An Introduction to the Business Environment

This document provides an introduction to the business environment, discussing the types of businesses (public and private) and their stakeholders. It also explores how public and private companies are organized and their objectives. Additionally, it examines the factors affecting the businesses of NHS and JCB.

BM301: An Introduction to the Business Environment
QUALIFI Level 3 Diploma in
Business Management

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Assignment
Title
An Introduction to the Business Environment
Task 1 (350 Words)
There are 2 types of business mentioned as below
Public Companies- It consists of the companies that are owned and operated by the
government of that country. Companies in the public sector does not seek to generate profits.
Purpose of public sector is to provide public service which is the best service at any cost. It
helps the government to enforce social control over trade and industry for ensuring that there
is equitable distribution of goods/ services (Abdolmohammadi,2017).
Business sectors of public sectors include sectors such as military, infrastructure which can
be public transports, bridges, telecommunication and various others. They are run by the
government which operate with the money raised from taxes collected from the public
(Abdullah,Ardiansah, Hamidah, 2017). Stakeholders of the public companies are
government which can be at local, regional and central level.
Example of public company in UK is National health service which is publicly funded
healthcare service in England which provide healthcare service to people of UK where its
purpose is to improve care quality which helps to create the safest, highest quality of health
and care services.
Private Companies- These companies are the part of economy which are run by individuals
and companies for profit making and are not under the control of any government. It
encompasses all businesses run for profit that are not owned and operated by the
government. Companies run for the purpose of making Profits (Ceustermans, Breesch,2017).
Ownership is defined by share capital where the shares are equal part of companies capital.
Stakeholders in private companies include founders and owners of the company, employees,
competitors, investors, creditors and many others. Private companies can be found
everywhere in every sector of business as their main motive is to money from public.
Example of private company in UK is JCB where the business activity of the company is to
manufacture equipments for agriculture, construction, waste handling and other. Purpose of
the company is to grow its business by delighting its customer by delivering first class
customer care.
Stakeholders Influence- Business have different internal and external stakeholders who
influence purpose of both the organizations. These are owners of both the company who
influences how the aims to be achieved and decisions to be made.
These are the customers of both the company as businesses can't ignore them as they will
find loosing them to rivals which affect the companies purpose.
Employees of both the company influence the purpose for which it exists as they are the one
who are directed to achieve business objectives of company.
Suppliers/Vendors& Distributors are external shareholders that influences the purpose of the
company as they can sometime provide best prices with large customer base that in turn
meets business purpose.

Task 2 (500 Words)
The below two business are organized in way as mentioned below:
Public company (Example NHS)- Public companies such as NHS are organized in proper
way where the government of the company follows more divisional structure, with various
departments and commissions divided by the type of work they are supposed to do
(Panisi,Buckley, Arner, 2019). In the above example of NHS The Department of Health is
the government department responsible for funding and coming up with policies that work at
local and national level. The company is organized in a way that it helps every individual
from each department to participate in the decision-making process of the company. Chain
of command is clearly defined in public companies like NHS. The stocks of the company are
intended to be freely traded on stock exchange by public where the activities are organized
to fulfil needs of customers by providing excellent services and not with an intention to
make profits (Fujianti,2018).
Private company (Example JCB)- Private companies such as JCB is organized in a way
where decisions and communication flows from the Managing director of the company to
CFO, CEO, CMO and others to respective department managers to the assigned teams of
their in the company. Private companies like JCB are organized in a way where its finances
are separated from owner finances as they are based on the concept of separate legal entity.
Decisions are under the control of top authorities for which all the people of the company are
abided to follow. Activities of the company are directed towards making profit (Zhou,2020).
Different types of business targets/ objectives-
Business target varies from business to business. Objectives for public company like NHS is
to provide services to its citizens at reasonable cost and to maximize shareholders value by
generating profits to them. The main target of public companies is to help government to
enforce control on trade and industry to ensure equitable distribution of goods and services.
The objectives of the private limited company is to generate profits (Busco, Grana, Izzo,
2019). Target of private company like JCB is to generate huge customer base which helps
them in meeting their purpose. Target of this company's is also to the market leader where
the company want to be first priority in the minds of its customer. Objectives of companies
is to generate high sales volume by providing high quality products and services and beating
its competitors.
The targets are achieved by the company's in the way as the companies continuously work
on building relationships with customer where it delivers products and services according to
the needs of the customer which helps company in retain loyal customers and building trust.
The companies achieve target as they come with innovation to meet customer requirements
accordingly. They achieve their target by doing research which can be by doing SWOT and
PESTLE analysis of their products/services (Melnik, Ermolaev,Kuzmin,2019 ).
Companies like NHS & JCB achieve target by reviewing their past performances and
improving on the factors they lack to avoid future contingencies.

Task 3 (150 Words)
Factors affecting the businesses of NHS & JCB
NHS- Political factor affected the business of NHS severely when UK was facing the
situation of Brexit as being a public institution, separation from EU have a deep impact on
its functional capacity. It impacted the business as it was earlier shipping many medicines&
equipments from other parts of EU (PESTLE Analysis of the NHS.2020).
Legal factor affected NHS as the patients who were not happy with the care of NHS as they
believed medical system was unjust were taking grievances on legal platforms where NHS
faced various litigation cases from unhappy customers.
Social factor affected NHS as average population of UK is increasing which leads to health
issues in old age leading NHS with pressure to provide quality treatment for growing case.
JCB- Political factor affected JCB in a way where UK showed hike in taxes and
implemented new legislation conservatives which might affect the buying power of
customers.
Legal factor affected the business as it operates in several countries where it is abided to
follow rules and regulation prevailing such as employment rules, labour laws etc.
Social factor affected business as it is operating in different countries where it follows
different societies culture, attitude, religion and value where the company has hard time to
avoid any kind of discrimination (Objective of JCB,2020).

REFERENCES
Books& Journals
Abdolmohammadi, andet.al., 2017. Factors associated with internal audit function
involvement with XBRL implementation in public companies: An international
study. International Journal of Accounting Information Systems.25. pp.45-56.
Abdullah, M.D.F., Ardiansah, M.N. and Hamidah, N., 2017. The Effect of Company Size,
Company Age, Public Ownership and Audit Quality on Internet Financial
Reporting. Sriwijaya international journal of dynamic economics and business.1(2). pp.153-
166.
Busco, C., Grana, F. and Izzo, M.F., 2019. Integrating sustainable development goals within
companies’ decision-making process. The role of integrated thinking and reporting.
Ceustermans, S. and Breesch, D., 2017. Determinants of voluntary disclosure of sales in
small private companies in Belgium. Journal of International Financial Management &
Accounting. 28(2). pp.172-204.
Fujianti, L., 2018. Top management characteristics and company performance: An empirical
analysis on public companies listed in the Indonesian stock exchange.
Melnik, A.N., Ermolaev, K.A. and Kuzmin, M.S., 2019. Mechanism for adjustment of the
companies innovative activity control indicators to their strategic development goals. Global
Journal of Flexible Systems Management.20(3). pp.189-218.
Panisi, F., Buckley, R.P. and Arner, D.W., 2019. Blockchain and Public Companies: A
Revolution in Share Ownership Transparency, Proxy-voting and Corporate
Governance?. Proxy-Voting and Corporate Governance, pp.19-100.
Zhou, Z., andet.al., 2020. Study on the networked integration model and its efficiency of
private company taking part in state-owned company mixed ownership reform. International
Journal of Engineering Business Management.12. p.1847979020932731.
Online
Objective of JCB.2020[Online]. Available
through<https://myassignmenthelp.co.uk/freesample/objective-of-jcb>
PESTLE Analysis of the NHS.2020[Online]. Available
through<https://www.marketingtutor.net/pestle-analysis-of-the-nhs/>