Business Environment: Types of Organisations and their Functions

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
P1............................................................................................................................................3
P2:...........................................................................................................................................5
LO2..................................................................................................................................................7
P3............................................................................................................................................7
LO3..................................................................................................................................................8
P4:...........................................................................................................................................8
LO4..................................................................................................................................................9
P5:...........................................................................................................................................9
P6:.........................................................................................................................................12
CONCLUSION..............................................................................................................................13

INTRODUCTION
Business Environment is considered as a mixture of micro as well as macro variables that
effect over operating situation of a firm. This is also known as combination of elements that may
or may not be under the control of an enterprise (Quinlan and et. al., 2019). It includes all those
factors that affect growth and productivity of an organisation like suppliers, consumers,
competitors and so on. Present report give review about Marks & Spencer that is a British based
global retail organisation that deals with clothing, food and home appliances. Further, project
also cover variety of enterprises that operate in business environment and their purposes and
scope and size of these enterprises. Further, explains the relationship between different functions
of organisations and their connection with its objectives and structure. Further it consists,
negative and positive influence of external elements on company’s activities by using PESTLE
analysis. It also summarised analysis of a sector with the help of SWOT analysis and Porter's
five forces model. Interrelation of strengths and weaknesses of an enterprise with external
elements of macro environment are also included in present assignment.
LO1
P1
Organisation can be defined as a sum of organised individuals that has a mutual purposes
and responsibilities for achieving overall objectives of an enterprise. Mainly there are three type
of enterprises which has varied purposes and legal structure which are private, public and
voluntary organisation.
Private Organisation- It can be defined as any individual, partnership, association, corporation
and agency that is not a public enterprise and operates its activities in order to earn profit. The
example of Private Organisation is Mark & Spencer that is a United Kingdom based
multinational entity (About Us, 2019).
Purpose of Mark & Spencer- The basic purpose of Mark & Spencer is to satisfy
customers by providing them best quality products in order to earn profits.
Legal Structure- Some specific legal structure that is followed by different companies
for carrying on its business activities. This organisation follows The UK corporate Governance
Code, 2018 which states that company must complied with all provisions of this code and be
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committed towards high standard of corporate governance. The legal structure of private firm
can be understood by following given points:
Sole Proprietorship- Under this legal structure, a person operates a whole enterprise and
is the single owner of that organisation. The risk is high in such enterprises and owner has
limited freedom over business decisions (Crane and et. al., 2019).
Partnership- It can be determined as an agreement or contract that takes place between
two or more than two individuals that work together for achieving organisational objectives.
Limited Liability Companies- Such firms has various owners and revenue generated from
these organisations are shared among all of them.
Public Organisation- Public sectors are operated and owned by government for the purpose of
providing various services to the individuals living in society. The basic goal of public firm is
not to earn profit instead it works for fulfilling needs of public. Here, an example that can be
taken for public entity is BBC (British Broadcasting Channel).
Purpose of BBC- The basic goal of BBC is to provide important information and news
prevailing all over the world to people.
Legal Structure- Public organisation follows all rules and regulations that are imposed
by government upon them. The royal charter is the constitutional basis for this organisation
which determines its objects, public purposes and mission. It also determines the regulatory
arrangement and governance of company which consists composition & role of Board of BBC.
Legal structure of these firms is here under:
State Government- Under this legal structure, operations of a company is operated and
owned by state government of that state under which that organisation is operating its activities.
Central Government- These enterprises are operated and incorporated by Central
government of United Kingdom.
Local Government- These companies are incorporated under nation or by government
structure of municipality.
Voluntary Organisation- These enterprises are also known as non-profit organisation that carry
out its operations for development of society not for earning profits. An example of voluntary
organisation is the Charity Commission of England and Whales (Gaganis, Pasiouras and
Voulgari, 2019).
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