Skills You Need To Demonstrate (DP IB Business Management): Revision Note

Introduction to the assessment objectives

• In IB Business Management, success is about more than just memorising facts

• You need to understand concepts, apply them to real business situations, analyse problems, and evaluate solutions

• The IB assessment objectives (AOs) are designed to test these skills and help you become a confident business thinker

• There are four assessment objectives:

  • AO1 – Knowledge and Understanding

    • Knowing key business concepts and theories.

  • AO2 – Application and Analysis

    • Using your knowledge to solve real business problems.

  • AO3 – Synthesis and Evaluation

    • Making decisions and weighing up different business strategies.

  • AO4 – Use and Application of Appropriate Skills

    • Applying business tools, interpreting data, and communicating your ideas effectively.

• Each of these skills is tested in your exams and coursework

• Understanding what they involve and how you can develop them will help you to improve your answer and achieve a better grade

AO1 – Knowledge and understanding

• This objective is about demonstrating your understanding of business management tools, theories, and concepts

• You need to know topics such as marketing strategies, financial accounts, and business structures

• However, just listing facts isn’t enough—you need to show that you understand what they mean and how they work

  • For example, if you're asked about pricing strategies, you should be able to define terms like "cost-plus pricing" and "penetration pricing", and explain when businesses might use them

Command Terms for AO1

• Define

• Describe

• Identify

• List

• Outline

• State

AO2 – Application and analysis

• This is where you take your knowledge and apply it to business situations

• The IB will often give you a case study and ask you to analyse the challenges a business faces

• To do this well, you must explain how theories and concepts relate to the specific situation

  • For example, if a business is struggling with cash flow, you might apply what you know about cash flow forecasts or short-term financing options to suggest possible solutions

Command Terms for AO2

• Analyse

• Apply

• Comment

• Demonstrate

• Distinguish

• Explain

• Suggest

AO3 – Synthesis and evaluation

• At this level, you need to go beyond just applying business concepts

• You must compare options, justify decisions and evaluate the strengths and weaknesses of business strategies

  • For instance, if a company is considering expanding internationally, you could evaluate the risks and rewards by looking at stakeholder interests, financial implications, and potential market challenges

• A great evaluation answers both sides of an argument and concludes with a well-justified recommendation

Command Terms for AO3

• Compare

• Compare and contrast

• Contrast

• Discuss

• Evaluate

• Examine

• Justify

• Recommend

• To what extent

AO4 – Use and application of appropriate skills

• This objective focuses on your ability to use business tools, interpret data, and present your ideas clearly

• You may need to construct a break-even chart, analyse financial statements, or write a structured business report using correct terminology

  • For example, if given sales revenue and cost data, you might be asked to calculate profit margins and interpret what they mean for the business

Command Terms for AO4

• Annotate

• Calculate

• Complete

• Construct

• Determine

• Draw

• Label

• Plot

• Prepare

Top tips for demonstrating skills

• Use case studies

  • The best answers apply real-world examples

• Develop strong analysis skills

  • Always explain why something is happening in a business context

• Balance your evaluation

  • Weigh up the pros and cons before making a decision

• Practise command terms

  • Understand what each command term requires so you answer exam questions at the right level

• Communicate clearly

  • Use business terminology and structure your answers logically