Business Environment and Stakeholder Mapping

The provided document is an assignment that delves into the business environment, stakeholder mapping, and organizational structure. The first section focuses on the business environment, discussing its importance, features, and Porter's model. The next part covers stakeholder mapping, using a diagram to illustrate the process. Following this, the document presents an example of a functional organizational structure. References to academic sources and online resources are also included for further study.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Explain different types and purposes of organisations; public, private and voluntary sectors
and legal structures.................................................................................................................1
P2 Explain the size and scope of a range of different types of organisations........................3
TASK 2............................................................................................................................................6
P3 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure..................................................................................6
TASK 3............................................................................................................................................8
P4 Identify positive and negative impacts the macro environment has upon business
operations...............................................................................................................................8
TASK 4............................................................................................................................................9
P5: Conduct internal and external analysis of organisation to identify strengths and
weaknesses.............................................................................................................................9
P6 Explain how strengths and weaknesses interrelate with external macro factors.............10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business Environment refers to the sum total of all institutions, individuals and other
variables that are uncontrollable of firm but business still rely on them as it influences its overall
sustainability and performance (Business Environment, 2017). It is the surroundings in which
company perform all its operations and functions. In the present assignment, chosen organisation
is Sainsbury's which is a United Kingdom based supermarket chain headquartered in Holborn,
London. It offers grocery products to its customers. This report covers size and scope of
organisation as well as interrelationship of different functions of firm and their link with
structure. Apart from this, positive and negative impact of macro environment on operations of
company is defined. At last, internal strengths and weaknesses are identified and their
interrelation with macro factors are discussed in this project.
TASK 1
P1 Explain different types and purposes of organisations; public, private and voluntary sectors
and legal structures
In existing business market, distinct types of organisations are present, i.e., public,
private, voluntary and each one has its own purpose and legal structure. Every business firm
requires to follow that structure and need to work accordingly. Some organisations run with the
aim of society welfare while some are for earning high profits. Different types of firms and their
structure and purpose are defined below:
Private sector organisation:
This sector of country's economy is managed and run by private individuals or firms.
These are not the part of government and carry out their operations with the main objectives of
earning high profits (Avramenko, 2012). This sector highly contributes in economic growth of
country and offers innovative goods to customers for satisfying their needs.
Company Overview:
Sainsbury's is one of the private sector organisation that offers grocery products to
customers. It is a super market chain which is headquartered in Holborn, London, United
Kingdom.
Purpose:
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Main purpose of the organisation is to offer high quality products to customers and earn
higher profits in competitive market (Bovee, Thill, and Raina, 2016).
Types of legal structure:
Partnership: It is the easiest form of business that can give additional managerial and
financial resources to company. Partnership firms are formed by mutual commitment of two or
more persons. A partnership deed is signed by all the partners that contains all the terms and
conditions of operating business collectively.
Sole proprietorship: This type of business is operated and run by single individual only.
The owner of company is solely responsible for all the profits and losses incur in business. Less
investment is required to establish the business.
Limited company: It involves two types of companies, i.e., limited by share and limited
by guarantee (Cavalcante, Kesting and Ulhøi, 2011).
Public sector organisation:
Public organisations are entirely run and managed by government of respective country.
Their purpose is not only to earn profit, but to work for development and welfare of society.
Public organisations raise money from public in the form of taxes and penalties.
Company Overview:
National Health Services is one of the public sector organisation which provides health
care services to domestic people of country as well as visitors. The institution is funded by
general taxation system and run by health department.
Purpose:
The purpose of NHS is to improve wellbeing of patient and enhance living standard of
society by care quality, professionalism and innovation.
Types of legal structure:
Central government: The primary responsibility of central government includes handling
affairs of entire nation. Tax collection and denomination printing are considered as the main
activities of central government (Hair, 2015).
State government: All the issues of a specific state are managed and controlled by state
legal authority. For instance: different policies are framed by state government to promote higher
education among people.
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Local government: All the affairs of local level, i.e., a specific area, city or town is
handled by state government. Local government perform their duties and responsibilities with
the assistance of central and state government.
Voluntary sector organisation:
Voluntary organisations are the firms whose purpose is enrich and benefit society. These
are non-profit firms in which interference of government is very little or no intervention. These
organisations run only for society welfare (Hamilton and Webster, 2015).
Organisation overview:
Maytree is a charitable organisation that fall under voluntary sector. The firm runs for the
purpose of assisting people who suffer from suicidal crisis. Organisation works to restore hope
among people so that they enable to re-engage again with their life.
Purpose:
Main purpose of Maytree is to administer right guidance or direction to individuals who
are in suicidal crisis and lose hope of living life.
Types of legal structure:
Trust: This legal structure of voluntary organisation is inexpensive and simple to form.
No statutory framework is available in trust and is governed by trust deed. It cannot enter into
agreements as it is not a legal entity.
Unincorporated association: This association is an inexpensive and straightforward
structure for charity that will be governed through constitution. Unincorporated association is not
a legal entity of its own right and carry no limitation of liability.
Company limited by guarantee (“CLG”): It is the most common structure of voluntary
organisation which is registered at company's house. This is a limited liability firm that is
regulated by articles of association.
Charitable incorporated organisation (“CIO”): This legal form of structure is the new
one and designed particularly for charities. It is solely incorporated and governed by charity
commission that eliminates the requirement of duplicate filings (Karagiorgos, Drogalas and
Giovanis, 2011).
P2 Explain the size and scope of a range of different types of organisations
Every organisation is distinct in its size and scope which varies as per the nature and
activities of business. Size and scope of different organisation are defined below:
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Public sector organisation: NHS
Vision: “To deliver high quality care services to local citizens of country and provide
them healthy lives.”
Mission: “To constantly offer high quality care services to each individual so that they
live healthy and happy life.”
Size: Operations of NHS are run in various countries of United Kingdom. For offering
quality care services to people, approximately 1.4 million of employees are working with
organisation. Ireland, Scotland, England, Whales are the countries where firm offer its services
(Kolk, 2016).
Scope: Different types of healthcare services are offer by NHS to local citizens of nation
at zero cost. Autism assessment, physiotherapy, general medicine, cardiac rehabilitation etc. are
the services that are provided by NHS to public.
Private sector organisation: Sainsbury's
Vision: “To become one of the leading grocery retailer of world and yield high profits
ratio in market.”
Mission: “To satisfy customers by providing them high quality grocery products at
economic costs and gain their loyalty.”
Size: Currently, the Sainsbury's is preforming its operations in over 40 nations with
approximately 1411 outlets (Number of Sainsbury's Stores, 2017). Around 1,81,900 employees
are working with organisation in order to provide goods and services to customers in an effective
way.
Scope: The products of Sainsbury's includes fish, meat, frozen food, petrol, grocery
products etc. Many of the company's stores are selling only grocery products which demonstrates
about high demands of goods (Nishitani and et. al., 2012).
Voluntary sector organisation: Maytree
Vision: “To provide hope to those people who are suffering from suicidal crisis and
encourage them to re-engage in their life.”
Mission: “To promote development and welfare of society and secure their social and
economic rights.”
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Size: Matyree is an autonomous organisation which works with the aim of society
welfare by providing guidance and hope to individual who is in suicidal crisis. Firm facilitates its
services 24*7 to suffers of suicide.
Scope: The main objective of Maytree is to provide direction or guidance to people who
are suffering from suicidal crisis and restore hope among them so that they enable to re-engage
in their life again and live it happily.
Stakeholder Analysis:
This is a framework that is utilized by organisations for assessing their important
stakeholders who are associated with business (Stakeholder Mapping, 2018). With the help of
stakeholder analysis, Sainsbury's can determine needs of its stakeholders appropriate and their
contribution in business growth. It involves stakeholders with:
 High power and high interest.
 Low power and high interest.
 Low power and low interest.
 High power and low interest.
(Source: Stakeholder Mapping, 2018)
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Illustration 1: Stakeholder Mapping

TASK 2
P3 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure
In an organisation, different departments are working collectively for attaining a common
objective. Their main purpose is to satisfy needs of customers and accomplishing pre-set
objectives of company in an effective manner (Osterwalder and Pigneur, 2010). For each
department of organisation, it is very essential to work with proper coordination so that all the
activities and operations can be run smoothly. Different functions of a firm are interlinked with
each other and are highly linked with its objectives and structure. Various functions of
organisation are defined below:
Human resource department: It is one of the crucial departments of company as it is
responsible for hiring and selecting skilled candidates who are able to attain its objectives.
Various other roles are also performed by human resource department of Sainsbury's such as
employee compensation, providing them training and development, maintain healthy work place
etc. which helps in increasing motivation level of manpower which results in attainment of
organisational objectives. In Sainsbury's, workforce is considered as the most profitable resource
of a company and their contribution is very high in its growth and success. Human resource
manager of firm design appropriate training programme to its manpower which helps them in
increasing their skills. This assists in increasing productivity of workers which results in
attainment of objectives of Sainsbury's. Human resource department is highly interlinked with
other departments as manpower for all the functional areas are hire by it. Without having skilled
and competent workforce, no department can run its operations smoothly. Marketing department
contributes in communicating about the vacant position of organisation so that skilled candidates
can be hire within company.
Marketing department: Main role of this department is to promote products and services
of company effectively in market. By the assistance of marketing department, Sainsbury's
enables to communicate value and benefits of its goods to customers in an effective manner
which helps in attracting them more towards firm (Osterwalder and Pigneur, 2010). High amount
of funds are required to market any product. So, finance department plays crucial role in
providing enough funds to marketing division so that products can be promoted effectively and
goals and objectives of Sainsbury's can be successfully attained. The contribution of human
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resource to marketing department is to hire skilled individuals for it, so that they can effectively
communicate about goods and services in market and attain predetermined objectives of
company.
Finance department: It is the life blood of an organisation as without availability of
adequate amount of funds, no operations can be run effectively. So, a crucial role is played by
finance department in attaining objectives of Sainsbury's. The main responsibility of finance
manager is to allocate proper budgets to each department of company, so that their operations
can be run smoothly and goals and objectives of firm can be achieved. Without having adequate
funds, no department is able to run its operations smoothly. Thus, finance department plays
crucial role in running day to day operations of each department and attaining objectives of firm.
Customer service department: This department enables firm to offer effective services to
customers and maintaining good relationship with them (Pikka, Iskanius and Page, 2011). In
Sainsbury's, customer service department helps company to offer high quality services to those
customers who come to their store for buying grocery items. This department helps company in
catering needs of customers in more better way which ultimately results in attaining set
objectives of firm. In maintaining good relations with customers, each department plays crucial
role and it interrelated with each other. Marketing department helps in communicating about
values and benefits of products of company so that large number of customers can be attracted
towards it. Finance department provides funds to customer service department so that they
enable to effectively fulfil needs of customers. Human resource department hire employees with
good interpersonal skills so that they can be able to maintain good relationship with customers.
In this way all the departments are interlinked with each other and contributes in attaining
objectives of company.
Above mentioned are the different functional departments of Sainsbury's which are
interrelated with each other and work collectively to attain common objectives. The success of
entire organisation is highly rely on these functional departments.
Organisational structure of Sainsbury's:
Functional structure:
It is commonly known as bureaucratic structure which divides firm on the basis of
speciality. This is a traditional business structure with marketing, sales and customer service
department. In functional structure, roles and responsibilities of each department is clearly
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defined which eliminates the chances of arising confusions. Sainsbury's have functional
organisational structure in which people with same skills and knowledge are grouped together
which helps company in performing its functions more effectively (Pulver, 2012).
Illustration 2: Functional Organisational Structure
(Source: Functional Organisational Structure, 2008)
TASK 3
P4 Identify positive and negative impacts the macro environment has upon business operations
Macro environment is defined as the general surroundings that impacts on operations and
working of business environment. It involves factors like political, economic, social and
technological variables business functioning (Reed and et.al., 2013). So, manager of Sainsbury's
requires to consider all these factors in order to run their operations smoothly and effectively.
They impact negatively or positively upon business which is defined below:
Political:
It involves the factors like tax policies, tariffs, fiscal policies etc. that impacts on
operations of Sainsbury's.
Positive: The tax policies made by government of United Kingdom is flexible, simple
and more transparent which impacts positively on company's practices.
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Negative: Political pressure for providing higher wages to employees impacts on
business in negative way.
Economic:
Economic factors include interest rate, inflation rate, economic growth patterns, exchange
rates etc. are the factors that includes in this variable.
Positive: Growth of country and economic stability impacts operations of firm in positive
manner.
Negative: Brexit impacts negatively on profits ratios of company as they tend to lower
down prices of their products due to inflation in UK market (Reinhardt and Stavins, 2010).
Social:
It is related with beliefs and attitudes of society, age distribution, population growth etc.
which directly affects that way in which marketers of Sainsbury's understand customers.
Positive: Sainsbury's provides all products under one roof to customers which impacts
positively on operations of firm. This helps company in attracting more number of customers.
Negative: Demands of customers for products are changing frequently which impacts
negatively on sales of Sainsbury's.
Technological:
It involves emergence of new technology and technological advancements which needs
to be consider by manager of Sainsbury's in order to grow and sustain in competitive market.
Positive: Increasing online food delivery of Sainsbury's impacts on operations of
company in positive way as it results in maximizing its sales.
Negative: Use of obsolete technology in processes and operations of business impacts on
it in negative manner (Shigang, 2010).
TASK 4
P5: Conduct internal and external analysis of organisation to identify strengths and weaknesses
SWOT Analysis is a tool that is utilized by organisations for determining its internal and
external strengths, weaknesses, opportunities and threats. SWOT analysis of Sainsbury's is
defined below:
Strengths Weaknesses
 Firm is one of the well-known largest  Rising prices of food all over the world
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supermarket chain.
 Company has highly experienced
leadership team.
 Excellent advertising and branding
strategies utilized by company.
 Diversified investments enables firm to
keep its strong foot in growing retail
market of UK.
have influence on its selling.
 Stiff competition in each sector of retail
industry leads to low profit margins.
 Less presence in global markets limits
scope of business growth (Trevino and
Nelson, 2016).
Opportunities Threats
 Business expansion in rural areas and
countries with growing economies.
 Implementation of self-checkout
machine within stores can assists in
opening it 24 hours that provides
opportunity of increasing sales (Wirtz,
Schilke and Ullrich, 2010).
 Increasing globalization pose a
challenge in front of company.
 Availability of substitute products
increases the risk of brand switching by
customers.
 Availability of various competitors like
Aldi, Lidl etc. in market.
P6 Explain how strengths and weaknesses interrelate with external macro factors
Macro factor are interrelated with strengths and weaknesses of company. Therefore, it is
very essential for managers of Sainsbury's to consider macro environment factors with strengths
and weaknesses of company. Interrelationship between these are defined below:
Political: Political stability of United Kingdom provides an strength to company in
running its business operations smoothly and effectively in market. Formulation of policies and
strategies by considering political variables provides a strength to firm in terms of maintaining its
long term sustainability in market (Van Vuuren, Roberts-Lombard and Van Tonder, 2012).
Economical: High unemployment rate, inflation rate etc. are the elements that affects
Sainsbury's in significant manner. Increase in prices of food products pose a weakness for
company as it results in decline in its sales. It also leads to decline in production of food
products. Expansion of business in other countries or in rural areas provides an opportunity to
Sainsbury's in terms of increasing its operations and reach to large number of customers.
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Social: Providing goods as per the needs of customers at economic prices helps company
in satisfying large number of customers. This is a strength for company as it assists in attracting
more number of customers towards its products. Availability of similar products in market
allows customers to switch to another brand which creates a threat for company of losing its
customers (Werther Jr and Chandler, 2010).
Technology: Use of old and obsolete technology in business processes and operations
can be a weakness for company as it restricts firm to offer high quality of products and services
to its customers who visit their store. Use of self-checkout machine in its business process
provides an opportunity to Sainsbury's in terms of providing 24 hours services to customers and
increasing sales.
CONCLUSION
As per the above mentioned report, it has been concluded that business environment
consists of factors that may impact negatively or positively on activities and operations of
business. By considering these factors, firm enables to run its operations smoothly in competitive
market. Three types of organisations are there including public, private and voluntary sector
which have their own purpose, scope, size and structure. Private firms are established with the
aim of earning high profits while public companies run its operations for both earning profits as
well as society welfare. Voluntary organisations are non-profit firm which run only for single
purpose, i.e., welfare and development of society. Different functions of organisation are
interlinked with each other and work collectively to attain business objectives. SWOT analysis
helps company in determining its strengths, weaknesses, opportunities and threats.
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Business Environment. 2017[Online]. Available
through:<https://www.slideshare.net/NikhilSoares/business-environment-
featuresmeaningimportanceobjectives-porters-model> .
Stakeholder Mapping, 2018. [Online]. Available through:
<https://expertprogrammanagement.com/2009/07/stakeholder-mapping-and-
communication/>.
Number of Sainsbury's Stores, 2017. [Online]. Available through:
<https://www.statista.com/statistics/386475/sainsburys-store-numbers-by-convenience-
and-supermarket-united-kingdom-uk/>
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