NSWBusiness StudiesSyllabus dot point

What influences operations decisions in contemporary Australian businesses?

Influences on operations - globalisation, technology, quality expectations, cost-based competition, government policies, legal regulation, environmental sustainability, and corporate social responsibility (the difference between legal compliance and ethical responsibility)

A focused answer to the HSC Business Studies dot point on influences on operations. Globalisation, technology, quality expectations, cost-based competition, government policies, legal regulation, environmental sustainability and CSR, with the difference between legal compliance and ethical responsibility worked through Coles, Qantas and Atlassian.

Generated by Claude OpusReviewed by Better Tuition Academy9 min answerUpdated 2026-05-20

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Quick answer

The eight influences on operations are globalisation, technology, quality expectations, cost-based competition, government policies, legal regulation, environmental sustainability and corporate social responsibility. Each shapes operations decisions in measurable ways - globalisation expands supplier and customer choice but raises risk; technology lowers cost but adds capex and cyber exposure; quality expectations drive quality management investment; cost-based competition drives lean operations; government policy and legal regulation set compulsory operating constraints; sustainability and CSR drive investment beyond the legal floor. The legal compliance v ethical responsibility distinction is the difference between what the law requires and what the business chooses to do above that.

What this dot point is asking

NESA wants you to identify the eight key influences on operations, explain how each shapes operations decisions, and make the explicit distinction between legal compliance and ethical responsibility. Expect a 5 to 8-mark Section II question that evaluates two or three influences applied to a real business, plus possible Section III stimulus where you have to identify the influences acting on the case-study business.

The answer

The eight influences in the syllabus are not equally weighted in real exam papers - globalisation, technology, quality expectations, sustainability and CSR turn up most often. Master all eight but expect those five to dominate.

1. Globalisation

Definition: The increasing integration of economies through trade, investment, labour and capital flows.
Impact on operations: Global supply chains expand the supplier base (cheaper inputs, more choice) but increase exposure (geopolitical risk, currency movements, freight cost). Global customer markets expand demand but require new product variants and compliance with foreign regulation.
Example: Cochlear assembles cochlear implants in Macquarie Park, Sydney, sources components from Europe and the US, and sells into 100-plus countries. Its operations function manages multi-currency procurement, regulatory submissions in each jurisdiction, and global service centres.

2. Technology

Definition: The application of scientific knowledge and tools to the operations process.
Impact on operations: Automation reduces per-unit cost (Coles's automated distribution centres). Digital systems reduce information lag (real-time inventory at Bunnings). Customer-facing technology improves the experience (self-check-in at Qantas). Risk: high capex, cyber exposure, technology obsolescence.
Example: ANZ's "ANZ Plus" digital bank rebuild replaced legacy banking platforms with a cloud-native technology stack. Operations now runs new product launches in weeks rather than months.

3. Quality expectations

Definition: The standard of performance customers expect of the business's output (durability, accuracy, reliability, fit-for-purpose).
Impact on operations: Quality expectations drive investment in quality management (ISO 9001 certification, TQM programs), supplier auditing, and post-sale support. Failing to meet expectations triggers product recalls and reputation damage.
Example: Toyota's reputation for quality requires a meticulous Toyota Production System (TPS) of standard work, kaizen (continuous improvement) and jidoka (automation with a human touch). Toyota Australia (now an importer rather than manufacturer) extends TPS to its dealer service-centre operations.

4. Cost-based competition

Definition: Competition fought primarily on price rather than features or service.
Impact on operations: Forces relentless cost reduction - lean inventory, automation, supplier consolidation, off-shoring. Limits investment in differentiation features. Sectors with intense cost-based competition include supermarkets, airlines (especially budget carriers like Jetstar), and discount retail.
Example: Aldi's operations are engineered for cost-based competition - limited SKUs (around 1,800 v Coles's 25,000), low-rent retail formats, minimal labour through self-pack and trolley-deposit systems, and exclusive supplier contracts that lock in low input cost.

5. Government policies

Definition: Government decisions on industry policy, taxation, trade, monetary policy and grants that change the operating environment.
Impact on operations: Tariffs and free-trade agreements change supplier and export economics. Industry policies (the Future Made in Australia agenda, the Critical Minerals Strategy) create grants and incentives. Carbon pricing and the Safeguard Mechanism change cost economics for emissions-intensive operations.
Example: The Australia-UK FTA (ratified 2023) removed tariffs on most Australian agricultural exports. For meat processor JBS Australia, that changed UK market access economics and triggered operational re-orientation toward UK customers.

6. Legal regulation

Definition: Compulsory rules set by Australian, state and local government that constrain operations.
Impact on operations: WHS Act and regulations (workplace safety), Fair Work Act (employment), Australian Consumer Law (product safety, warranties), Privacy Act and Notifiable Data Breach scheme (customer data), Modern Slavery Act 2018 (supply-chain reporting), environmental acts. Non-compliance triggers fines, executive prosecution, and class actions.
Example: Optus's 2022 data breach exposed 9.8 million customer records and triggered Privacy Act enforcement action plus a major class action. The operational consequence: a forced rebuild of identity and access management systems and a multi-year investment in security operations.

7. Environmental sustainability

Definition: Operating in a way that meets the needs of the present without compromising the ability of future generations to meet their needs.
Impact on operations: Drives investment in renewable energy, waste reduction, circular-economy product design, and emissions reporting. The Climate-related Financial Disclosure regime (mandatory from 2025 for large entities) requires operational reporting on Scope 1, 2 and (for many) Scope 3 emissions.
Example: Woolworths committed to 100 percent renewable electricity by 2025 and is investing in solar at distribution centres and PPAs (power purchase agreements). Its plastic-bag removal and own-brand packaging reductions are operational sustainability decisions.

8. Corporate social responsibility

Definition: A business's voluntary commitment to operate ethically, contribute to the community, and consider all stakeholders (not just shareholders).
The legal v ethical distinction: Legal compliance is the floor - you must do it. Ethical responsibility goes beyond. Coles paying small suppliers in 14 days (when the law requires only disclosure of payment terms) is ethical responsibility, not compliance. Atlassian's pledge to donate 1 percent of equity, employee time and product to charity is CSR going beyond any legal requirement.
Impact on operations: CSR adds cost in the short term (higher input cost, slower supplier onboarding, more reporting) but supports brand, employee engagement, and licence to operate. Done well, it reduces long-term regulatory risk because the business is operating ahead of the regulatory curve.

Worked example

"Assess two contemporary influences on operations management for a contemporary Australian business. (6 marks)"

Plan: Choose Qantas; pick globalisation and environmental sustainability; structure as two short paragraphs and a judgement.
Globalisation: Qantas operations are deeply globalised - aircraft from Airbus and Boeing, engines from Rolls-Royce and GE, fuel sourced through global commodity markets, and routes connecting Sydney to over 30 international destinations. The benefit is access to scale-efficient global suppliers and a worldwide customer base. The risk is concentrated dependency (the Rolls-Royce engine maintenance backlog grounded multiple A380s in 2022) and FX exposure on fuel and aircraft purchases.
Environmental sustainability: Qantas committed to net-zero by 2050 and a 25 percent reduction in emissions by 2030. The operations consequences include investment in sustainable aviation fuel (SAF) supply contracts, fleet renewal toward more fuel-efficient A220 and A350 aircraft, and a carbon-offset Future Planet program for customers. The cost is significant capex; the benefit is regulatory positioning ahead of any future aviation emissions scheme and customer-segment preference.
Judgement: Both influences are net positives for Qantas's competitive position, but both raise operational risk that requires deliberate hedging (supplier redundancy, FX hedging, fleet diversification, SAF supply contracts). The operations function is now as much about managing these influences as it is about running flights.

Past exam questions, worked

Real questions from past NESA papers on this dot point, with our answer explainer.

2020 HSC6 marksEvaluate the impact of globalisation and technology on the operations of a large Australian business.

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A 6-mark evaluation needs both influences, their positive and negative impacts on operations, and a clear judgement supported by a named example.

Globalisation: Globalisation has expanded both the supplier base and the customer base for large Australian operations. For Qantas, globalisation means sourcing aircraft from Airbus (France) and Boeing (USA), engines from Rolls-Royce (UK), and IT services from offshore providers. The benefit is access to lower-cost or higher-quality inputs and a global customer base. The cost is supply-chain exposure: the 2022 Rolls-Royce engine maintenance backlog grounded Qantas A380s for months, and global jet fuel price volatility passed through to operating costs.
Technology: Technology has automated and digitised core operations. Qantas's "Project Sunrise" Sydney-London direct service depends on next-generation A350-1000 aircraft and digital fuel-optimisation systems. The benefit is lower cost per available seat kilometre and improved customer experience (Qantas app, self-service bag drop, biometric boarding). The cost is large capital investment and IT-failure exposure; the 2023 Qantas IT outage that prevented customer check-ins illustrated the operational fragility of technology dependence.
Judgement: Both influences increased competitiveness on net but raised operational risk. Qantas's response is to invest in redundancy (multiple aircraft suppliers, IT failover) and risk hedging (fuel hedging, FX hedging). For a 6-mark evaluation, that 'both upside and risk' framing earns the higher band.

2024 HSC5 marksDistinguish between legal compliance and ethical responsibility in operations management. Use an example.

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A 5-mark answer needs both definitions, the contrast, and a worked example showing the difference.

Legal compliance means meeting the minimum standards imposed by law. In operations, this includes work health and safety (the WHS Act), product safety (Australian Consumer Law), environmental protection (state EPA acts), and modern slavery reporting (the Modern Slavery Act 2018).

Ethical responsibility means going beyond what the law requires because the business judges it to be the right thing to do. It includes CSR commitments, sustainability commitments above the legal floor, and proactive supplier-conduct audits.

Worked example: Coles supermarkets. Coles is legally compliant on supplier payment terms (Payment Times Reporting Act 2020 requires disclosure of large-business payment to small suppliers). Going beyond legal compliance, Coles voluntarily reduced its standard small-supplier payment term from 30 days to 14 days in 2020. This is ethical responsibility - no law compelled it, but Coles judged that supporting small Australian farm suppliers in the post-Covid period was the right thing to do (and supported its brand).

Another example: the legal minimum for free-range egg labelling under the Free Range Egg Standard is 10,000 hens per hectare. Coles's "Honest to Goodness" eggs voluntarily limit stocking to 1,500 per hectare - a much higher ethical bar than the legal minimum.

Markers reward (1) clear definition of each, (2) explicit contrast (mandatory v voluntary), (3) a worked example with the legal floor and the voluntary uplift shown.