Business Environment & Strategic Management

This assignment delves into the dynamic nature of the business environment and its influence on strategic management. It requires students to analyze various internal and external factors affecting a business, using relevant models and frameworks like SWOT analysis. The goal is to demonstrate an understanding of how businesses can effectively assess their position within the market and develop strategies for success.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purposes of organisations.......................................................................1
P2 Size and scope of various type of organisations....................................................................4
TASK 2............................................................................................................................................6
P3 Relationship between different organisational functions.......................................................6
TASK 3............................................................................................................................................9
P4 Positive and negative impact of macro environment upon business organisation.................9
TASK 4..........................................................................................................................................10
P5 Studying on internal and external analysis..........................................................................10
P6 Ways in which strengths and weaknesses interrelate with macro factors............................12
RECOMMENDATIONS...............................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Business environment includes entire intrinsic as well as extrinsic elements which will
provide impact on operational activities of business in a direct or indirect manner. It is must to
examine demands and needs of each clients; therefore company will accomplish it in an adequate
way (Drucker, 2017). It is required for a firm to attain coveted targets within limited period of
time because this assists them into their success and growth. Present assignment is based on
Coca cola which is a multinational company. They are providing their goods and services to
customers since 1987 and in addition there main item is carbonated soft drinks. This report is
going to define about size, purpose, scope and legal structures of distinctive sort of associations.
Moreover, relationship amongst functions of company and their connection with business
targets. Instead of all of this, macro surrounding will get impacted either in a positive or negative
way; therefore, manager needs to study it adequately.
TASK 1
P1 Different types and purposes of organisations
Many kinds of companies are doing their work in distinctive segments; thus, they will
easily acquire maximum revenues to accomplish their desires (Charter, 2017). This will be
discussed by taking an example, like a NGO, they complete their task as a part where they run
their firm to provide benefits to society without taking care of revenues. Their main work is to
improve living standard of individuals. Furthermore, there are many other companies who are
running their business; so that, they will earn maximum profits. This sort of affiliations will be
either public or private. This will be stated as beneath:
Basis of comparison NGO NPO For Profit
Meaning These types of firms
are formulated by
people so that they
will provide social
welfare to people or
society (Kew and
Stredwick, 2017).
As indicated by this, it
will be established to
provide the best goods
as well as services to
users which will assist
in their improvement.
Members of this kind
Main purpose to
develop these firm is
to earn maximum
profits. For this
purpose, company will
sell their items and
services to people at
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Fundamentally, it is
developed by an
independent person.
of association will
never share revenues
amongst them.
marketplace.
Operations area Large Prohibited This will be either
large or restricted.
Objectives They cater social
welfare to society
which will assist them
into their growth and
advancement.
There main target is to
promote commerce,
art and science (Voigt,
Buliga and Michl,
2017).
They want to
accomplish needs and
wants of their clients
as per their
requirement; thus, they
will compete their
rivals at competitive
world.
There are three foremost segments which are stated as beneath:
Public Sector: This sort of companies is basically developed by regulatory bodies and in
addition, they share their profits amongst their members as per decided ratio (Ji-fan Ren and et.
al., 2017). There fundamental department is known as finance which is developed through the
persons of nation in the kind of tax or may in some other form. Government has to formulate
some rules as well as policies for the nation which has to be followed by people or business
person. Example: M & S is a public firm and their main purpose is to accomplish requirements
of middle class individuals and for this, they provide them products at reasonable prices.
There is some purpose of them which are described as below:
 Main aim is to render improvement to UK economy by providing welfare to backward
classes.
 They will give some employment opportunities to people which will assist to improve
their living standard. Company wants to reduce poverty line of country (Galea, 2017).
Advantages Disadvantages
 Firm has to secure employee's interest.  It is not easy to manage this sort of
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 Their main aim is to provide benefits to
overall public.
association in an adequate way.
 Effectiveness of management is less in
comparison to private sector (Linder
and Williander, 2017).
Legal Structure: This will comprise: State government: It is totally a distinctive firm and they accomplish their work as per the
principles of regulatory body. They provide education to children and create a proper
control on activities of college. Central government: They regulate country by formulating some policies and
regulations. Their fundamental aim is to collect tax in addition to print money for society.
 Local government: These types of firms are basically created for the small scale, such as
town (Linnenluecke, 2017). They will prepare policies for a specific segment only which
has to be taken after by people who are residing over there.
Private Sector: This type of company is not run as well as regulated by ministry body.
But it is necessary for people who are running association to follow those rules and regulations
which are formulated by government. Rather than all of this, they have a power to enlarge their
business as per their wish or without any obstructions. Main aim of company is to improve their
profits and for this purpose, they have to capture attention of numerous people by providing
quality goods and services to them. For example: Waitrose is a MNC which is selling their items
across the world to earn higher profits.
Therefore, there are some purpose of it, which are described as below:
 It is must for manager to evaluate demands and needs of clients; thus, they will cater
satisfaction to them by accomplishing their demands (Luftman, Lyytinen and ben Zvi,
2017). As a result, they will pull numerous individuals towards them which aid them to
take benefits from their rivals at competitive world. They have to develop good quality items for their clients which assist them to improve
their reputation at marketplace.
Advantages Disadvantages
 There are lots of opportunities for them  High competition.
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at market to expand their business.
 This kind of associations are more
adequate and effective.
 Lack of job security (Boo, 2017).
Legal Structure: It will consist: Sole proprietorship: As indicated by this, it is basically run as well as owned by an
individual. Entire loss as well as profit is taken by him only.
 Partnership: In this, two or more people come together and form a business by mutual
consent (Borman, 2017). They will prepare a partnership deed which will consist of their
share, profits, capital and many more things. This type of firm is established to attain the
common goal.
Voluntary Sector: These companies are fundamentally developed by people so that they
will cater social welfare. This will assist individuals to improve their living standard. For
example: Oxfam, they are working to provide benefits to people which help them in their
development and advancement.
There are some purpose which is related to this:
 Their main aim is to provide growth and development to people which will help them to
improve their living standard.
 They never share their profits amongst their members (Kasemsap, 2017).
P2 Size and scope of various type of organisations
Each and every kind of company has their own size which will help to determine their
share. Therefore, there are some organisations as per their size is mentioned as beneath: Micro scale: Nature of this sort of firm is very small and in addition, few individuals are
employed here. There are some examples which are associated with this, such as garage,
shops and so on. They will not able to gain higher profits but their foremost motto is to
provide protection to their family (Yin, 2017). Instead of all of this, there are some other
examples of it, such as mobile store, grocery, fast food outlet and many more. Small Scale: As indicated by this, in this kind of company number of employees are not
more than fifty and along with this, their revenue is almost or less 5 million $. In UK,
there are numerous firms who are doing their business at small scale; therefore, market
share is high of these organisations. They provide many employment opportunities to
people of nation which help them to improve their standard of living. More than 85%
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individuals are occupied into this type of affiliation. Small supermarket as well as grocery
stores are some essential examples of it. In this, 15 – 25 peoples are employed. Instead of
this, those industries which are producing common item will be taken into under
consideration as a small scale business. Their main concentration is to enlarge their firm
to occupy maximum share of market (Foss and Saebi, 2017). Medium Scale: According to this, approximately fifty to two hundred fifty individuals are
included. There profits are nearly five to twenty three million $. These all will aid to
determined that organisation is working as a medium scale. There is an example
associated with it that Exponential-E is a firm where almost 145 persons are employed.
They are accomplishing to attain common targets in an effective way. Large Scale: In this type of company more than two hundred fifty people are occupied
and earning more than 250 million $. In UK, there are many sort of organisations who are
doing their business at this scale. Such as Tesco, they are providing their products and
services across the world and having more than 900 staff members (Zaman, 2017).
Objectives:
Micro Small Medium Large
Fundamental aim of
this kind of firm is to
cater financial
protection to their
family; therefore, they
will keep up their
standard of living.
There essential target
is to maintain an
effective livelihood.
Along with this, by
getting some
opportunities they will
enlarge their business
and for this, some
appropriate methods as
well as techniques will
be utilized by them.
They want to increase
their firm at a global
level because it assists
them to enhance their
customer base. For
this, they will use
some methodologies,
such as joint venture,
merger, acquisitions
and many more.
To survive at
marketplace for longer
period of time, it is
needed for them to
accomplish CSR
activities. Along with
this, it is must for them
to assist government to
improve economy of
country.
Instead of all of this, there are some scope which are associated with distinctive sort of
company is mentioned as beneath:
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 Micro Scale: They have very less circumstances for expansion of their business, because
they are tiny as per their nature and motto is to survive at marketplace (Michalos, 2017).
Along with this, they do not have sufficient fund to expand their business. But they will
do it like open a new outlet in the same town. Small Scale: Chance to enlarge their business is much high as comparison to micro firms.
Scope is high and they will utilize some methods as well as techniques into their
business. If they want to improve their reputation then, they will give a franchisee of their
business to some other people. Medium scale: They have higher chances to expand their business at international level;
so that, they will run their business in some another nations (Buckley, 2017). For this, it
is must that their license for export has to be approved by country's regulatory body. Large scale: It is essential for them to follow all rules and regulations to conduct
business; thus, they will improve economy.
Transactional Company:
It is considered as a much wide organisation and they are operating their operational
activities in various nations. Profits of company is much high as comparison to the nation's
economy. Therefore, it has been comprehended that transactional associations have direct
influence on the economic circumstances of nation. Like an example: present assignment is
based on Coca cola which is a transactional firm and in addition they sell carbonated soft drinks
to people. Profits of company is almost 41 billion dollars in the year of 2016. it can influence
straightforwardly to economy and will aid in improvement of state or nation (Rauter, Jonker and
Baumgartner, 2017).
TASK 2
P3 Relationship between different organisational functions
There are many sort of sectors within company which can affect in a direct or indirect
manner to the operations as well as profits of firm. It can be stated as beneath: Marketing: It is the foremost factor which has to be taken into under consideration to
attain coveted targets as well as goals of an enterprise. In the relation of Coca cola, by
utilizing strategies of marketing they will improve their sales of goods and services and in
addition capture attention of numerous people. Instead of all of this, company will alter
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their products which will also aid to attract individuals and in addition, this will provide
long effective to their goods (Gurung and Prater, 2017). With assistance of strategies of
marketing, they will achieve their coveted targets as well as goals adequately and will
acquire maximum profits. This division is fundamentally associated with finance unit as
after implementation of it they will get requisite amount to do planning for their business. Human resource management: There main purpose is to look at the blank place in firm
and fill it through enlistment of new individual. It is must for them to cater comfort to
them; therefore, they will complete their work by follow ethical norms. Along with this,
it is required for them accomplish needs and wants of their staff members; so that, they
will attain objectives as per the level of expectations. This unit is much connected to the
operational division because according to this, human forces to complete their work.
Entire things need to be done with assistance of HR segment (Muhos and et. al., 2017). Operations and Production: Essential purpose of an organisation is to gain maximum
profits and for this, it is must for them to provide best and adequate services to clients.
Transformation of crude material into finished products is called as production procedure.
This aspect is basically concentrate on demands and needs of users; thus, they will
accomplish it in an adequate way. This unit is linked with each and every segment of firm
so that they will complete their entire work within limited period of time. Accounting and Finance: It is considered as a most significant aspect of an enterprise.
Without this unit, it is impossible for an individual to run a business in an adequate way.
They are known as a blood of firm because with aid of this, association will run their
operational activities smoothly as well as successfully. Henceforth, it has been
understood that every aspect of affiliation is much connected with this segment (Drucker,
2017).
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Illustration 1: Structure of organisation
(Source: Structural Behaviour of Enterprise, 2017)
There is description of four essential organisational framework: Function based: This will be consider as a common segment for each organisation but
will distinctive in relation of procedure. Fundamental benefit of utilization of it that,
experts will be distributed as per functions. As a result, they will easily face adverse
circumstances and acquire best outcome. Product based: For this line, it is must for firm to develop a common items for people.
Each item comes into a framework and it must for manager to produce it in an effective
manner (Charter, 2017). With assistance of this, employer will easily diversify their
goods effectively as well as efficiently. Customer based: Fundamental aim of this sort of structure is to accomplish requirements
of people by providing them products and services within limited time span.
 Geographic based: This is related to company who are rendering their goods at global
level. It is must for them to cover some particular geographic region; therefore, clients
will accomplish their needs proficiently. It is basically for those associations who are
operating their business at large scale.
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TASK 3
P4 Positive and negative impact of macro environment upon business organisation
There are many elements which are essential to accomplish entire operational activities in
firm (Kew and Stredwick, 2017). They all will get influenced in a direct or indirect way by the
micro or macro components. In this, micro factors are much associated with intrinsic business
environment, whereas, macro is related with extrinsic business surrounding. They both need to
be taken into under consideration because this will assist to compete with competitors at
competitive market. PESTEL investigation is stated as beneath: Political factors: It is must to implement regulations as well as laws in firm; therefore,
they will get success and growth in an adequate way. It will assist them to conduct their
business in ethical manner. Coca cola is a MNC which is providing soft drinks to people
by maintaining quality. Fundamental positive influence of it is that, this helps to reduce
circumstances of errors and in addition help to neglect illegal exercises. If there is any
alterations in policy of government then, this will provide adverse impact to them (Voigt,
Buliga and Michl, 2017). Economic factors: It is much fundamental for firm to keep up economical elements as
this will aid to improve production as well as profits. It is required to provide maximum
satisfaction to their customers. Along with this, it is must for organisation to achieve
market sustainability as this will aid them in their growth and improvement. But if this
will cater negative influence then, productivity of association will go down. Social factors: This type of component will influence certain business segment such as
retail, cloths, food industry and so on due to alterations in demands as well as taste of
clients. Along with this, it will comprise some other factors which will caused directly,
for example: level of income, age, population, job, attitude and many more (Ji-fan Ren
and et. al., 2017). Positive affect of it that, this is must for manager to know about the
needs and wants of clients on continual basis because it will change as per time. Rather
than this, negative influence which is associated with this, if firm is not able to produce
products as per demand of people then, there productivity and reputation will get
diminished. Legal factors: Many laws or acts are developed by government of United Kingdom. It is
must for each and every kind of business to follow them in an adequate manner. Reason
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behind formulation of regulation is that to restrain organisation from any misconduct or
illegal exercise (Galea, 2017). Association needs to apply Food Safety act into their firm;
therefore, they will provide food to people up to the standard. Coca cola is a MNC and
dealing in soft drinks; thus, it is require for them to maintain standard of their products.
This will help them to take benefits from their rivals at marketplace and in addition they
will maintain their goodwill in an adequate way. The positive affect which is related with
it, that by accomplishing entire legal formalities organisation will complete their business
operations ethically and it will reduce their hazards of illegal exercise. Apart from this,
negative affect is that, there are some flavours which are having sort of drug and
employer add them into their products and it is entirely illegal.
 Environmental factors: It is essential for company to manufacture goods for people in a
adequate manner. They have to take care of health of individual and environment as well.
As a result, it will cater improvement to the procedure of business (Linder and
Williander, 2017).
TASK 4
P5 Studying on internal and external analysis
SWOT investigation of Coca cola: It is must for an organisation to analyse their internal
factors in an adequate manner. This will help them to formulate strategies as well as policies
effectively and efficiently. For above stated aim, manager of firm will conduct SWOT
investigation. With assistance of this, superior will easily determine strengths and weaknesses of
company. Along with this, they will know about the opportunities which are accessible for them
at marketplace as a result, they will take benefits from their competitors in an adequate manner
(Linnenluecke, 2017). Therefore, SWOT analysis of Coca cola is mentioned as beneath:
STRENGTHS:
 They are much leading MNC in the entire world which is providing carbonated soft
drinks to people.
 Marketing strategies as well as brand image of firm is very effective.
 Distribution channel of organisation is impressive; therefore, they will easily accomplish
desire of their customers timely by providing them goods and services within certain
period of time.
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 They are having many sponsors and in addition they invite celerities in their each events.
 Their fundamental strength is their clients. Advertisement and in addition marketing of firm is very impressive which assist to take
benefits from their competitors at marketplace (Luftman, Lyytinen and ben Zvi, 2017).
WEAKNESSES:
 Many of the items of Coca cola is less famous at market which will provide impact to
their profitability.
 Adverse promotion.
 There some goods are getting failed at market which diminished their sales graph.
 There debts are increasing on continuous basis and the main reason behind it, acquisition.
 No diversification of their products.
 Portfolio of their goods are not impressive. Beverages of organisation is not healthy in nature.
OPPORTUNITIES:
 They will promote their other goods and services in a appropriate manner.
 Manager will develop their firm in some other segments, like minute mail spirit.
 Organisation will pack their products more impressively which will help to capture
attention of numerous individuals (Boo, 2017).
 Financial condition of enterprise is much adequate; therefore, they are able to enlarge
their business in more nations. This will help them to build their brand image at global
level. They will launch new items and services for persons which will assist them to increase
their customer base.
THREATS:
 There main rival at marketplace is Pepsi.
 As there are various substitutes of cold drinks which present at market, such as fruit juice.
 Unhealthy goods are removed from the market as it was affecting health of people.
 Sourcing of crude materials (Borman, 2017).
 Numerous associations at marketplace which are challenging Coca cola in a indirect way,
such as Costa coffee, Starbucks, CCD and many more.
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 Growth as well as improvement is very slow which will help them rivals to take
advantages from them (SWOT analysis, 2015).
P6 Ways in which strengths and weaknesses interrelate with macro factors
Elements which are much associated with macro environment can provide impact to
strengths as well as weaknesses; therefore, it is must to examine it in the basis of PESTLE
investigation (Kasemsap, 2017). This can be briefed as beneath: Political factors: Position of an enterprise is much associated with competitive
marketplace; this will influenced because of political elements. To gain benefits from
contenders, it is essential for an affiliation to follow each and every rules which are
formulated by regulatory body. For an example: to increase buying ability of individuals
it is must for government to diminish taxes. Economical factors: Market circumstances will provide influence to the strengths as well
as weaknesses of enterprise. Components of economy will provide impact to the sales
graph of firm which will influence their profits (Yin, 2017). It is must for company to
take the into under consideration; thus, they will accomplish their coveted targets and
goals. Social factors: These elements will affect performance of an organisation either directly
or indirectly. Taste and preferences of clients will change as per the time; therefore, it is
must for employer to analyse it on a continuous basis.
 Technological factors: It is essential for company to use new and latest techniques into
business. Therefore, they will develop goods in an inventive way. This will assist them to
take benefits from their competitors at competitive world. As a result, desired targets will
achieved in a proficient manner (Foss and Saebi, 2017).
RECOMMENDATIONS
At the time of preparation of this assignment, it has been comprehended that it is must for
Coca cola to keep up their effective place at market. Therefore, this will be easy for them to
examine opportunities and they will use them to expand their business at a global level. This will
help them to improve their market share and in addition profits.
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CONCLUSION
From above mentioned assignment it has been concluded that it is must for an
organisation to examine their environment because this will affect business either in a direct or
indirect manner. While manager is preparing strategies and policies for firm then, it is must for
them to analyse surroundings. This will assist to compete their competitors at market place.
Association will improve their goodwill as well as profits. In this assignment, there is description
about SWOT and in addition PESTLE analysis.
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Yin, J., 2017. Institutional drivers for corporate social responsibility in an emerging economy: A
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Online
SWOT analysis. 2015. [Online]. Available through:
<http://www.freeswotanalysis.com/media/681-swot-analysis-of-bbc.html>.
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