Business and the Business Environment

This document discusses the purpose and legal structures of different types of organizations, such as private, public, and voluntary sectors. It also explores the size and scope of organizations like General Motors and Jaguar. The interrelation of different organizational functions and their impact on organizational structure is examined. Additionally, the document analyzes the macro environmental factors affecting General Motors and Jaguar.

Business and the
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
P1 Purpose and legal structures of different types of organizations............................................3
P2 Size and scope of different types of organizations.................................................................4
P3 Interrelation of different organizational functions and their impacts on organizational
structure........................................................................................................................................5
P4 Macro environmental factors and their impact on general motors and jaguar.......................8
P5 Internal and external analysis of General motors and Jaguar...............................................10
P6 Relation of strengths and weaknesses of external environmental factors............................14
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................16

INTRODUCTION
Business environment is a collection of both internal and external factors such as
employees, customers, political, social and others which affect company's performance in both
positive and in a negative manner (Calabrese and et.al., 2018). Analysis of business environment
plays an important role as it helps companies in identifying all types of factors. This present
study is mainly based on General motors, which is an American multi-national automotive
corporation. It was founded in the year of 1908 by William C. Durant and Charies Stewart Mott.
This present study is going to show different types and purposes of organizations like public
sector, private sector and voluntary sector. It will also discuss their size and scope along with
legal structure. Furthermore, this study will discuss effectiveness of interrelation of functional
units of organization and their impacts on organizational structures and objectives as well. It also
shows importance of PESTLE analysis and SWOT analysis models in identifying or analysing
both internal as well as external business environmental factors which impacts on organizational
performance.
P1 Purpose and legal structures of different types of organizations
There are different types of organization which can be differentiated on the basis of their purpose
and legal structure. On the basis of legal structures and purpose, organization are being divided
into 3 types such as:
Private: It refers a type of business which is controlled and run by an individual and not
by the government. Such types of organizations earn profit out of the sales and it is their main
purpose. Private sector of organizations believes that by providing qualitative products to
customers they can maximize profits or their main purpose depend upon their innovation and
quality of products (Walker and et.al., 2017). Profit allows employees to get a raise in their
benefits. In addition, it can be said that such organizations generate revenue by competing
against big players and make sure that their products give value in relation to price to customers.
Because it is the main key of their success and by doing, so they can attract customers to the
great extent and take advantages of competition. Jaguar is a private sector of organization. It is a
British multinational car manufacturer, owned and produced by Jaguar Land Rover. Private
companies are incorporated and limited by shares which means company can have shareholders.

In the context of legal structure it can be said that private sector of organizations may be sole
traders and partnership.
Public: It refers and consists of all those companies whose controlling power is in the
hand of the government. They do not segment people and provides services to everyone
(Pedersen, 2018). Main purpose of such companies is to help people and improve their living
standards and not to earn money. Public sector companies are funded by the government and all
operations are being run by money collected from taxes and fees by all citizens. Providing better
and improved public services to general people such as education and others. All those
companies which are being traded and controlled by the government is known as public.
General motors is a public company as in the year of 2010 it became publicly traded company
(GM Celebrates its Rebirth as Publicly Traded Company, 2010). It is also an American
multinational automotive company, founded in the year of 1908. Public traded companies have a
separate legal entity and each shareholder becomes a part of it. They are funded directly by the
government for providing public services.
Voluntary: It consists of all those companies whose main aim is to improve health of
vulnerable and needy people. They are also known as community sector of organizations. They
do not focus on earning money or making profits as they only want to help people who are in
needs by providing them health care, education and others services in free of cost (Chen, Fah and
Jin, 2016). Oxfam is one of the voluntary confederation, having around 20 charitable
organizations. Main aim of this company is to decrease poverty and the gap between the poor
and the rich. An unincorporated association, trust and company limited by guarantee are legal
structures of voluntary sector of organizations.
P2 Size and scope of different types of organizations
Basis of
difference
Private Public voluntary
Size In the context of Jaguar,
which is a private company
it is found that it has around
43,224 employees. It sales
thousands of vehicles every
year. It operates worldwide.
General motors has
around 212,000
employees and it operates
in more than 140
countries. Products range
of this company includes:
In the context of Oxfam
it is found that it is a
global organization with
a massive reach. It has
reached around 22.2
million people in its

auto-mobiles, commercial
vehicles and auto-mobiles
parts.
assistance programs. It
has around 5500 people
who helped it out in
supporting to around 14
million people.
Scope In the context of scope of
this company it can be said
that it operates worldwide.
Its cars are built on its state-
of-the-art production lines
and it also makes use of IT
and Artificial intelligence
(Zhang, Han and Hui, 2018).
It makes it able to reach
global customers. By
focusing on quality and
reliability of products it
expands its business in other
countries.
Qualitative and wide
range of products shows
its extent of growth. It is
also found that for
expanding business and
increasing scope, it is
focusing on producing
zero emission of products
(Cole, 2020). It also can
help it out in improving
sustainability and
satisfying environmental
needs.
It is global organization,
works for ending and
reducing injustice of
poverty. It has a global
reputation and well-
known in all around the
world. It has also
conducted multiple donor
visits successfully
(Pickering-Saqqa, 2019).
So, from the above discussed size and scope it can be said that different types of
organizations it can be said that different types of organizations have different size and scope.
P3 Interrelation of different organizational functions and their impacts on organizational
structure
All sectors of organizations have functional departments and for better results they have to
interact or collaborate with each other. There is interrelation of functional departments of Jaguar
and General motors such as:
Marketing and sales: Marketing department of both companies are responsible for
promoting products of their company and attracting customers to the great extent. For this
purpose, they communicate with customers and identify their needs. On the other hand, sales
department is responsible for increasing sales of the company and for increasing sales there is

requirement of satisfying customers, and they can satisfy only when they provide qualitative
products as per their needs (Zhulina and et.al., 2020). So, for knowing needs and current market
conditions they have to communicate with marketing department. Marketing department of both
companies provide all informations to sales department and Hence, they accomplish their
individual goals in an effective manner.
HR and finance: Human resource is also an important functional department of Jaguar
and General Motors, whose main aim is to employ skilled workforce and making them able to
help company in accomplishing goals. For this purpose they require money as they have to invest
money for several functions including recruitment, training, selection, performance appraisal and
others. Whereas, finance department is responsible for managing company's cash-flow,
providing money to all functional units and track records (Ali, 2020). So, HR have to give all
details and informations related to money to finance department. It also helps finance department
in keeping records in an effective manner.
This interrelation helps them out in accomplishing overall goals. Jaguar wants to ensure
everyone benefits by working with it and satisfying needs of customers. It can be possible only
when, employees provide qualitative and unique products. It is found that marketing and sales
department mainly work and responsible for satisfaction of customers. General motors also want
to provide quality of products by which customers can receive superior value and it can e
possible when all departments work in an effective manner and focus on their performance
(Bouchez and et.al., 2020). So, overall it can be said that this interrelation of functional units
help companies in accomplishing of their goals.
This interrelation have direct impacts on organizational objectives and link with
organizational structures of both companies.
Functional vertical structure: It is found that Jaguar follows functional vertical organizational
structure. It is mixed with divisional in the middle management level and the whole as
functional. This company is independent joint venture between Chinese auto manufacturer Chery
Auto mobile and UK auto manufacturer. It is co-managed by president and deputy president.
This organizational structure of joint venture includes all functional units such as: marketing,
product development, manufacturer, finance, HR and others. They all work collaboratively and
this structure gives a path to employees for growth.

Flow of informations is also easy in this structure which allows them better
communication and interrelation. So, it can be said that interrelation have great impact on its
structure.
Regional divisional structure: In the context of General motors it is found that it
follows regional divisional organizational structure in which it groups business activities
according to the areas of operations. One of the main reasons of selecting or using this structure
is to support managerial decisions. Interrelation of functional units also help company in
improving decision and giving better outcomes. This structure also helps it out in satisfying
business needs. By making flow of informations among regional functional departments easier, it
makes their functions easier. They find ease in communicating with each other and exchange
informations. One of the other main advantages of this structure is it improves flexibility within
business which helps in responding to regional market variation (General Motors'
Organizational Structure, 2018). All these advantages are beneficial for all functional units as it
allows them in increasing sales and accomplishing their individual goals.
So, on the basis of above effectiveness of organizational structures, it can be said that
interrelation of functional units have link with these structures and have great impacts on it.
Illustration 1: Functional vertical structure
Sources: (Organizational Structure of Jaguar, 2016)

P4 Macro environmental factors and their impact on general motors and jaguar
There are several Micro environmental factors that affect the growth and profitability of
the business. It is necessary for the companies to identify those factors, so they can overcome
from the negative impact from the external factors (Reinhardt and et.al., 2017). Companies can
also have some positivity impact if they aware of all the factors, and they can create
opportunities in their business. Here is comparison of General Motors and Jaguar who are
competitors and both the companies are affect from the Micro environmental factors.
Pestle Analysis of GM and Jaguar
Factors General Motors Jaguar
Political Political factors has huge
impact on the GM motor's
profitability in certain market
or any resign. Some countries
political parties are corrupted,
and they ask for money if they
want to expand their business
in their country. This has huge
impact on the company.
Jaguar is also selling their
manufactured cars in all
around the world and mostly
they affect from the Tax
structure of the country. Every
country have different Tax
structure and that has directly
affect on the profitability of
the Jaguar
Economical Factors Economic factors such as fuel
prices also affect the demand
of the GM motors and
customers are looking for the
cars who provide better
average. Some of the other
pricing factors such as prices
of the steal is increasing day
by day and it increases the
prices of GM cars.
Level of unemployment, GDP
and similar economic factors
has huge impact on the Jaguar.
United states which is core
market for this company has
seen the better economic
activity last year and it helps to
improve sales of Jaguar
Social Gm motor's manufacture high
end vehicles for their
customers to fulfil their needs.
Jaguar provides premium cars
to their customers and their
main targets are the rich

They keep social status in their
mind so it enables them to
know what category people
will by affordable or high class
vehicle and what they need in
their vehicles (Dines, A,
2016). Their marketing
continuously work to
understand the market needs
and improvement they need in
their Motor, so they can come
up with better vehicles.
people who want to buy a
luxury cars and show their
status. Their cars are not
affordable for middle and low
class people. It is necessary for
the company to understand the
needs of other segmentation as
well.
Technological Gm has huge impact from the
ecological factors and it is
helping them to build
connection with the customers.
They are proving advance
technology in their vehicles
with the comfort. Not online
this but GM marketing team is
using social media to attached
with the people, and they are
successfully in this strategy.
General Motors can also
follow the new technology
trends within the market to
create opportunities for their
business and it will help them
to stay within the competition.
Jaguar is know for the cutting-
edge innovation in their
vehicles and their product
designs including
manufacturing. The aluminium
technology used by the Jaguar
is making their cars lighter
which helps to boost speed of
the car and performance as
well (Chodakowska, 2018).
Another best thing about this
company is that they are using
the best possibles' technology
within their car to satisfy their
customers thorough the
features within their cars and
most of the features are
autonomic in Jaguar.
Legal The General Motors operated Jaguar also follow all the low

their business under the laws
and they know every well
violating the laws in the any of
their market can create big
issues for them and it will
create bad image in their
customers mind, so they
follow all the legal rules and
governmental laws.
and regulation of the country
where they are operating their
business, and they focus to
create good relationship with
the countries' government to
create good image and also
pay their taxes on time that
affect their brand image in a
particular company.
Environmental Environment factor has huge
impact on the companies
reputation and helps them to
achieve success in their
business. General Motors has
been successfully working on
carbon emission of their
factors that created due to the
manufacturing. They have
open their manufacture turning
plant in the place where they
can e out of reach people, and
they can easily manufacture
the cars.
Jaguar also know that
environmental support from
their company is necessary.
They are working on the E-
cars that can work on thorough
the electricity and their main
motive by launching these cars
is to become ECO friendly and
E- cars are new technology
trends in the market that is
attracting customers to buy
and creating good images of
the other companies who are
selling E- cars to their
customers.
P5 Internal and external analysis of General motors and Jaguar
SWOT
General Motors Jaguar
Strength • General Motors is • Jaguar having good

having joint venture
with the local Chinese
automotive companies
that is helping them to
gain competitive
advantages.
• Companies image with
the markets are good
because they are
creating safe and eco-
friendly vehicles.
brand image because
they are providing high
quality products to
their customers.
• Firm is having strong
brad value in all around
the world.
• Advertisement by the
Jaguar is attractive
because of strong and
skilful marketing team.
Weakness • Reliance on pickup
trucks and SUVs for
sales growth
• Dependence on U.S. to
generate most of the
revenue
• Limited product range
of Jaguar as compared
to a few other
competitors (Laddha,
2016)
• After acquisition by
Tata, cost-cutting lead
to labor union issues
Opportunities • Decrease in fuel
efficiency in their
vehicles can provide
them opportunity to
sell more of their
products (Engelbrecht,
Lindeman and
Hoermann, 2019).
• E- cars can
opportunities for
General Motors
• Expansion of their
busies within the
emerging economies
like China, Russia etc.
• jaguar can come up
with the new models
within their SUV's to
take competitive
advantages.
Threat • US dollar exchange • Competition within the

rates are rising and it is
decreasing the
profitability of the
company.
market is very high and
Jaguar is getting huge
Competition from the
luxury brands from the
other countries.
Porter's five forces
Five forces General Motors Jaguar
Competitive rivalry The high aggressiveness of the firms
exerts a strong force in the GM
motors. There are many comparators
within the industry who are having
well- established market shares and
good brad image. It shows that the
competitive rivalry is high within the
market where General Motors is
operating their business.
Composition within
the automotive
industry is very high
because there are
many other companies
like Audi, Tesla and
other companies have
captured most of the
market.
Bargaining power of buyer Bargaining power of the customers is
law within the automotive industry
because customers buy their products
according to the segmentation with
the cars. People who want to buy car
goes with the luxury brand and
people who want to buy affordable
cars then they go with the cars like
General Motors (Mutuku, 2018).
Bargaining power of
the buyers is low for
the Jaguar prospective
because their
customers are rich
people who can buy
their cars easily so it
makes easy for them to
sell their products.
Bargaining power of supplier The bargain power of the supplier on
the General Motors is high because
of the raw material cost. There are
very few supplier available in this
market so General Motors have to
Suppliers bargaining
power is high for the
Jaguar and whole
industry as well.
Jaguar is using

buy raw material as the give prices of
the supplier.
aluminium in their
cars and prices of
aluminium is high and
there are limited
suppliers of aluminium
(Jelassi and Martínez-
López, 2020).
Threat of Substitute product the moderate accessibility of
substitutes approval a moderate force
on the automotive industry situation.
However, the intensity of the threat
of substitution against GM is weak
because of the low mixture of
substitutes
All the products within
the automotive
industry is substitute
abut quality and
market reputation
makes this threat force
low. Jaguar provides
quality cars to their
customers that
decrease the threat
from them.
Threat of new entrants Its hard for the new business to take
entry within the automotive industry
because it takes time for the
company to show their presence. Top
brands within the industry have
already established their brand name
like Gm motors. This means the
threat of new entrant is low on the
Gm motors company.
Its not easy for the
new business to take
entry within this
industry because of the
higher investment .

P6 Relation of strengths and weaknesses of external environmental factors
In the context of business environment it can be said that it is made up of both internal
and external business environmental factors. In internal business environment, company's own
strengths, weaknesses, opportunities and threats affects their performance and also affect
external business environmental factors. There is a link between internal and external business
environmental factors. For example: strength of general motors is it has improved image in the
market because it provides safe as well as environmental friendly products to customers. This
strength help it out increasing sustainability. Whereas, as per the social and environmental
factors there is requirement for automotive companies to produce zero carbon emission of
products and improve sustainability (Ye and Li, 2020). Otherwise, it may affect companies in a
negative manner. So, from this it can be said that there is a link between strengths and external
environmental factors and it can improve its overall performance. Link can be known by
identifying both factors in a detailed manner. It is also found that General Motors is mainly
dependent on US market for revenue generation and from economic factors it is found that high
fuel prices are affecting demand. So, it can be said that there is a link between external
environment and internal environmental factors.
In addition, weakness of Jaguar is it has limited range of products which can have several
negative impacts and such impacts can be known by identifying external environmental factors.
By analysing of external environmental and competitive analysis factors it is found that there is
high intensity of competition among existing players. For taking advantages of competition,
companies require providing qualitative and wide range and variety of products to customers But
its weakness can have negative impacts on its competitive advantage. This link is found by
analysis. By analysing and making link it can make changes in its strategies and improve areas
which needs to be improved (Piligrimienė and et.al., 2020). So, overall it can be said that
strengths and weaknesses have link with external environmental factors.
CONCLUSION
From the above study it has been summarized that there are various types of the
organization such as public private voluntary and legal and every type has different size and
scope. This report has been demonstrate the interrelationship of the various functions within the
organization and how they are connected with each other. It has been uses the contemporary
examples to demonstrate both positive and negative influence of the Micro environmental

factors. In the end of this report has been determined the internal and external strength of the
external micro factors.

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