Business and Business Environment

This document provides an overview of the purpose of public, private, and voluntary organizations, the size and scope of different organizations, and the relationship between different organizational functions. It also discusses the positive and negative impacts of the environment on business.

Business and business
environment

Table of Contents
Introduction......................................................................................................................................3
LO1.................................................................................................................................................4
P1 Purpose of public, private and voluntary organizations. .......................................................4
P2 Size and scope of different organization................................................................................6
LO2 .................................................................................................................................................8
P3 Relationship between different organizational functions.......................................................8
LO3................................................................................................................................................10
P4 Positive and negative impacts of environment on business..................................................10
LO4................................................................................................................................................12
P5 SWOT analysis.....................................................................................................................12
P6 Interrelation of internal factor with macro factors................................................................13
CONCLUSION..............................................................................................................................15
References .....................................................................................................................................16

Introduction
Business environment is sum or collection of all external and internal factors which affects the
business these factors are such as employees, customers needs and expectations supply and
demand of customers and social trends, market trends, economic changes. Business environment
is the collection of all external and internal factors which are needs of customers, employees,
expectations from the customers, demand and supply, suppliers, clients activities by government,
market trends, social trends, change in economy etc. these factors will affect the work of the company
directly or indirectly. Business environment helps to find opportunities, useful resources, planning in
assists and also improves the whole performance, profit and the growth of the business.
LO1
P1 Purpose of public, private and voluntary organizations.
Each and every business starts with an objective. Whenever taking about an organization
fist think comes in mind a group of individual that required for smooth working of the business.
In this there are three types types of organization private sector organizations are main focuse of
earning profit by engaging large number of customers with their product and develop their
company at a large scale(Evans and et.al., 2017). Private sector companies need to compete with
their competitors for development of their business. Government have no control over private
sector whether they can prepare some rules and regulations for their business. Satisfying their
customers and achieve competitive advantage over market helps them to earn revenue for their
business. Public sector companies are controlled by government all rules and regulations of
company set by government. Public company main emphasize of serving people effectively.
Public sector is not concentrate to earn profit companies got revenue from government and tax
payers. Voluntary companies or individuals have no goal to earn profit rather work for welfare of
society and people. Voluntary sectors get some funds from government, charity, trusts. Each and
every company have an objective and they work to achieve that objective. In this tesco needs to
develop their business by working in different type of sectors.
Private sector
Tesco is a private company and main emphasize on earning a profit for business at large
scale. Aim to satisfy their customers and increase their share in market by developing
competitive advantage for their business. Business needs to develop an effective streategy for
their company. Private companies have a objective to maximize profit for their shareholders.

Private comp-any have an objective to maintain transparency to anly some of top management.
In Tesco all confidential information are given to managers or leaders employees have no idea
private companies need to maintain transparency for their success but at limited extent. Private
companies needs to develop and maintain structure of their organization. Structure of business is
important to earn profit. Companies needs to restrict access to some of the policies and strategies
of business and only some of the management person have access to those strategies. Private
sector companies like tesco wants benefit in tesco from to maximize their share of profit for that
they have to expand their business on the territory where government have low interference on
the working of the company. Private company comes with goal to develop their existence in a
market to engage large number of customers with their products.
Public company
Public company is a large size sturucture controlled by government revenue generated
from taxes from private companies and employees. Public company have less emphasize to earn
profit and comes with a purpose o serve public. Public corporation works for the development of
the territory and increase in standard of living, develop an policies that benefits common people.
Public sectors works to increase the trust on their workings. Companies have their own rules and
regulations. Tesco develop their business to works for welfare of public by providing them goods
and services at low prices, quality products are provided to customers. Help customers to
improve their lives. Provide them facilities like offers and facilities of home delivery. Develop
business at large scale help them achieve competitive advantage. Prepare policies that have no
effect from government rules and regulations.
Voluntary sectors
Voluntary sectors works for development and welfare for the society and development of
people. Voluntary sectors get funds from government and from charity(Prajogo, 2016).
Voluntary sectors may be government or an individual. All the issues in a society voluntary
organization works to solve those problems. Voluntary sectors works to provide shelters to the
individual who effected from climate change, disasters, support to group in a society. Voluntary
organization are different from other organization they have no goal to increase their profit or for
overall success of their organization. Tesco may works as an voluntary organization by providing
charities to different type of people. Develop an effective policy for welfare of an society.
Provide goods and service at low rates to some sectors of society.

P2 Size and scope of different organization
Organizational scope
Organizational scope means planning of resources and working of organization. Scope
shows company their task and how to achieve that task. Scope shows company ability to achieve
objectives and resources to produce the required product. Efforts required from employees of
organization to complete task effectively on time. Scope allows companies to prepare their
budget and cost of product. Have to know time require to complete project. Defining scopte
helps companies to use their time effectively. Organizations needs to develop two types of scope.
Product scope
Companies needs to show scope and satisfaction that their products provide to customers.
Product scope shows the characteristics of a product to satisfy their customers. Product
specification shows how it operates and its functions. Purpose of product to satisfy their
customers. Tesco needs to develop effective specification of their product like size, materials
used to develop product, cost of a product.
Project scope
Project scope shows the plan or strategies require to complete mission of a organization.
Project scope shows how a company achieves their objectives and goals of their business. Project
scope shows required budget for success of organization and raw materials, resources require
developing business at large scale(Quinlan and et.al., 2019). Project shows efforts of employees
require to achieve goals of business.
Size of an organization
Entrepreneurial skills
Success of an organization largely depends on the skills of their entrepreneurs. Skills
shows the ability and talent of entrepreneurs to take decisions. Skills shows judgment abilities
about the bad and good for organization. Ability to use proper financing for business and develop
effective plans to prepare budget for the business. Abilities to analyze the opportunities for
business and skills to hire effective employees those are required to achieve a goals of business.
Skills to become flexible to adapt changes in a business.
Managerial ability

For effective working of business they require strong managerial abilities. Managers
needs the ability to manage the employees of organization. Skills require of employees and use
them effectively for the success of organization. Managers require ability to manage the
resources of organization and prepare plan strategies for development of business.
Availability of finance
Finance in an organization works as a blood in human body. Company needs to know the
funds available in a business and according to that plans prepared for a business. Funds helps
business to work in a long run. Availability of funds helps business to hire skillful employees.
Availability of lab our
Labour is required to develop effective products and services. Skilled labour required for
success of organization(Deasy and et.al., 2016). Labour required for smooth working of
business. Labour is required for development of business at large scale.
Nature of business
Success of business depends on the nature of a business. Business needs to develop plan
that provide return on investment. Business emphasize on development of business at big size.
Extent of the market
Demand for a product helps business to achieve large share in a market. Manufactures
needs a large market to develop their business at a large scale. Commodity needs to have ability
to satisfy the wants of customer. Business development and size depends on the market share of
a business.
Scope of different organization
Local company
Local companies are mainly based on local areas of town they are small sized of
companies. This type of companies are mainly depended on environment of local areas.
National company
The type companies mainly works on the all over the territory or a country. National
companies develop business on their terriotory and try expand their business outside their
territory.
Multinational company
This type of companies works on the different territories. Main works of company mainly
based on their destination country.

Global company
This type companies have their business develop all over the world. Less companies are
develop their business all over the globe.
LO2
P3 Relationship between different organizational functions
Organizational functions means set of activities required for development of business. Set
of activities require to develop a business at large scale. Some functions of organization includes,
operations, marketing, human resource. Organizational functions helps business to develop
smooth working in a business.
Front office functions
Front office or front end organizational function. Front office department is main factors
who directly connects with marketing, sales, customers service. Front office department of
business plays an important role in success of a business(Oriesek and Schwarz, 2016).
Customers are required for development of organization and front office departments responsible
to develop effective relationship to their customers. Provide them services and solve their
problems . Front office required to work effectively to generate revenue for a business. Company
leaders allocate their services. Front office plays an important role in interacting with their
customers and provide the small facilities. Department is responsible to communicate with all
other department of business and prepare salaries for employees of a business. Familiarize
customers with the environment of business.
Back office functions
Back office department are those which are not in front of customers. Customers have no
information about those department. They work behind front office like HR, Finance, IT all this
category works for development of business, or comes in existence when any technical helps or
management of workforce required. Their public attention is less as compare to front office.
Relation between different organizational functions
HR and marketing
HR and marketing both works for development of business. Where HR concentrate ovet
smooth working of business by maintaining all the activities of employees in an organization. An
effective HR requires to develop business and motivate employees. Marketing helps to attract

customers towards product of company. Marketing helps business to analyze their competitors
and tr their customers. Tesco requires both effective marketing as well as HR. Marketing helps
HR department by providing information about product helps managers to make their employees
develop the product that customers demand. HR helps marketing by providing information about
product mission vision of business and facilities provided by product it helps marketers to
provide proper information about the products to their customers.
Marketing and Research & Development
Marketing helps R&D to develop a product that customers requires by analyzing the
needs and wants that satisfy customers. Marketing helps them provide all information related to
market. Helps them to develop product with new technology and new policies for business. R &
D helps business by providing full specification of products that helps marketing to develop
strategies according to product helps them to market and attract customers easily.
Operations
Operation department is responsible to prepare strategy for product design and develop
future goals for a business. Department helps business to use finance effectively and prepare
budget for a business.
Finance and accounting
Finance is required for smooth working of business and all other department of business.
Finance and accounting keeps proper record of money used in a business helps them to develop
business at large scale. Finance requires for development of business at large scale and helps
business to use resources effectively.
Functions linked to organizational objectives
Each and every department of business is responsible for development of organization.
HR department helps to hire skilled employees and provide them opportunities to showcase their
talent for development if business(Hillary, 2017). Marketing department helps in reorganization
of business at large scale. Marketing helps to engage large number customers with their product
and analyze the competitors in a market for company. Research and development department
helps business to develop effective products with help of market research according to need and
requirement of customers. Operations department helps business to design product and produce
product with proper research of market. Operations department prepare strategies for business.
Finance and accounting department of business required to develop effective use of funds and

proper records are maintain for business to reduce wastage of money as well as resources. All the
department needs top work together and communicate with each other for development of
business and to achieve the goals of organization.
LO3
P4 Positive and negative impacts of environment on business.
Environment where business operates plays an important role in success of organization.
Environment have both positive and negative impact on working of a business. When
environment is according to the products and policies of the company and able o attract
customers then it plays an positive impact over customers. When business have no growth over
market and not able to adapt the environment where it operates then it plays an negative impact
over a business.
Political
Whenever Tesco is going to operate their business in a new territory or a country they
need to analyze the working know the government rules and interference on the working of a
business. Taxes on the business of the company, stability of political party and rules and
regulations by government effects the success of a business(Wood and Logsdon, 2017). If
government policies are according to the policies of company then it plays an positive impact in
the growth of a business and if tax rates on products is high or political party interference plays a
negative impact on the business.
Economic environmental
Economy of a country or a territory plays an important role in success of a business.
When Tesco going to operate their business in new environment they need to know the interest
rates prevailing in market for their product employment and unemployment rate on market
employment rate is low then helps Tesco engage large number of required workforce at low
salaries and if employment rate is good then they have to put more efforts to hire employees and
at more salaries. The exchange rate is less than Tesco destination country then it helps them to
earn profit.
Social
social factors helps Tesco to understand needs and wants on their customers and their
culture and values. Tesco is a retail company and have large number of stores all over the world
and it the lifestyle of people on the territory where they are going to operate their business is

good then they able to engage customers with their stores and if the products and policies of
Tesco effects the culture and feeling of people of that area then it effects the growth of company
on the territory. Tesco needs to know the education level and attitudes of people towards their
products.
Technological
Tesco needs to know the availability of technology over the area where they are going to
operate effects the business of their company. Technology needs to analyze because Tesco
engaged in large number of digital platforms they provide different methods of payment and
home delivery facilities to their customers and if technology up gradation and innovation is not
effective in the country then it become tough for Tesco to operate their business in that territory.
Availability of distribution channels for the success of a business helps them to develop their
reach and availability of suppliers.
Legal
Tesco needs tom know the laws and legal rules of the territory where organization is
going to operate. Legal factors may have positive as well as negative impact over the success of
the business. Legal factors are required to develop business at a large scale. Legal factors may be
working of a company in a different environment(Yang and Gabrielsson, 2017). Legal factors
helps business to operate at a large scale. Business needs to operate in different environments.
Legal factors influence the working of an organization. Legal factors evolves the government
interference or interest rates by government.
Environmental
Environmental factors are important for government to develop business at a large scale.
Environment like change in weather or a climate of a place where business is going to operate
needs to be analyzed for smooth working of business. If environment is according to the product
of a company then they are able to earn profit over that environment environment. If
environment is not friendly for goods and services of business then it effects the growth of a
business over that environment.

LO4
P5 SWOT analysis
Swot analysis is the analysis which done to find out the performance as well as position of
Tesco. What are the factors at which the company is string and what are the factors the company
needs improvement. Swot analysis takes into account internal as well as external factors. The
internal factors are within the control of Tesco but the external factors are not under control of
Tesco.
Strength
Strength is a internal factor of Tesco. This is the point at which the company is better than the
competition. Strength of Tesco is its sound IT employees who are expert in programming. The
another strength of company is the quality of infrastructure company provide to its employees.
Tesco allows it’s employees to do experiment using advance technology which other companies
do not allow or possess. This gives encouragement to new innovation and helps the company to
bring a product which is completely new in the market(Calabrese and et.al., 2018). This helps the
company give competitive advantage over others.
Weakness
Weakness is also an internal factorwhich includes the point or the area at which Tesco is weak at.
The area can be corrected with appropriate measures. The weakness of Tesco is poor finance
department who used to invest money without proper analysis of the business and due to this the
company has suffered losses. Another weakness of Tesco is long working hours for employees
and the same can result in switching of jobs of the employees due to which the strength which is
employees of the company can be converted into weakness of the company. This weakness must
be corrected by Tesco by allowing the employees to work at flexible hours in they must be
allowed to work as per their requirement and taste but meeting the deadline.
Opportunity
The opportunity is an external factor in which if Tesco if taken appropriate measure then the
same can result in profitability for the company and if timely actions not taken then the company
can suffer losses. The opportunity for the company is the government of UK is subsidising the
use of green Technology. Tesco should not miss this opportunity because this will save a lot of
cost of Tesco and this will result in increase profitability for the company. This will also give
competitive advantage to the company over others as the company will be able to sell their

product at cheaper rate to the customers. Another opportunity for Tesco is using digital
marketing from the government because the government is encouraging the use Of digital
marketing by decreasing the rate of internet. Using digital marketing the company can save cost
and reach wide range of audience to whom the company can target variety of products at
whatever price they want.
Threat
Threat is an external factor(Saleem, 2015). Threat can be very useful if appropriate actions are
not taken. The biggest threat for Tesco is entrance of Chinese companies as they are providing
cheap rate technology. In order to overcome this problem the company must focus on finding
yourse by which the company can decrease it’s cost and also the price. If the prices are not
decreased then Chinese companies will eat the competition. Another threat for Tesco is social
welfare management, the company is far behind in social activities for which the government
will not give addition benefits such as tax benefits due to which the price of the product will rise
and which will lead to shifting of customer to the competition. Tesco must start campaign in
which social activities are provided to the society. The life of the society will improve and will
also help in having taxes because the government will provide tax benefits.
P6 Interrelation of internal factor with macro factors.
The macro factors are the factors which are taken from the country or bigger point of view.
These factors are bigger than the micro factors. The macro factors takes into account Political
factors, Economic factors, Legal factors, Social factors, Environmental factors , Technological
factors and the Environment factors. All these factors will impact the strength and weakness of
Tesco and the same is discussed in the study.
Political factors
The political factors that will affect the deduction making of Tesco on strength of the company
which is employees of the company by increasing the wave rate in which the company be
required to pay more wages to the employees. This will result in higher burden to the company
as the cost will increase.
The political factor which will impact the decision making related with weakness of Tesco will
be implementation of GST and this will impact the finance department. The finance department
of the company is already weak and due implementing GST the professionals will be confused
regarding investing.

Economic factor
Economic factor which will impact the Tesco strength is change in exchange rate due to which
the price of the technology will increase and this will lead to increase in the price of the
technology which Tesco used to provide to its employees.
Weakness of the company will also be affected by economic factor rise in the price or inflation
will result in high price of the financial software and the same will lead to increase in the budget
for the finance department which doing nothing special to give profit to the company.
Social factor
The social factor which will inspect the decision of the strength of Tesco will be green energy as
the interest of the society towards green energy is increasing(Eling and Schaper, 2017). Which
will affect the company to increase the consumption of green energy towards its software
development. This will ultimately save cost and save time in producing software.
Social factor will also impact the weakness of the company as the society is opposing the long
working hours of the employees. This will promote employees friendly policies for the company.
Due to which the employees will be happy working with Tesco and will be able to give extra
time to the family members and social activities. This will also help the company perform better
as the employees of the company feel better this will lead to increase in the productivity of the
employees and due to which the profitability of Tesco will automatically increase.
Technology factor
Technology factor will impact the strength of the Tesco by advancement in the technology and
due to which Tesco must also used advance Technology. The technology will help in providing
better results and better solutions for the company. Advance Technology if not adopted by Tesco
then this will result in lagging behind the competition. For example if Tesco produces 100 units a
day then with use Of advance technology the company will be able to produce 200 units a day
and the cost of production will also decrease due to this.This will give competitive advantage to
the company and the company will be able to give the product at lower price.
Technology factor will also impact weakness of Tesco by as there are not updated soft wares for
the employees in preparing salary slip. The performance management system is also not updated
due to which the employee's actual performance can not be measured. This is resulting is
disappointing and dissatisfaction among the employees and they are feeling that Inspire of

working very hard they are getting nothing. This is resulting in increasing in switchover rate and
switchover rate is spoiling the image of the company.
Legal factor
Legal factor influencing Tesco is change in laws for technology up gradation in which Tesco is
not required to show the up graded technology in the books of accounts. This will encourage to
upgrade the technology and do not show them in the books which will save taxes of the firm.
Weakness influencing Tesco is the change in laws for the employees in which the employees
will not be allowed to work overtime forcefully(Kolk, 2016)
. The employees if working willing then they must be paid extra pay which just double must be
paid to the employees. This will increase the cost.
Environmental factor
Environmental factors influencing strength of Tesco will be climate change due to Technology
pollution. Steps such as green technology must be taken in order to protect the environment.
Weakness affecting is the pollution by carbon. The weakness can be corrected by using
environmental friendly tools.
CONCLUSION
As per the study it is concluded that it is very important to do Pestle and swot analysis of the
company in order to find out what are the areas at which the company is strong and at what are
the areas the company is weak. There are differs types of organizational structures and also there
needs are different. It is must for the organisation to link it’s objective switch the function of the
company as it will lead to make a focused organization. There are positive as well as negative
impact of macroeconomic factors in which the company must timely adapt the changes because
if not then it can result in losses for the company.

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