Business and Business Environment

Business and Business
Environment

Table of content
INTRODUCTION...................................................................................................1
SECENERIO AND ACTIVITY 1..........................................................................1
Different types and purposes of organisations with their legal structures...................................1
Difference between profit, not profit and non governmental organizations................................3
Difference between micro, small and medium sized enterprise..................................................3
Interrelationship of different organisational functions................................................................5
SECENERIO AND ACTIVITY 2..........................................................................6
Macro environment analysis by using PESTEL framework.......................................................6
Micro environment analysis by using Porter;s five force model.................................................8
VRIO analysis of company in term of find out strengths and weaknesses.................................8
SWOT analysis of the company to highlight its strengths, weaknesses, opportunities and
threats...........................................................................................................................................9
CONCLUSION......................................................................................................10
REFERENCES......................................................................................................11

INTRODUCTION
Business and business environment indicates to the environment of a business in which a
company its business activities and operations. It can be the surroundings that is connected to all
the components and elements that either influence or create impact on the working and
functioning of a firm. Moreover, it is an essential factor to an organisation to determine its
environment as it offers a prominent insight to organisations in relation to these aspects because
it help in maximising the scope of development when comes to formation of strategies and
operations (Alsaad, Mohamad and Ismail, 2017). In context of it, the report is supported to
Halifax Bank which is a British banking brand operating company. It was incorporated in 1853
and headquartered in West Yorkshire, UK. In this relation, the written document will covers
effective insight on business environment, explanation of size and scope of firm and interrelation
among its different business functions that are connected to organisational structure. Along with
this, it also undertakes utilisation contemporary examples in order to present different
components that create favourable and unfavourable impact upon the business function of the
firm. In addition to it, internal analysis also discussed along with interrelation with external
analysis.
SECENERIO AND ACTIVITY 1
Different types and purposes of organisations with their legal structures
Organisation can be explained as a unit of organised people that has a common motive
and accountability to accomplish all over objectives of a venture. Majorly, there are three types
of companies which have different purpose and legal structure that are private, public and
voluntary enterprises (Explain the different types, size and scope of organisations, 2020).
Private company- It can be explained as any individual, partnership, corporation and agency
that is not a public company and the motive of it to earn profit. These kind of companies are
responsible to take their decision own-self and they have not any kind of government
involvement (Ayatse, Kwahar and Iyortsuun, 2017). Halifax Bank is the example of this kind of
firm that is a UK based banking company.
Purpose of Halifax- The major motive of respective company to offer quality and
effective financial products and services to customer and becoming the first bank for customers.
1

Legal structure- Some of particular legal structure that is followed by diverse
organisation to carry on its business actions and operations (Cepel and et. al., 2018). The legal
stricture of private sector company can be acknowledged by following mentioned points:
Sole proprietorship- In this legal structure, an individual operates the us8iness of the
entire company and is the single owner of the firm. The owner as limited freedom over business
determinations and the risk and treat is high ion such companies. Sole proprietorships are easy to
set up and usually only need a small influx of initial asset. It is common for SMEs to assume a
sole proprietorship status during the initial period of their operations. Business overheads are
usually minimal due to the small size of the enterprise, but if the business is unable to make a
profit and keeps accruing debt, the owner is exclusively liable for any outstanding debts. The
main advantage of sole proprietorship is that this kind of business can be start with fewer
amounts and an individual can operate and set up this business simply. The main drawback that
is faced by person is difficulty in raising investment capital to start business. There is no business
write offs.
Partnership- It can be mentioned as an agreement or contract that can be take place
among two or more people that work together to accomplish the set business objectives. It is
essential to point of that not all partnerships have unlimited liability, limited liability partnership
are now becoming highly common. The advantages are that it is easy to start and profits and
losses both are wear by parterners. The main limitation o this kind of business is that there are
instability, unlimited liability, lack of harmonery and limited fund to operate business.
Limited liability companies- These kinds of enterprises have different owners and
revenue that are generated from these companies are segregated among all the owners. When
companies are formed, they must have a constitution that will assist the shareholders and director
regulates their relationship. The main benefits of this business that there is no restrictions on the
number of members and company has flexible structure. The drawback of this business is that it
consume more cost in comparison to sole proprietorship and pay more tax in compare to limited
liability company.
Public company- it refers to those organisations that are governed by national authorities of
countries an motive of them to provide services to the community and society (Explain the
different types, size and scope of organisations, 2020). The main purpose of them is not earn
2