Business and Business Environment

This assignment provides an overview of different types and purposes of organisations in public, private and voluntary sectors. It discusses the size and scope of various organisations and explores the different organisational functions. It also analyzes the positive and negative impacts of the macro environment on business operations. The chosen organisations for this assignment are Clarks Ltd (private sector), BBC (public sector) and Save the Children (voluntary sector).

Business and business
environment

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
P1) Explain different types and purposes of organisations; public, private and voluntary
sectors.....................................................................................................................................1
P2) Size and scope of a range of organisation........................................................................3
LO 2.................................................................................................................................................5
P3) Different organisational functional..................................................................................5
LO 3.................................................................................................................................................7
P4) Positive and negative impacts of macro environment.....................................................7
LO 4.................................................................................................................................................8
P5) Analysis of internal and external strengths and weakness...............................................8
P6) Interrelation of strengths and weaknesses with external macro factors.........................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment is a vast concept which includes all the internal and external
factors of an environment which directly or indirectly have impact on operations and functions of
an organisation. Internal factors of business environment include those elements that exist within
or inside the organisation like owners and shareholders, board of directors, employees,
organisational culture, etc (Yamamoto and Zhi, 2019). While in external environment all the
factors which exist outside the firm are included like political, social, technological, etc. For this
assignment Clarks ltd is taken as private firm, BBC is selected as public sector organisation and
Save the children is a voluntary organisation of UK. This assignment includes an overview of
different types of organisation and their size and legal structure. Relation between different
organisational function and organisational structure is also included. At last use of SWOT and
PESTEL analysis is also made to identify the positive and negative impact of environment on
business operations.
LO 1
P1) Explain different types and purposes of organisations; public, private and voluntary sectors
A business is basically an organisation where people work together to make or sell
product or services for earning profit or meeting any other objective (Boon and et. al., 2019). On
the basis of their purpose and origin organisation are classified into various types which are as
follows:
Public sector
Organisations in public sector are owned and control by government authorities and their main
purpose is to provide basic public facility to society which includes army, police, hospital,
education, public transportation etc.(Nikitina and Lapiņa, 2019).
Legal structure- These organisations are directly accountable to government and their rules,
polices and operations are decided and finalised by government or supreme authority of nation.
Public sector is further categorised into three types which are as follows: Central government- These organisations comes under the jurisdiction of central
government and their activities and functions are also funded by central government. State government- These companies are control and managed by government of a
particular state thus, their business operations are mainly limited in that specific state.

 Local government- These firms are mainly run and operated by local authorities or
council which includes Municipal Corporation and other local bodies.
Private sector
Organisations in private sector are owned and managed by private individual or group of
individual. Main purpose of private organisations is to earn profit through satisfying the needs
and demands of customers (Shu, Jain and Liang, 2019).
Legal structure- Different acts and laws are applicable on private sector which includes
provisions of companies act, 2006 and partnership act 1890. On the basis of its legal structure
private sector is classified into three main types which are as follows: Sole proprietorship- Under this type of legal structure an organisation is fully controlled
and managed by a single private individuals having unlimited liability. Sole proprietor
has to get register for self assessment and file a tax return every year as per the legal laws
of UK (Set up as a sole trader, 2019). Partnership- A partnership is an association of two or more individuals where number of
partner ranges from 2 to 20. Role and responsibilities of partners are decided by
partnership deed and have to fulfil the provisions of The partnership act, 1890 (The
Partnership Act 1890 - General Partnerships, 2019). Private limited companies- These organisations are known as joint stock Company where
each shareholder is having limited liability and are bound with the rules and regulation
written in the memorandum and article of association. In UK all the private companies
have to fulfil the provisions of companies act, 2006 (What is the Companies Act 2006?,
2019).
Voluntary sector
The Voluntary Sector is usually comprised of organizations whose purpose is to benefit
and enrich society, often without profit as a motive and with little or no government intervention.
The main purpose of voluntary organisations is to maintain equality and providing basic rights to
all in a society (Khatun and Miah, 2019).
Legal structure- Voluntary sector is divided into following types on the basis of their legal
structure (Legal Structures for Voluntary and Community Groups, 2019).

 Trusts – A charitable trust is mainly a group of people who comes together for the
purpose of charity and well being of society. Members of trust are governed by a trust
deed and have to follow the rules and regulations of trustee act, 2001. Company limited by guarantee- It is one of the most common type of incorporated body
used by groups in voluntary and community sector and its members are bound by its
article and memorandum of association.
Organisation can also be divided into following types on the basis of their size:
 Micro- these are small sized organisation mainly having limited operation and require
limited amount of resources.
 SME- these are small to medium size enterprises which are bigger than micro but much
smaller that global organisation and require an adequate amount of finance and resources.
 Global- these are the big corporate or multinational companies which are having their
business operation in more than one country of the word. Large amount of finance and
resources are required to run and manage a global organisation (Tura, Keränen and
Patala, 2019).
Improvement and development in technology has increased the scope for business
organisation and globalisation is providing a new boost for global and multinational organisation
through providing better connection and interaction with people of different countries.
P2) Size and scope of a range of organisation
Overview of chosen organisations
 Clark Ltd. - it is British based international shoe manufacturer and retailer organisation
which was established in 1825. Its headquarter is in Somerset, England, UK and was
formed by two brothers Cyrus and James Clark. In 2013 it was the 31 largest private
company of the UK.
 BBC- The British broadcasting corporation (BBC) is a British public service broadcaster
having its headquarter in Westminster, London, UK. This organisation operates under its
agreement with secretary of state for digital, culture, media and sport (List of Public
Sector & Government Employers, 2019).
 Save the children- it is a voluntary sector organisation or NGO of UK which was
established in 1919 to improve the lives of children through better education, health care,

and equal opportunities as well as providing emergency aid in natural disasters, war, and
other conflicts (25 Leading Human Rights NGOs in London, 2019).
Size and scope of a range of organisation
Below a description is provided about size, scope and legal structure of chosen
organisations with the help of their mission, vision and objectives.
Clark ltd (private sector)
The vision of Clark ltd is to become a one of the largest shoe manufacture organisation of
UK. The mission of Clark ltd is to provide best quality products and shoes to its customer. Clark
ltd. Is having an objective of maximisation of profit trough attracting more and more customers
for its organisation (Singh, 2019).Clark ltd is offering different types of product to its customers
which include school shoes, Joyance sandal, desert boot, etc. In stakeholders of Clark all its
customers, owners, board of directors, employees, etc. are included. In stakeholders of Clark all
its customers, owners, board of directors, employees, etc. are included. It is large sized
multinational private ltd organisation of UK having more than 15380 employees across the
world.
BBC (public sector)
The vision of BBC is to become biggest broadcasting company of Europe trough
providing best communication and broadcasting services (Zwikael and Smyrk, 2019). BBC is
having a mission to enrich the life of people with their program and to provide best services t
will inform and educate people. The main Objective of BBC is to show the most creative, highest
quality and distinctive output and services to support the learning and knowledge of people.
Various services are provided by BBC which includes broadcasting through television, radio,
news, internet, music shows, etc. Stakeholders of BBC include the government authorities from
which it get finance and all the clients and customers who are having any kind of interest in
business operations of BBC (Sousa and Rocha, 2019). BBC is having more than 22401
employees which show it is quite large public sector organisation providing its facility in many
parts of world.
Save the children (voluntary sector)
Save the children is having a vision to a build a world in which every child will have the
equal right of survival, protection, development and participation. Mission of save the children is
to achieve the immediate and lasting changes in the lives of children for their betterment. Save

the children is having an objective of reducing death of children and providing better educational
and survival opportunity to them. Save the children is providing social services and making
efforts to improve the lives of children in many parts of world.It’s most important stakeholders
are its members who are making charity and donation for this organisation. The lakh of children
who are saved by this organisation are also its stakeholders. Save the children is having a global
network which is operating in more than 120 countries of world.
LO 2
P3) Different organisational functional
Clark ltd is a famous shoe manufacture and retailer of UK. Being a manufacturer most
suitable organisational structure for this organisation is product based organisational structure as
it groped different activities or functions according to the product and provides proper
coordination between all the functions. The main business functions of Clark ltd are:
Marketing- this department or function is responsible for maintaining effective
communication between Clark and its customers. Marketing function is essential to promotion
and advertising of product of Clark to increase its sales and profitability (Ali, Islam and Rahman,
2019).
Production- this function of Clark is having responsibility of manufacturing and
delivering best quality product for staying needs and wants of customers.
Finance- Preparation of timely budgets and financial reports is the responsibility of
finance department. In Clark ltd finance department is very effective and properly performing its
function through reducing amount of waste of money in wasteful activities trough keeping a
close control and check on all expenses.
R&D- the main function of research and development (R&D) department is to perform
timely research for better innovation and creativity and to ensure effective use of latest
technology for betterment and success of Clark ltd (Ruohomaa and Salminen, 2019).
Interrelation of functions in Clark ltd.
Production and R&D- A link up between production and R&D function provide better
process and effective technology for better manufacturing products or shoes of Clark. It will
provide more competitive advantage as customers are attracted towards better quality product,
thus, increase the sales and productivity of Clark ltd. Better use of R&D function also lead to

better cost control as provide best production process to reduce the amount of wastage of
resources in manufacturing process. This interrelation facilitate achievement of objectives of
Clark ltd as it provide best way od production which will reduce the cost of production and make
it more cost effective which increases profit margin thus, yield higher amount of profits to meet
its business objectives.
Finance and marketing- an effective connection between marketing and finance
function ensures effectiveness of marketing tool as proper funds are allocated or provided for
effective execution and implementation of marketing strategy. It creates better awareness in
market about the product of Clark ltd thus, attract more customers and increase sales quantum of
Clark ltd (Xiong, Ye, and Wang, 2019). This interrelation provide better control on expenses and
cost thus, helpful for Clark Ltd to meet its objective of higher profits.
From above discussion it can be said that interrelation between business function
is useful for Clark as it provides better competitive strength and also increase productivity and
profitability through increasing number of potential customers. This interrelation provides better
coordination and thus, leads to timely achievement of targets and goals but it has also increased
the chances of conflicts between different departments of Clark which can negatively affect the
productivity and performance of employees.
Product based organisational structure of Clark ltd.

(Figure 1: Product based organisational structure of Clark Ltd, 2019)
(Source: Product based organisational structure of Clark ltd.)
LO 3
P4) Positive and negative impacts of macro environment
To analysis the positive and negative impact of macro environment use of PESTEL
analysis is made which is described below:
PESTEL analysis
Positive and negative impacts of elements of macro environment on Clark ltd are
described below:
Political- In UK political environment is quite stable which provides many opportunities
of growth and expansion to Clark ltd. But the recent Brexit issue is creating some negative
impact on internal market of Clark mainly in areas of Europe (Baporikar, 2019). Brexit has
reduced amount of investment and creates a state of rescission in UK and also created problem of
workforce migration which is creating skilled workforce shortage in Clark ltd.
Economical- Efficiency in financial market and stable economic conditions of UK are
useful for Clark as it ensures adequate amount of demand for consumer products which reduces
the risk of failure. Moderate interest and inflation rate are also creating a positive economic
environment for Clark. The current employment rate of UK is 3.9% which has increased some

issues for Clark ltd as they are not getting cheap labour in UK which has increased its cost of
production.
Society- Beliefs and attitudes of society have a significant effect on functions and
decision making on an organisation. The needs and taste of society of UK is highly dynamic and
keeps on changing which provides opportunity to Clark to have better product development
process and also increased the scope for innovation. But this dynamic nature of society has also
created a pressure on Clark ltd to have continuous innovation and creativity in its product to
remain successful in the business market. The Christians society is mainly resides in UK which
is highly skilled thus, increased scope for Clark as it can get skilled employees from society.
Technological- UK is fast growing nation where continuous technological development
is going on. Improvement in technology is useful for Clark as it provides better and more
efficient ways of production which will increase its productivity and profitability. But rapid
change and improvement in technology has also increased the cost of Clark as huge amount of
finance is required for advancement of technology (Jabłoński, 2019). Many new efficient
processes are available in market which can be utilised by Clark ltd.
Environmental- Different norms and standards for protection of environment have
significant impact on functions and profitability of an organisation. Government authority of UK
is providing healthy tax breaks to companies that are making use of renewable sources and
enhance sustainable development. Thus, it is providing an opportunity for Clark ltd to make use
of renewable resources and it should also make efforts for better waste management to reduce
the amount of pollution so that it can also avail various tax benefits and it will also improve its
image which will attract more customers for its product.
Legal- This element of macro environment includes all legal laws and regulation made
by government authorities for protection and welfare of employees. Strict labour laws and
employee act of UK are creating a pressure on Clark to provide higher amount of salary and
wages to its employees which is increasing its cost of production (Wirtz, 2019).
Thus, it can be said that various elements of macro environment of Clark are providing
many opportunity in form of better chances for technological advancement and innovation but at
the same time legal strictness and Brexit issue is creating some adverse situation.

LO 4
P5) Analysis of internal and external strengths and weakness
For analysis of internal and external strengths and weakness of an organisation use of
SWOT analysis is made.
SWOT analysis of Clark ltd.
Strengths Weakness
 Clark shoes provide largest selection
and product range of shoes in UK.
 Continuous investment in innovation
and product marketing (Yamamoto and
Zhi, 2019).Efficient supply chain and
strong team management.
 Strong advertising and marketing of
products.
 Effective go to market strategies for its
product.
 Provides higher level of customers
satisfaction.
 Strong brand portfolio.
 Intense competition has limited market
share and growth.
 Low investment in research and
development which creates lack in
performance as compared to other
competitors.
Opportunities Threat
 Having an opportunity to investment in
sustainability and make use of
renewable resources.
 Better opportunity to expand its
operation across different region of
world with better promotional activity.
 Opening up of new business market in
other fast growing region of world like
in some location of Asia especially in
China.
 Strict labour laws and employment act
in UK.
 Increasing recession in many countries
of Europe is effecting its international
growth (Boon and et. al., 2019).
 Not able to tackle challenges provide by
new entrants.

From the SWOT analysis of Clark ltd it can be evaluated that its management should take
effective decision for better innovation and creativity in its product. Clark should also take active
and better decisions to comply with provisions of employee act of UK.
SWOT analysis of BBC
Strengths Weakness
 Old reputation and faith of people is
helpful in maintaining its level and
flourishing its operations.
 New and updated content is the strength
of BBC.
 Use of advanced marketing strategies.
 Strong brand image and technological
advancement.
 Spread its wings not only in radio
sector but gaining reputation as TV
broadcaster and also coming in virtual
world.
 BBC is having a high operating cost as
compared to its competitors which
reduce its profit margin (Nikitina and
Lapiņa, 2019).
 increasing controversies regarding
content of shows.
Opportunities Threat
 Opportunity to steep into the
entertainment zone and conduction
program on fashion, entertainment, etc.
 Opportunity for having joint
partnership with other satellite channels
foe more efficient operation (Shu, Jain
and Liang, 2019).
 Opportunity of becoming unbiased
regarding the content of shows.
 Facing strong competition from news
channels like CNN.
 Launching of domestic channels is
creating threat for this organization.
From SWOT analysis of BBC it can be said that proper decisions and strategies should be
made to reduce the operating cost. Effective steps and decisions should be taken for better
growth through having partnership and agreement with other satellite channels.

P6) Interrelation of strengths and weaknesses with external macro factors
A proper interrelation between external macro factors and internal strengths and
weakness of an organisation ensures better results trough timely achievement of goals and
targets. If strategies and decisions are properly taken after analysis of external environment it
will provide better opportunity and also reduce the risk of future liability. PESTEL analysis
provide detail information about important elements or factors of external or macro environment
which include deep discussions about political, social, environmental, economical, technological
and legal environment (Khatun and Miah, 2019). SWOT analysis focuses on evaluation of
internal strengths and weaknesses and possible opportunity and threat. An organisation must take
decision after proper analysis and after making an interrelation between existing opportunity and
how this opportunity can be availed with proper use of strength. This interrelation of strengths
and weaknesses with external macro environment also reduces the risk of threat through making
an organisation aware and alert about possible consequences.
The macro environment of Clark is providing many opportunities in form of stable
political and economical environment. Technological environment is providing a better chance
of advancement in production process to reduce cost of operation and also facilitates
manufacturing of better quality products which is helpful in gaining more competitive advantage
and also attract a large number of customers for its product. SWOT analysis of Clark ltd has
shown that it is having a vast selection and range of product and also having capability to spend
on innovation and advancement of technology. An opportunity is also shown which includes
effective use of renewable resources for enhancing sustainable development. A proper
interrelation between current opportunity of technological advancement in macro environment
and strength of Clark of having good amount of investment in innovation and creativity will
provide a more efficient and effective use of technology for increasing productivity and
profitability of organisation (Tura, Keränen and Patala, 2019). Legal environment of Clark has
put a pressure on organisation for providing better remuneration and incentives thus, it become
necessary for Clark to take all possible corrective decisions to meet the provisions of legal laws
and act.
The internal strength of Clark ltd of having continuous improvements and innovation in
its product are creating an opportunity for its as in its macro environment scope for
terotechnological improvements is increasing. Clark ltd should enhance its investment in its

research and development so that opportunity in its macro business environment can be availed.
One of the internal weakness is of Clark is related with following the provision of laws and
regulations made by government which is increasing danger for it as its macro environment
which includes strict laws and regulations thus, to reduce the chances of any future claim or
litigation Clark should properly follow all legal provisions applied on it.
CONCLUSION
From this assignment it can be summarised that various types of organisations are
there in a business environment which includes public sector, private sector and voluntary sector.
These sectors are further classified into many types of organisation on the basis of their legal
structure like private sector includes sole proprietorship, partnership and limited companies. The
main mission of a voluntary sector is to provide social services to create equality. Marketing,
production, finance, etc are the main function of any organisation and an interrelation between
these function facilitates timely achievement of goals through properly coordinating efforts of an
organisation. Use of PESTEL and SWOT analysis is made to evaluate the macro environment
and internal strength and weaknesses of an organisation.

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