ simulations to model buffer stock levels under changing demand.

• Mini Case Study Debate:
  Pose a scenario: “Should a mid-sized bakery outsource production?” and have students present opposing recommendations.

• Control Chart Interpretation:
  Provide historical stock levels and ask students to identify re-order points and risks.

Common Student Misunderstandings:

• Confusing lead time with re-order level

• Over-simplifying outsourcing as always cost-saving

• Not considering qualitative supplier factors like reliability or ethical sourcing

Extension Opportunities:

• Cross-Curricular Link:
  Bring in GCSE Maths for stock turnover and reorder calculations. Tie in Geography when discussing global supply chains.

• Guest Speaker Ideas:
  Invite a logistics manager or supply chain analyst to speak (or use pre-recorded case studies from Skills Hub Futures).

• Assessment Prep Tip:
  Use past 20-mark essays with model structures:
  Introduction –> 2 Analysis Paragraphs –> 2 Evaluation Paragraphs –> Recommendation.