Business Environment and Organisational Function

The provided assignment focuses on enhancing students' understanding of the business environment's impact on organisational function. It explores various factors such as marketing, finance, operational, and human resources contributing to better success at the market place. References from books, journals, and online sources are used to support the discussion.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types of organisations.............................................................................................1
P2 Size and scope of the organisations.......................................................................................4
P3 Organisation structures and functions....................................................................................5
TASK 2............................................................................................................................................7
P4 Identify the positive and negative impacts the macro environment has upon the UK retail
sector...........................................................................................................................................7
P5 Internal and external analysis of a UK Supermarket to identify its strengths and
weaknesses..................................................................................................................................9
P6 Strengths and weaknesses interrelate with external macro factors......................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment consider a combination of internal and external factors which
directly influence entire activities of the business organization in positive and negative impact.
Thus, it is important for manager to effectively examine as well as evaluate the impact of
environment factors. It includes various factors such as suppliers, customers, political, legal,
social, technological and many more (Business Environment, 2018). For managing all these,
manager also formulate as well as develop appropriate strategies and policies which may leads in
attaining set goals and objectives in effective way. Present report is based on Marks and Spencer,
is multinational company which serve diversified products to their customers. This report,
discussed about various type, purpose and scope of organization with its structure. Along with
this, PESTLE analysis is also mentioned in this project to determine the positive and negative
impact on business organization. In addition of this interrelation of strength and weakness with
external macro factors are also discussed in this project.
TASK 1
P1 Different types of organisations
As per business environment, number of companies are operate their business with the
purpose of attaining better success. In this context, every companies have their specific purpose
and type in which they perform their activities. Thus, it is important for manager to effective
understand all type of company to attain competitive advantage in market place. With the help of
this firm improve their performance level at at the same time also attain set goals and objectives.
Along with this, various type of business enterprise also work in market to attain favourable
goals and objectives in appropriate time frame. Thus, it is important for organisation and its
manager to effectively understand the purpose to perform their activities accordingly. With the
help of this company easily achieve better success in market place. In this context there are three
type of companies such as Marks and Spencer, NHS, and Oxfam. All these are work in different
sectors with their specific purpose and supply of goods and services (Avramenko, 2012). In
addition of this, the difference between profit, Not for profit and non governmental organization
are as follows:
Profit organization Not-for-profit Non-government
organisation
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The main purpose of these
type of organization is to earn
profitability level at market
place.
Under this, the main aim of
this business organization is to
develop economic growth by
providing better services to
their customers.
These type of organizations
are work for enhancing social
welfare by delivering their
various services to society.
Profit organisation are known
by private sector in which they
work for attaining higher
profitability level in market
place.
Not-for-profit type of
companies are comes under
private sector in which they
operate their business with the
aim of improving economic
condition.
These companies are known
by NGO in which they focus
on society benefits which may
leads in enhancing the
economic growth.
The main example of this
sectors is Marks & Spencer.
Under this, NHS is best
example of this sector.
Oxfam is also an important
example of this type
organization.
In addition of this, there are three type of organisation which comes under in three sector
such as private, public and voluntary. All these are operate their business with their specific
purpose which helps in improving the overall performance of the company at market place. Al
these are understood by following description:
Private sector : These type of companies are operate as well as run by private people and
groups with the purpose of attaining profitability level in market place. For this company
responsible for providing quality services to their customers as per their needs and demand in
order to attain better satisfaction. Along with this, these type of organization is not controllable
by the government bodies but at the same time also restricted by state authorities. In this they
direct these companies to operate their business in private sectors in order to achieve desirable
goals and objectives.
Marks and Spencer is famous as well as biggest retail company as they serve diversified
products and services to its customers (Bovee, Thill and Raina, 2016). This company established
in 1884 with the purpose of capturing larger market share. In addition of this, company also has
approx 979 stores in UK.
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Purpose of company:
The main purpose of Marks and Spencer is to be a leading retail company at global level.
For this they serve variety of products such as clothing, food, luxury and home products to large
number of customers. With the help of this company easily earn larger profitability by retaining
loyalty customers for longer period of time.
Public sector: These type of business organisation is controllable by national, state and
local government in which they operate their business for proving quality services to customers
for their betterment at market place (Cavalcante, Kesting and Ulhøi, 2011). Along with this,
companies are formulate their activities with the purpose of satisfying society needs and
requirements which may leads in improving the overall performance of the company and
economic condition as well. In addition of this, NHS is operate their business in public sectors in
which they provide free medical services and facilities to society which may leads in developing
their condition and living standard as well.
Purpose of company:
Under this, the main purpose of NHS is to serve basic medical facilities to society in
order to improve their health and living standard as well. This will directly impact on economic
condition in most effective manner. Along with this, company also provide quality services to
their poor customers with the purpose of maximising safety to society.
Voluntary organisation: These type of business work for betterment of the society by
providing them better services as per their needs. Basically they are not for attaining profits
because the main aim of these kind of companies is to enhance social welfare which directly
contribute in developing the economic condition in most effective manner. For enhancing as well
as establishing these companies, government authorities also provide them support to fulfilling
customers needs and wants in an appropriate manner.
Oxfam is comes under this sector, in which they operate their business with the aim of
remove poverty from the society. This company established in 1942 for providing social services
to society. In this various volunteers provide their support to companies to provide better
services to society.
Purpose of Oxfam:
The main purpose of Oxfam is to develop better policies which helps in removing
poverty within the society (Hair, 2015). Along with this, they also provide educational
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programmes to society in order to improve the skills and knowledge. In addition of this, they also
work for developing the overall country by providing better services to society.
P2 Size and scope of the organisations
In today's business environment every organisation having their specific size and scope
which differentiate from other business at market. In this small, medium and large size of
companies are operate their business at market place with the aim of attaining better success in
market place (Hamilton and Webster, 2015). It also includes the effective interrelation among
supply and demand. All these organisation are mentioned below:
Micro: Under this, very small companies are operate their business with less amount.
Along with this, firm also include less than nine workers for performing their activities. These
type of organization also having less than €2 million turnover. Basically the main purpose of
these organization is to gain profitability for surviving their life. It also include family members
which are established by one and two person. In addition of this, the main objective of this
business organization is to serving quality services to their customers for attaining profitability
level. These type of business organization having limited area and network in which they
operate their services.
Small and medium: This size consider private owned company, partnership and sole
proprietorship which include less workers who work for business in order to earn set profitability
level at market place. Along with this, these type of business organization also get government
support to improve their performance level by generating high profitability. In this context, small
and medium companies also include more than 50 and less 200 workers for operating business
activities. Under this, the main objective of these type of organization is to invite larger number
of customers by proving quality services in order to attain profitability level. With the help of
this company easily attain better success at market place by capturing larger market share.
Large: These type of business organization operate their activities at larger scale in
which they include more than 250 workers with the purpose of attaining better success at market
place. Along with this, government also provide better support to these companies at the time of
operating their activities in which they easily enhance their performance level by delivering as
well as serving quality services to its customers as per their needs. In, addition of this, the main
objectives of these business organization is to capture larger market share by expanding
operations at global level (Karagiorgos, Drogalas and Giovanis, 2011). With the help of this
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company easily attain better success at market place and at the same time also create strong
customers base. In this the main example of this type of organization is Marks and Spencer
which operate their activities as well as operations in various countries with the purpose of
attaining better success.
P3 Organisation structures and functions
Every business organization set some functions and organisational structure which is
interrelate with each others. All the functions of the company is perform their activities for
attaining better results. In context of this, Marks and Spencer also operate their business at larger
level in which they include various functions like marketing, human resource, finance,
operations and many more (Kolk, 2016). All these are helps in attaining set goals and objectives
in most effective manner which contribute in getting better success at market place. In addition
of this, all the department having their specific roles and responsibilities which may aid in
improving the performance level of the company at market place. As company operate their
business at global level so that they perform their activities for grabbing larger market share form
its rivals. All these functions are operate their activities with the purpose of attaining set goals
and objectives which directly contribute in capturing larger market share at market place. In
addition of this, organizational structure also play vital role in enhancing the overall sales in
which firm offer quality services to its customers as per their needs and wants which may leads
in attaining profitability level. In this context, there are some department and their interrelations
can be understood by following points: Marketing: It is one of the important department of Marks and Spencer in which
company promote their products and services with the purpose of attracting larger
number of customers over there. For attaining the same, company also undertake market
research to determine customers needs and wants. In addition of this, they also evaluate
strategies to compete their competitors. Along with this, it is link with the finance
department in which they allocate enough funds to marketing department. By this
manager of marketing department effectively use advanced tools and techniques to
promote customers awareness in market place. Human resource: It is also an important department which play vital role in planning as
well as coordinating all the activities of the workers at workplace. Along with this, it also
include recruitment and selection, performance appraisal, remuneration determination
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and training and development. With the help of this Marks and Spencer include skilled
workers within their workforce which contribute in attaining set goals and objectives in
appropriate period of time (Nishitani and et. al., 2012). In addition of this, company also
attain better success in market place by operating their activities. Finance: This department play vital role in business organization because it helps in
executing all the activities in effective manner. For running business activities proper
fund is more important because it helps in promoting as well as implementing all the
activities in effective manner. With the help of this Marks and Spencer easily
accomplished their set goals and objectives in appropriate period of time. Along with
this, it also helps in improving the performance level of the company in most effective
manner. For this, manager also prepare effective budget for determining requirements of
the company which directly contribute in attaining set goals and objectives ion
appropriate period of time. Operations: Under this department, company produce as well as manufacture quality
goods and services as per customers needs and wants which may leads in improving their
performance level at market place. Basically this department is related with the
production process of the company in which Marks and Spencer serve their services as
per customers needs in order to attain their higher satisfaction. This will aid in attaining
better growth level at market place.
 Research and development: It is also consider as an important department in which
manager of the company undertake effective research to understand about marketing
strategies, competitors and customers preferences as well. With the help of this company
perform accordingly and provide quality services to their customers as per their needs
and wants. In context of Marks and Spencer as they operate their activities with the aim
of attaining better satisfaction. With the help of this company easily attain desirable
growth level at market place.
Apart form this, organizational structure is also helps in improving the performance level
because it interrelate with its function in most effective manner (Osterwalder and Pigneur,
2010). All these can be understood by following points:
Function based: It is one of the important and common structure in which all the
workers are set as per their work and performance. Basically it includes human resource,
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marketing, finance and many more. All these are perform their work separately with the aim of
attaining set goals and objectives in appropriate period of time.
Geography based: It is also consider as an important structure which is based on the
geographic region in order to attain better success at market place (Pikka, Iskanius and Page,
2011). With the help of this company improve their performance and at the same time also
capture larger market share.
Customers based structure: Under this structure, company set their services as per
customers needs and wants because the main aim of this company is to satisfy their customers
by providing them quality services. With the help of this structure company easily capture larger
market share by retaining loyal customers for longer period of time.
Product organisational structure: This type of structure is based on specific products
which offer by the company to its customers. In this Marks and Spencer serve diversified
products to their customers in order to increase their profitability level at market place.
Thus, all these are play vital role in business organization in attaining desirable goals and
objectives. With the help of this company attain higher growth level at market place.
TASK 2
P4 Identify the positive and negative impacts the macro environment has upon the UK retail
sector
For running business activities in smooth manner, it is important for company to analyse
as well as determine positive and negative impact of macro environment within the organization.
With the help of this, company easily enhance their performance level at market place by
grabbing opportunities in effective manner. In context of Marks and Spencer, it is multinational
company which operate their business at global level with the aim of attaining better success at
market place. In addition of this, company also operate their business on more than 30 countries.
In this they serve diversified products such as clothing, food and many more which may leads in
enhancing profitability level of the company. Along with this, company also evaluate the
environment by determining the positive and negative impact of macro environment by
analysing the PESTLE. All these are as follows:
Political factors: It includes various rules and regulations of government authority which is
important for company to follow as well as implement within their activities (Pulver, 2012). By
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this Marks and Spencer easily improve their performance level and at the same time also capture
larger market share.
 Positive impact: Stability in UK government is beneficial for company at market place.
 Negative impact: Number of restrictions in UK government negatively impact on
company.
Economical factors: It includes tax rates, many more factors are largely affect the overall
business activities in which they have to implement as well as consider within this their activities
(Reed and et. al., 2013). For attaining better success it helps in improving productivity level of
the company at market place.
 Positive impact: If economic condition is favourable then it positively affect the overall
performance of the company.
 Negative impact: If income level of customers is low that it reduce the profitability level.
Social factors: In today's market customers needs and wants are rapidly change so that it is
important for Marks and Spencer to produce their products as per customers needs which may
leads in improving the overall performance of the company. As per this company offer clothing
products at affordable cost which may leads in creating strong customers base within business
organization.
 Positive impact: This positively affect the performance of Marks and Spencer in which
they serve quality products and services by creating string customers base.
 Negative impact: Changes in customers taste and preferences negatively impact on
overall performance of the company.
Technological factors: For surviving in retail market, it is important for Marks and Spencer to
use new and advanced technologies within their operational activities which may leads in
increasing the profitability level of the company at market place. With the help of this company
manage as well as protect their relevant information from any kind of crime. This will aid in
creating positive brand image of the company at market place.
 Positive impact: By using new and advanced technologies company easily increase their
performance by delivering quality products and services.
 Negative impact: It also increase the overall cost of the company which negatively
impact on business activities.
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Legal factors: For attaining better success at market place, it is important for Marks and Spencer
to follow all the legal rules and legislations in relation of intellectual property. With the help of
this company improve their performance level at market place. In addition of this, various tools
are defined such as trademark, copy right and many more which protect the company image at
market place (Reinhardt and Stavins, 2010). Thus, it is important duty of manager to follow all
the rules in order to reducing the negative impact upon the business activities. With the help of
this company enhance their productivity level at market place. It also provides number of
opportunities to the company at the time of expanding operational activities in which company
easily attain better success.
 Positive impact: By implementing all these rules and regulation company easily enhance
their positive brand image at market place.
 Negative impact: If company have not focus on legal prospectus than they are face issues
and obstacles.
Environmental factors: It is one of the important duty of business organization to ensure that
their operational activities does not provide any harm to environment. Thus, company needs to
use as well as develop environment friendly process to produce quality products in order to
satisfy customers needs and wants in most effective manner. Along with this, they also set and
formulate appropriate strategies to reduce the negative impact on business which may leads in
improving the overall performance of the company. BY using eco-friendly tools and
technologies are beneficial for company to enhance their sales and profitability as well.
 Positive impact: The favourable impact of this is to provide support to society which may
leads in improving the overall performance of the company at market place.
 Negative impact: If company does not use environment friendly technologies than they
are responsible for penalty which negatively impact on brand image of the company.
P5 Internal and external analysis of a UK Supermarket to identify its strengths and weaknesses
SWOT analysis:
Strengths Weaknesses
 Strong content with current industry
trends.
 Poor financial presentation of the
company at market place.
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 Engagement in action related to
business firm social obligation which is
extremely effective.
 Effective electronic commercialism
structure.
 Strongly emphasize on improving
customer experience.
 future of Marks & Spencer at China is
highly uncertain.
 High uncertainty on industry of United
Kingdom which makes it compromising
to situation of activity in local nation.
 Goods and services recalls are regular
which leads to decrease in self-
confidence of clients.
Opportunities Threats
 Finance programme for Indian market.
 Configuration of their wearable clothes
portion.
 Online beingness of firm to strengthen
their industry perspective.
 Simplification of their operational
working model.
 Dynamic trends in clothing space at
store.
 Reduction of superior at post Brexit.
Porter's five force model:
Bargaining power of suppliers: In this section Marks & Spencer has able retain their
power of bargaining at superior level as compare to suppliers at market place. They have
essential player at market place with major performance of supply chain section of the company.
Bargaining power of buyers: Buyer has several option at market place so that they have
take decision according to their need and wants. So that customers has higher bargaining and
influenced capabilities in which organisation has product goods and services according to their
demand.
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Threat of new entrants: In this sector, high threat of new entrance at market place
because of low entry barriers and any one easily entire into this industry and sell their product
and services in order to achieve goals and objective effectively.
Threat of substitutes: Low switching cost has build create negative issues for Marks &
Spencer and it reduce their profitability in long period of time (Shigang, 2010). Management of
Marks & Spencer want to make high switching cost for their clients so that they are able to retain
them effectively in long period of time.
Rivalry among competitors: High rivalry among competitors has create negative issues
for Marks & Spencer at market place.
P6 Strengths and weaknesses interrelate with external macro factors
Company strength and weaknesses are highly related with macro factors which helps in
determining the opportunities in which company enhance their performance level at market
place. It also helps in expanding business activities for attaining competitive advantage at global
level.
Political: It includes all the laws and regulations which implement by the company in order to
manage ethical performance at market place.
Strength: By implementing all the laws and legislation company easily run their business
at market place.
Weakness: If company fails in following all the legislation than it hamper on business
organization in negative manner.
Economic: It includes various factors like GDP rate, interest rates and many more which directly
influence the operational activities of the company.
Strength: Good economic condition of the country helps in enhancing overall growth of
the company at market place (Pulver, 2012).
Weakness: If any kind of variations are occur then it directly impact on purchasing power
of the customers which negatively impact on overall performance of the company.
Social: Marks and Spencer fulfil customers needs and wants by providing quality services to
them.
Strength: Marks and Spencer consider all the social activities within their activities which
contribute in improving brand image of the company at market place
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Weakness: Producing low quality of products company may reduce their overall sales
which negatively impact on brand image of the company.
Technological: In today's market various changes in technologies are take place which directly
affect the company and its activities as well.
Strength: By adopting new and advanced technologies company easily attain
competitive advantage at market place (Pikka, Iskanius and Page, 2011).
Weakness: If company ignore chances in technologies and use old technologies within
their activities then it reduce growth level of the company.
CONCLUSION
From the above mentioned report, it can be concluded that business environment is
consider as an important role which may directly affect the overall performance of the company
at market place. Thus it is important for manager to effectively asses and determine all the
factors that influence the company activities. With the help of this company easily improve their
overall performance by implementing all the environmental factors within their process. In
addition of this, various department are also working in organisation which are interrelate with
the organisational function. All these are marketing, finance, operational and human resources
which may contribute in attaining better success at market place.
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REFERENCES
Books and Journals
Avramenko, A., 2012. Enhancing students' employability through business simulation.
Education+ Training. 54(5). pp.355-367.
Bovee, C. L., Thill, J. V. and Raina, R. L., 2016. Business communication today. Pearson
Education India.
Cavalcante, S., Kesting, P. and Ulhøi, J., 2011. Business model dynamics and innovation:(re)
establishing the missing linkages. Management Decision. 49(8). pp.1327-1342.
Hair, J. F., 2015. Essentials of business research methods. ME Sharpe.
Hamilton, L. and Webster, P., 2015. The international business environment. Oxford University
Press, USA.
Karagiorgos, T., Drogalas, G. and Giovanis, N., 2011. Evaluation of the effectiveness of internal
audit in Greek Hotel Business.
Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World Business. 51(1).
pp.23-34.
Nishitani, K. and et. al., 2012. Are firms' voluntary environmental management activities
beneficial for the environment and business? An empirical study focusing on Japanese
manufacturing firms. Journal of environmental management. 105. pp.121-130.
Osterwalder, A. and Pigneur, Y., 2010. Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Osterwalder, A. and Pigneur, Y., 2010. Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Pikka, V., Iskanius, P. and Page, T., 2011. The business enabling network–a tool for regional
development.International Journal of Innovation and Regional Development. 3(3-4).
pp.324-344.
Pulver, S., 2012. Business and the Environment.
Reed, O. L. and et. al., 2013. The legal and regulatory environment of business (p. 328).
McGraw-Hill/Irwin.
Reinhardt, F. L. and Stavins, R. N., 2010. Corporate social responsibility, business strategy, and
the environment. Oxford Review of Economic Policy. 26(2). pp.164-181.
Shigang, Y., 2010. Competitive strategy and business environment: The case of small enterprises
in China. Asian Social Science. 6(11). p.64.
Online:
Business Environment. 2018. [Online]. Available
through:<https://www.slideshare.net/NikhilSoares/business-environment-
featuresmeaningimportanceobjectives-porters-model>
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