Understanding the Business Environment

This assignment content comprises a collection of books, journals, and online articles that provide insights into various aspects of business, including competitive analysis, research methods, process change, corporate social responsibility, internationalization, statistical quality control, strategic management, consumer behavior, innovation, private global business regulation, and sustainable development. The texts explore the nature and significance of the business environment, its types, market structures, and the determinants of price and output in perfect competition. Overall, this content offers a comprehensive understanding of the complex dynamics that shape businesses and their environments.

BUSINESS ENVIRONMENT

Table of Contents
TASK1.............................................................................................................................................1
TASK2.............................................................................................................................................3
TASK3.............................................................................................................................................4
REFERENCES................................................................................................................................6

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Overview of analysis
Business environment is regarded as the means of all the internal as well as external
factors that influence the manner in which business operates involving employees, customers,
management, supply, demand as well as regulations of the firm (Harrison, 2013). In the present
study the business environment has been discussed in context of smartphone industry. The report
includes environmental audit of the smart manufacturers. Further it involves the impact of
environment on the firms.
Smartphone manufacturers
Smart phone is considered as the advanced mobile operating system that possess features
of both personal computer as well as operating system with other features that are beneficial for
the mobile or handheld usage. They are pocket sized having features of cell phone that includes
the capability to place as well as receive voice calls as well as create and receive test messages
with those of the well known mobile devices (Reed and et. al., 2013). There is presence of
several firms that are engaged in manufacturing smart phones. This is composed of Nokia,
Samsung as well as Apple. Today there is greater demand for the smartphones in the market.
This acts as an aid for the manufacturers in increasing their sales as well as profitability to a
greater extent.
TASK1
Macro environmental analysis on the business environment of smartphone manufacturers in UK.
 Political factors: Some definite examples of these factors with reference to the
smartphone industry of UK in context to a selected organisation named Apple is as
mentioned below-
◦ Factor 1- A foremost political constituent that has made a substantial effect on the
smartphone industries of UK is a prior association of Bretix law (Solomon, 2014).
The policies related with trading has huge impact on the smartphone manufacturer in
terms of operating within UK.
◦ Factor 2- Another factors is relates with the changes in the structure and process of
the government which affects the smartphones industry (Beaumont, WHITAKER and
PEDERSEN, 2013).
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◦ Factor 3- The eventual element has been showcased as an enormous dependency of
Apple on a low cost manufacturing deal with China (Johnson and Turner, 2015). In
relation to which, restricted import of Chinese goods in UK can make a drastic
change in the price topology of Apple's commodities. The factor such as War and
conflicts can affects the operations of the business.
 Economical factors: Below three factors are defined to be some crucial depiction of
economic stipulation in Apple-
◦ Factor 1- A foremost factor is demand and supply of cell phones by Apple has been
taken into a valid consideration. It is in case the demand of phones will raise, them
the cited entity may charge high prices for it (Hamilton, L. and Webster, P., 2015).
However, in case the demand is lower than the supply, then the entity will not be able
to avail high prices of their smart phones.
◦ Factor 2- Another factor is yet again based upon an increasing dependency of Apple
over China where a rising labour cost can drastically impact upon some deliberated
cost benefit of Apple (Donaldson and Marais, 2012). Another significant component
that in this particular section of political factors is currency fluctuation due to a newer
comrade of their Bretix law that ruled over their preliminary association with EU
laws
◦ Factor 3- A strengthening value of US dollar is yet another relative factor with a
simultaneous increase in the exchange rates. This is turn is reflecting a more
expensive consideration of operating the business in some of its key market arenas
like China and Europe (Ferraro and Brody, 2015). The general taxation issues has
potential to affect the operations of the firm.
 Social factors: These factors investigate the social environment of the market and judge
some significant factors like demographics, cultural trends and population analytics, etc.
It includes what people prefer in a particular city or country.
◦ Factor 1- Apple is mostly composed of young age consumers who lack in emotional
attachment and due to which, the sale of commodities is relatively lessened by the
cited firm (McAdams and et. al., 2015). The lifestyle trends of the individual has
greater impact on the sustainability of Apple as it is one of the luxury brand of
smartphone manufacturing.
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◦ Factor 2- Some ethical concerns depict another major factor of Apple in this segment
where Apple's enormous dependency in China tends to limit the appealing
constituents of their products (Fleisher and Bensoussan, 2015).
◦ Factor 3- Another subsequent factor is also in regard to specify the close association
of Apple with China where a rising tension among the European nations with China is
offending the potential clients of UK (Gaskill, Van Auken and Kim, 2015).
 Technological factors: Below are the technical factors that are required to be considered
by Apple-
◦ Factor 1- Apple in every few months should include a new feature in their
smartphones to correspond their manufactured products with the recent up-gradations
in UK market (Dettwiler, Lindelöf and Löfsten, 2006). The competing technological
development within UK is affecting the operations of the business to a significant
level.
◦ Factor 2- Another technological factor in correspondence to Apple is an emerging
demand of smartphones and tablets that has simultaneously reduced the use of
desktop computers manufactured by Apple (Baron, 2003). This has been assessed that
associated technology assist in offering greater convenience to the customer as they
can carry out their work from any location.
◦ Factor 3- An increasing ratio of cyber crime is yet another relative factor that could
lessen the secured perspective of Apple's manufacturing. This can also take away the
contending benefit of Apple by together rupturing their reputed status of high level
safety (Didonet, S. and et.al., 2012).
 Legal Factors: A legal analysis therefore includes labour laws, safety standards,
consumer laws and workplace standards, etc.
◦ Factor 1- It is in association with a recent formulation of Apple in providing financial
assistance to the users that could lead to an increased level of legal proceedings by the
designated venture of smartphone (Fernando, 2011). The penalties involved in
infringing the laws has greater impact on the operations of the firm.
◦ Factor 2- Another factor is in association to an augmented state of regulatory systems
with accrued regimental supervision due to a prior entrance in fiscal services by
Apple (Hair, 2015).
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◦ Factor 3- An eventual factor is also in relation to determine yet another prudent
planning of Apple to enter in the auto-mobile industries of UK. This could
tremendously raise their litigation cost by together raising their existent regulatory
systems with high maintenance of insurance and other relative measures (Hamilton
and Webster, 2015).
 Environmental factors: In context to it, the manufactured products of Apple should
hereby depict an environment friendly and standard quality.
◦ Factor 1- A leading dependency of Apple on data centres and internet substructure is
insignificantly assailable to Apple where it leaders to higher expenditure of electricity
costs (Hamilton and Webster, 2015).
◦ Factor 2- A disrupted trans-ocean shipping due to a rising factor of global warning is
continually changing the environment by affecting the supply chain management of
UK (Harmon, 2014).
◦ Factor 3- Another leading factor of environment that is constantly interrupting Apple
is disposition of their non working electronic devices that is also referred to be
another atrocious cause of increasing their functional expenditure (Pace, F. L., 2011).
TASK2
Macro environmental analysis is enumerated in the manner as under:
 Political:
Factor 1: Taxation policies of UK along with their distinct employment laws and stability in
regimental parties, etc. are political factors (Xahir, 2012). These decisions significantly impacts
upon the pedagogy of employees, national health and quality of economical infrastructure like
roads and railways, etc.
Factor 2: However, in context to smartphone industries, it together impacts upon the active
industries of smartphones in some vital segments of work allotment to the employees, sales of
products in national and international markets, etc.
 Economical:
Factor 1: These factors tends to determine the economic performances of the nations in which
the smartphone manufactures have established their market set up. These factors mostly includes
any fluctuated rate of interests, inflation rate, patterns of economic growth and foreign exchange
rates, etc. (Welford, 2013).
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Factor 2: In context to which, in case of high inflation rates it would directly affect the pricing
strategy of Apple. Furthermore, it would also make an equivalent effect on the purchasing power
of consumers that will in turn change the economic structures of demand/supply as well. FDI is
also depicted to be another major factor of influence that has been taken into account after
evaluating the dependency of the present industrial structure.
 Social:
Factor 1: Cultural trends however keeps on changing with the altering mode of fashion. In
relation to which, a fine maintenance of product quality will hereby aid the quoted firm to
increase their brand value for customers by together promoting their brand image.
Factor 2: Today's increased buying power of consumers depicts their luxurious preferences
where they are enough capable of buying high priced phones. The changing taste and preferences
showcases a distinct choice of today's customers where Apple can make a substantial use of the
same. This directly affect the business of smart phone industries in UK where Apple is an active
participant of it.
 Technological:
Factor 1: Inflation rates have immense influence on the pricing strategy of the organisations
(Johanson and Vahlne, 2009). The smart phone industry is working well as people are dependent
on phones. Today everything is on mobile phones- calendar, important notes, various
applications, communication tool and many other features (William Pollard).
Factor 2: New technology is vibrantly entering into the markets that is referring to update the
products manufactured by smartphone industries. It is therefore essential for Apple to cop up
with the altering trends of technology (Cantwell, Dunning and Lundan, 2010). Organisations
who keep an updated version of technology in their manufactured goods and services together
gains a competitive advantage.
 Legal:
Factor 1: This includes both internal as well as external constituents. In context to which,
companies like Apple have certain intrinsic laws to operate in a sophisticated environment of
work culture (Wetherly and Otte, 2014). However, the extrinsic laws are given by the
constitution to maintain the legal requisitions of operating a well structured establishment in the
chosen marketplace that together depicts well defined rules and regulations of the nation. In
designing phones, laws and procedures should be strictly followed.
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Factor 2: Strategical planning should be made stronger in order to compete with the other
organisations (Carroll and Shabana, 2010). In the current scenario, consumers have adapted the
culture of having new features added to the phones in every 5-6 months and therefore, they
demand the same now. In this way, all the factors help in maintaining the brand image and
helping the organisation to retain in the market.
 Environmental:
Factor 1: Environment safe products should be made to maintain brand image and give value to
customers. It helps in retaining customers when company assures safety and quality. These
factors are those which are determined by the environmental surrounding of the organisations
like Apple (Vogel, 2008).
Factor 2: It is an important aspect for smart phone manufacturers. These factors include weather,
global climatic changes, geographical location, natural resources, recycling and waste disposal
procedures, etc., (Teece, 2010).
TASK3
The two important factors that have a significant impact on the smart phone
manufacturers in UK are as follows: Governmental Policies: To mange the business functions is very important task. The
government and regulatory authorities are having vital role in affecting the business.
Time to time the laws are changed and modified, the company has to mould the
principles of it accordingly. The recent trends and governing authorities are the key
elements of influencing the business (Welford, 2013). To work with legally is the
obligation of the entity. But when the legal litigations changes they directly influence the
trade policies. Thus, it can be concluded that the governmental policies and regulatory
terminologies are also liable to impact the trade operations. The government can regulate
any particular rule and all the companies will be held liable to follow those principles,
this can stop the workings of the corporate and can create the big problems for the
business owners.
 Sustainability trend: The firm like Apple is addressing the opportunity that relates with
maintenance of the business sustainability by the means of recycling as well as related
programs. Along with this the company is seeking for new technological solutions in
order to enhance energy efficiency of products of Apple (Wetherly and Otter, 2014). This
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includes improvement in batteries, processors as well as components that are engaged in
emission of heat. Apple is one right track in addressing opportunities that based upon
ecological factors within its macro environment. The smartphone manufacturer like
Apple is taking comprehensive approach towards reducing environmental issues and
taking responsibility towards environment in serious manner. The firm has not reported
for carbon footprints but it has kept management towards reducing footprints. The
strategy of the organization involves disposal off the waste is proper manner, reducing air
and water pollution. Not only such but organization is working towards recycling
electronic equipments (Rothaermel, 2015). Apple is on track towards consuming energy
from solar, geothermal as well as hydro sources. The viable approach of the firm is
because of its strategy for health consciousness which is being assessed within legal and
socio-cultural impacts.
In this way these two factors major affect the smart phone manufacturers in designing
their strategies and production of their products. Keeping in mind all these components can help
them grow at a greater pace. It also helps in capturing the market and retain customers. Grabbing
people's attention every time an organisation positions or re-positions a product is important.
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REFERENCES
Books and Journals
Baron, D. P., 2003. Business and its Environment (p. 2). Upper Saddle River, NJ: Prentice Hall.
Beaumont, J. R., WHITAKER, B. and PEDERSEN, L., 2013. Managing the Environment:
business opportunity and responsibility. Elsevier.Cavusgil, S.T. and et.al.,
2014. International business. Pearson Australia.
Cantwell, J., Dunning, J. H. and Lundan, S. M., 2010. “An evolutionary approach to
understanding international business activity: The co-evolution of MNEs and the
institutional environment”. Journal of International Business Studies. 41(4). pp.567-
586.
Carroll, A. B. and Shabana, K. M., 2010. “The business case for corporate social responsibility:
A review of concepts, research and practice”. International journal of management
reviews. 12(1). pp.85-105.
Darnall, N., Henriques, I. and Sadorsky, P., 2008. “Do environmental management systems
improve business performance in an international setting?”. Journal of International
Management. 14(4). pp.364-376.
Donaldson, R. and Marais, L., 2012. Small town geographies in Africa: experiences from South
Africa and elsewhere (pp. viii-xviii). New York: Nova Science Publishers.
Fleisher, C.S. and Bensoussan, B.E., 2015. Business and competitive analysis: effective
application of new and classic methods. FT Press.
Hair, J.F., 2015. Essentials of business research methods. ME Sharpe.
Harmon, P., 2014. Business process change. Morgan Kaufmann.
Harrison, A., 2013. Business environment in a global context. Oxford University Press.
Jenkins, H., 2009. “A ‘business opportunity’model of corporate social responsibility for small‐
and medium‐sized enterprises”. Business ethics: A European review. 18(1). pp.21-36.
Johanson, J. and Vahlne, J. E., 2009. “The Uppsala internationalization process model revisited:
From liability of foreignness to liability of outsidership”. Journal of international
business studies. 40(9). pp.1411-1431.
Montgomery, D. C., 2009. Statistical quality control (Vol. 7). New York: Wiley.
Reed, O.L. and et. al., 2013. The legal and regulatory environment of business (p. 328).
McGraw-Hill/Irwin.
Rothaermel, F.T., 2015. Strategic management. McGraw-Hill.
Solomon, M.R., 2014. Consumer behavior: Buying, having, and being. Engelwood Cliffs, NJ:
prentice Hall.
Teece, D. J., 2010. “Business models, business strategy and innovation”. Long range planning.
43(2). pp.172-194.
Trkman, P., 2010. “The critical success factors of business process management”. International
journal of information management. 30(2). pp.125-134.
Vogel, D., 2008. “Private global business regulation”. Annu. Rev. Polit. Sci. 11, pp.261-282.
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Welford, R., 2013. Hijacking environmentalism: Corporate responses to sustainable
development. Routledge.
Wetherly, P. and Otter, D., 2014. The business environment: themes and issues in a globalizing
world. Oxford University Press.
Wiklund, J., Patzelt, H. and Shepherd, D. A., 2009. “Building an integrative model of small
business growth”. Small Business Economics. 32(4). pp.351-374.
Online
Business Environment: Nature and Significances of Business Environment, 2016. [Online].
Available through: <http://www.yourarticlelibrary.com/business/business-environment-
nature-and-significances-of-business-environment/23367/>. [Accessed on 24th October
2016].
What is Business Environment? Explain its typest, 2016. [Online]. Available through:
<http://www.mbaofficial.com/mba-courses/business-environment/what-is-business-
environment-explain-its-types/>. [Accessed on 24th October 2016].
Xahir, A., 2012. Market structures- price and output determination in perfect competition.
[Online]. Available through: < http://ec.europa.eu/competition/consumers/why_en.html
>. [Accessed on 3rd November 2016].
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