Business and Business Environment Report

This report analyzes the business environment, examining different types of organizations, their structures, and the impact of macro-environmental factors. It uses Lego Toy Company as a case study, analyzing its strengths, weaknesses, opportunities, and threats. The report also explores the relationship between organizational structure and functionality, emphasizing the importance of PESTLE analysis in business development.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
P1. Various types of organizations and its purpose................................................................1
P2 Size and Scope of organization-........................................................................................2
TASK 2 ...........................................................................................................................................5
P3 Different type of organizational structure and Difference between the relationship between
functions and organizational structure-..................................................................................5
TASK 3............................................................................................................................................7
P4 Positive and Negative impact on micro environment in United Kingdom.......................7
TASK 4............................................................................................................................................9
P5 Internal and external analysis of Lego toy Company in order to analyses strength and
weakness.................................................................................................................................9
P6 Strength and weakness related with external macro factor.............................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment is a combination of different external and internal factors which
influence the organization to manage business situations and conditions. These factors affect the
growth, profitability and performance of organization. These are important to develop the
business and expand their organisation all around the world.
This report will discuss about the different types of organizations and their purposes.
There are different kinds of organization such as Lego, UNICEF and Bank of England, etc. It
will discuss about their strength and weakness in the business development process. This report
discuss about the Legal structure, scope and size of organization. Positive and negative factors
affecting the organisations.
TASK 1
P1. Various types of organizations and its purpose
There are different types of organization which divided the company according to their
structure and size, scope of the organization etc. This is very important for organization structure
depend upon their employee and legal structure etc. there are different type of organization
discuss in following:
Private organization- This organization is based on one person which established their
business across the world. This organization is managed by owner to achieve organisation goal
in proper manner. Lego Toy company manufacture a different type of product which is helpful
for increasing their productivity and profitability. They provide the different flagship product in
the marketplace. Lego is a private organization which is operated by Richard Milne. The main
objective of this organization to expand the business in different countries. They will increase
their profitability and productivity in marketplace(Lendrum and Wittemyer, 2018). This
organization is target to marketplace and launch a new product. They provide the best quality of
product and services in marketplace.
This organization is not to be consider as public organization because Lego organization
is share their market value in the form of list. They will increase their selling price in
marketplace due to increase their profitability. They mainly focus on increase their business
which is very important for owner to manage all the business activities in effective ways.
Public organization- Bank of England is public organization to Establish by One or more
people. This organization will provide the best quality of services and product regarding the
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financial services, Loans etc. The government is providing the funding to this organization for
increasing their market share. This organization is increasing their profitability and productivity
in marketplace because they contribute all the profit towards the human welfare to provide the
best quality of services and facilitates.
The main vision of this organization to provide the facilitates related the financial
services etc. this organization is helpful for giving the best quality of services to the people.
Voluntary organization- Voluntary organization is a part of non-governmental company
which is helpful for company to provide the best quality of services and facilitates to their
customer. The main objective of this organization is to provide the safety and security for human
welfare, social culture etc (Lendrum and Wittemyer, 2018). This organization increase their
visibility in marketplace. UNICEF is also voluntary organization which is established by Tore
Hattrem. This organization mainly establish the business to provide the fund for poor children
which is important for nation to develop their country.
P2 Size and Scope of organization-
There are different type of organization which has various size and scope of the
organizational discuss in following:
Basis Public Private Voluntary
Type Public organization is
operated by government.
They provide the best
quality of public
services.
They use different
resources which is
beneficial for society
and
community(Lendrum
and Wittemyer, 2018).
Public sector is a part of
economy which is made
by public services as
Private sector can be
operated by
individual or group to
increase their
productivity and
profitability in
marketplace.
Private organization
is a part of country
economy as a citizen
sector. This
organization usually
increase the profit but
which is not
Voluntary is a group of
people who agreement
with the volunteers.
UNICEF is a voluntary
organization to provide
the safety and security to
their customer. This
organization will create a
social wealth which is
helpful for organization.
This organization mainly
focus on to provide the
best services their
customer because this
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well as enterprises. This
organization provides
the public governmental
services and goods in
the marketplace. Bank
of England is public
organization to provide
the best services their
customer regarding the
loans and fund for the
business purpose.
controlled by the
central and state
government.
Lego is private
organization to
influence or motivate
to their employee
towards the earning
maximum profit in
marketplace.
organization will
establish the business for
social community. They
contribute to develop
their community and
society.
Legal structure This organization will
provide the many
additional resources
regarding the
managerial and financial
which is important for
organization to borrow
the money and manage
the entire business in
proper manner.
This organization is
form of minimal legal
start-up cost because
only one person
operates to manage
the business
operations and
functions. The
Business profitability
is taking advantage to
owner of this
organization.
This organization will
establish the business and
taking the common
purpose and interest
which is helpful for the
public. All the law and
constitution is managed
by the government
committee. They are not
recognized as legal
entity.
Purpose The main objective of
this public organization
to provide the best
quality of product and
services their customer.
They are increasing their
profit for the purpose of
This organization is
focus on increasing
their productivity and
profitability in
marketplace(Ahen ,20
18). They are earning
a lot of money for
Voluntary is the main
organization which is
helpful for human being
and social community to
provide the services.
UNICEF is voluntary
organization to provide
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human society. Bank of
England is public
organization to provide
the services for human
regarding the loans,
funds, investment,
financial etc (Nickel and
Adam,2015).
develop the entire
business in all around
the world. They
concern about their
sales and
productivity. Lego is
a private organization
to provide the
effective quality of
product which is
helpful for
development and
growth.
the facilitates for poor
children regarding the
safety and security,
educations, medical
facilitates etc (Sekaran
and Bougie, 2016). this
organization is very
beneficial for people.
Size This organization
mainly 80-100 people
working together to
develop the business in
all around the world.
This organization
mainly 100-150
people start their
business in
marketplace. They
invest large amount of
money for business
process so that they
earning maximum
profit in marketplace.
In UK, There are
many types of private
organization
establish.
This organization will
control by the local
authority to manage all
the facilitates and
services in marketplace.
There are mainly 10-15
people working together
to provide the best
quality of services to
their customer(Albu and
Mateescu, 2015).
Scope This organization will
increase the business for
human being to provide
This organization will
also increase the
maximum profit in
This organization is
helping to human being
and society etc.
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the best facilitates and
services.
marketplace. Private
organization is
helpful
TASK 2
P3 Different type of Organizational structure -
There are various type of organization structure useful in the business development
process and it also categorizes according to their functionality and structures. There are different
type of structure discussed in following:
Functional structure- This structure is based on the functionality of business process. This
structure managed by the Manager (Alégroth and Radway, 2018). They will maintain the each
and every department maintain in proper manner. Lego is divide into the functional structure
because they are following all the process according to their functionality which is very
important part for organization. These structure will allow completing their task on time which is
necessary part of every organisation (Solomon and Shields, 2016). Lego is the organization to
individual departments are completed their tasks. Manager is important person to handle the
business strategy and planning for establishing their business process.
Divisional Structure- According to this structure, the organization is divided according to
different department and they performing different operations to achieve their goals and
objectives. Marketing, sales and accounting, finance are the important operations which is
performed different functions (Carroll and Buchholtz, 2014). Lego is the organization to divided
all the departments and performing different functions. It is very expensive to manage all the
business operations and functions. Most of the organization use this structure to follow all the
business development process. This is very important for Lego to identify the actual need and
requirement of business. Divisional structure is systematic completed the task on time.
Matrix Structure- This is very important structure because it is combination of divisional
and functional structure. Lego is based on the matrix structure because it is very complicated for
the organization to manage the business process in effective ways. Most of the organization used
dual management system because it is helpful for doing multiple task in proper manner. Lego is
the fastest growing organization to expand their business all around the world because they using
different techniques to achieve their goals and objectives.
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The relationship between the organizational structure and its functionality-
Lego is the fastest growing organization which is based on the top product company to
manufacture different type of product in marketplace. They provide the best quality of services
to their customer. They have unique goals and objective to perform different operations and
functions in different departments.
Information technology- According to Lego, This organization use different latest
technology to improve the performance of business and development. As Current Scenario, this
organization is implement new idea for growth and development which is helpful for expanding
their business in all over the world. Information technology is related the human resource
management because they use tool and platform to provide the best training to their employee for
growth and development (Chang, 2016 ). With the help of technology, it also useful for
promoting their product and services. Most of the time, they provide the vacancy information
with the help of their own website which is beneficial for organization to give advertisement on
the newspaper and website.
Marketing- Marketing is the best part to promote their product and services in global
marketplace. This is very important concept to manage the business operations and functions
with the help of marketing. Lego is a leading organization which is also used this technique to
promote their product and services in marketplace. This is related with information technology
because they provide the detail of particular product with the different tools and platform like
advertising and website etc (Charter, 2017). Marketing is the best platform to provide the
information of product and they also giving the information of new launching product.
Human resource management- this is the main part of organization to manage the
business operations and functions. Human resource management is performing different
functions such as training and development, recruitment and selection, salary slip, appraisal etc.
They are collecting all the information of employee and it also provides the development
program for growth and development. HRM officer is conduct different program to manage the
process in proper manner. They using new technology to collect the information and detail of
employee regarding the personal information etc. In human resource department HR officer is
playing important role and responsibilities which is essential to manage the business operations
in proper manner. This is main part of each and every organization.
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Finance- this is important department to find out the overall budget of organization and
They are interconnecting with the marketing, HRM to manage the entire business process in
proper manner. Lego is a leading organization to take fund with the different ways such as
investor, Bank loan etc. Funding is useful for organization to develop the business in different
countries as well as cities (Classi and Randall, 2018). This organization is planning an effective
strategy for growth and development. Finance is the important department to handle the overall
budget and also finding the important product. This department will mention the price of
particular product which is helpful for taking suggestion and feedback according to the demand
of customer. They maintain the entire business process in proper manner.
TASK 3
P4 Positive and Negative impact on micro environment in United Kingdom
Marketing is the best platform to promote their product in marketplace because it is very
helpful for increase the sales and productivity in marketplace. Lego is a leading organization to
manage the business process in effective ways. For business development process, there are lot
of problem and issue arise on the time of development so that it is important to plan a strategy to
solve the problem in proper manner. There are different factors such as economical, social,
technology, economic which is impact on the macro environment. These factors are playing
important role in the organization to increase the sales and productivity in marketplace (Crane
and Matten, 2016). PESTLE analysis will identify the entire business requirement and need to
handle the different logics in effective ways. External and Internal factor is playing important
role to impact on the business activities.
Political factor- Political factor is affect the Lego organization in the terms of their legal
issues and governmental rules and regulation. This organization will follow some important
factor which is affect the business development process such as traffic, political stability, trade
restriction, labour law, environmental rules and regulations etc. Lego is also making own policy
and law for growth and development.
Economic Factor- Economic factor is affect the business functions and operation in the
Lego organization. At the time of recession, this organization is already predict the loss of
organization and it also prevents to increase the workforce. This factor is impact on the inflation
rate, economic growth of organization and increase the interest rate etc. This factor is important
to manage the business operations and functions in proper manner.
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Social factor- Social factor is affect the demographical and social culture of environment.
Some times, it will increase the health problem and consciousness which is affect the product
because the demand of product is increasing in the marketplace. This factor includes career
attitude, age distribution, increase the growth of population rate, safety and security etc.
Management reshuffling is the important concept to impact on the business activities. Lego is the
organization to helpful for identify the latest trend on the international market (Cumiskey and
Clarke, 2018). Social factor is important in the macro environment because it is directly impact
on the business environment.
Technological factor- Technology factor is affect the quality and cost of product that is
launch in marketplace. This factor is also identify the various barriers which are generated at the
time of production and it also decreases the efficient level of production. Lego is used new
technology for growth and development. They are using tool and platform for promoting their
product in marketplace. Most of the customer interact towards their product and services because
they provide the best quality of services which is beneficial for the organization. According to
Lego, they easily measure all the business need and requirement because it is required changing
their strategy and planning (ESPORLAS, 2018). This factor is important to increase the speed of
business process.
Legal factor- Legal factor is inspire or influence to the business operations and its cost.
In marketplace, the demand of product is increases because Lego organization is provided the
best quality of product which is impact on the health and safety, consumer law, employment law
and discrimination law etc. these laws is necessary for organization to manage the business
operations and functions in proper manner (Hair and Page, 2015). This factor includes
advertisement, equal rights, security and safety etc. With the help of this law, the employee is use
this rights to protect ourself which is advantages for growth and development.
Environmental factor- this factor is an essential which is impact on the business
environmental condition, weather, climate change etc. climate change is important part of
organization to redesign and restructuring their business operations. It also provides the space to
innovate new idea and this idea is implements in the business development process. This factor
includes recycling and sustainability etc.
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TASK 4
4 Internal and external analysis of Lego toy Company in order to analyse strength and weakness
Strength of Lego toy company: this company is very popular in the world. This company
has outlet is all over the world (Hamilton and Webster 2015). Lego toy manufacture different
and unique products. This uniqueness help customer’s in product differentiation. Lego prepare
theme park in popular destination. Mangers use creative mind and innovative ideas to design
there toys. Company advertise there products using television and social media. Various strategy
and methods are adopted by managers to maintain brand image in market. This company design
toys according to requirement and need of children. Lego offer most valuable services to
customer’s. Customers are very loyal towards this brand because it help in creating memory in
childhood. Company use innovative techniques to increase profitability.
Weakness of Lego toy company : Lego toy company lack in there production process. They
have not adopted standard production process which result in wastage and increase in production
process (Botha, Kourie, and Snyman, 2014). This company has too much diversification, which
can lead to confusion. Lego company has loose attention towards fundamental principle of
company. This company has high production cost, which is the reason behind high price of
product. Lego company has strong competition from different brands. They fail to dominate
market, this is where other company gain advantage of creating monopoly.
Opportunities of Lego toy company : Lego toy company can focus on making innovative and
creative toy. Parents expect that there children enhance skills and knowledge. This will motivate
them to buy toy of Lego. Products must be designed to satisfy demands of product. Lego toy
should focus skills and brain development of children. Research prove that children can learn
more from experiments rather than from theoretical knowledge. Toyota must design toys to
attract children. They can make them look more interesting and attractive. Lego company can
use basic fundamental principle of students to design educational toy. This opportunity that
Lego toy company can grab from the market. Company is surrounded by various environmental
factors, they garb opportunity to increase there returns and profitability. This company has
opportunity of international growth. If company focus on key area of development, this will
result in long term growth and development (Hair, Wolfinbarger and Page, 2015).
Threats of Lego company : this company is very costly, thus many people can not afford it.
There are probability that customer’s will switch there brand because they do not have enough
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income to buy product. People generally prefer brands that cheaper or economical. People
having high income can buy toy. Other competitive brands offer similar product in much cheaper
rate. There are lot of fraudulent company that has entered market. People get confused between
original and duplicate product. People generally prefer buying duplicate and cheap toy. This has
adversely affected sale of Lego. There is continuous price war going between Lego and other
competitive brands (Crane and Matten, 2016). They compete with each other regarding price
which results in lower profitability of company.
P6 Strength and weakness related with external macro factor
Lego group of toy is one of the oldest and largest toy brands. From years they are serving
customers. They design toys and products according to desire of customers. They play
significant role in manufacturing sector. PESTLE analysis is conducted to determine strength
and weakness of company. Threats are uncontrollable and it is not possible cover all possible
threats or weakness of company. Lego company consist of large part in manufacturing sector.
They have set up factory in remote areas of UK, which has provided job to many people in
economy. Lego company has created job opportunity for many people, which has lead to
increase in lifestyle of people (Carroll and Buchholtz, 2014). This company has introduced more
attractive toys. Lego toy manufacture children friendly products. They look after safety and
security of kids. Lego grouped has introduced Lego girls, in order to support healthy girls. This
has created negative impact on children's.
Political culture of Lego is very impressive because they have adopted multi culture.
Government introduce various policies to support children friendly products. They have
introduced various policies that are related to friendly investment policies. This policy attract
investors to invest in project. There are various legal factors that affected Lego company. They
have formed groups with other brands in order to avoid penalty enforced by law. Lego toy
company has adopted various measures to protect their trademark and product. Economic factors
have given opportunity to Lego company to sale there product all round world. They produce
products according to different culture (Lendrum and Wittemyer, 2018.). Lego has gained vast
experience because of wide diversification. They has advantage of lower priced market. This
company has kept price stable as compared with competitive. Average price help to maintain
balance in transaction. This group is planning to expand there business overseas. Establishing
business all over the world will help them to increase customer base. Due to lack of innovation
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this company has lost market share. After this downfall, they have introduced toys with specific
design and colour. World Wildlife Funds was introduced by Lego group to reduce carbon
emission. This groups aims to reduce pollution in environment (Carroll and Buchholtz, 2014).
Manufacturing plant release carbon, which are very harmful for environment. Lego company has
adopted methods to control carbon release in environment. This group has been successful in
controlling smoke emission in environment. Lego toy company maintain online relation with
there clients. They use various social media site to stay connected with customers. Lego
company upload toy online on company website. This has provided customers with facilities to
view and buy product online (Lindgren 2017). Company has adopted online marketing strategy
to increase sale. With help of official website, company can easily inform customer about new
toy launch. Technology provide easy payment options, customers can order and make payment
online. With help of easy monthly instalments (EMI) customers can now easily afford products.
CONCLUSION
This report is discussed about the different type of organization and their scope in the
business development. There are different organization such as public, private and voluntary
which is divided according their structure and functionality. Positive and Negative factor is
impact on the macro environment because this factor is influence to change the business
operations and functions. Lego is a leading organization which is using different pestle analysis
to identify the business requirement and it also analyses the external and internal analysis of this
organization which is helpful for organization to expand their business and also understand the
need of resources which is essential for growth and development. This report is also analyse the
weakness and strength of this organization. Every organization needed to develop an effective
planning to identify the strength and weakness of organization.
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