Business and the business environment introduction Introduction

BUSINESS AND THE BUSINESS ENVIRONMENT INTRODUCTION 3 TASK 13 P1 Different types and purposes of organisations; public, private and voluntary sectors and legal structures 3 P2 Explain size and scope of a range of different types of organisations 6 TASK 27 P3 Explain relationship between different organisational functions and how they link to organisational objectives and structure 7 TASK 38 P4 Identify positive and negative impacts of macro environment has upon business operations 8 TASK 410 P5 Conduct internal and external analysis to identify strengths

BUSINESS AND THE
BUSINESS ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Different types and purposes of organisations; public, private and voluntary sectors and
legal structures............................................................................................................................3
P2 Explain size and scope of a range of different types of organisations...................................6
TASK 2............................................................................................................................................7
P3 Explain relationship between different organisational functions and how they link to
organisational objectives and structure.......................................................................................7
TASK 3............................................................................................................................................8
P4 Identify positive and negative impacts macro environment has upon business operations...8
TASK 4..........................................................................................................................................10
P5 Conduct internal and external analysis to identify strengths and weaknesses.....................10
P6 Explain how strengths and weaknesses interrelate with external macro factors.................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business is an activity where products and services are exchanged from one to another
for seek of money. All the business and their action took place in competitive market. In order to
survive, sustain and grow in market rules and regulation should be followed. Similarly, business
environment is combination of internal and external factors which can influence organisation or
business. The environment plays vital role in running of enterprise successfully to gain
competitive edge (Avramenko, 2012). The present report is based on TESCO which was founded
in 1919 at England, United Kingdom. It is retail business which deals in various products such as
hypermarket, supermarket, convenience shop and superstore. Here all three public, private and
voluntary organisation has been selected such as NHS, TESCO and Oxfam and their scope,
purpose, structure, size has been discussed respectively. It also highlight about different
organisational functions, external, internal and macro environment along with positive and
negative aspects.
TASK 1
P1 Different types and purposes of organisations; public, private and voluntary sectors and legal
structures
Organization is a group of people who are engaged in a particular purpose in a business
or government department. There could be different motives of different organizational types
such as public, private and volunteer. All of these organizations have different task and different
motives. As per scenario given in this questions three organisation has been selected in terms of
public, private and voluntary. All these has different vision, mission, purpose, types, structure
and others which are explained below:
Public Organisation
These organizations are managed and operated by government and have main purpose of
providing services to the citizens of country. These organizations does not focus on earning
profit but wants to do better for the society. The public sector organisation used here is National
Health Services.
National Health Service (NHS) was established in 1948 at England. This was mainly
formed to provide health care service to individuals. The main motto was to provide service
rather than earning profits (Ballard and et. al., 2012). It is also considered as largest single payer

healthcare group in world. This deals in providing emergency and infectious diseases treatment
to everyone at free cost of cost including visitors. The types, purpose and legal structure of NHS
are as follows:
Types- There are three types of public organisation such as:
 Public Corporation- This is created through special act of parliament which has separate
scope, power, legal status and guided by motive of service. This is managed and financed
by Board of Directors an d government and accountable to parliament.
 Government Company- The organisation created under company act which has separate
status. The ownership of government ranges from 51% to 100% and follow regulations
and rules.
 Departmental Undertaking- This type of organisation is developed by government and
has no legal separate status. This follows rules and regulation of government. All the
activities are based on business oriented having service motive (Charter, 2017).
Purpose- The purpose is to work together for achievement of healthiest life for every
individual. It also includes:
 Vision- To deliver better care, value and health to people.
 Mission- To provide quality care to each and every person per day.
 Objectives- The objective is to keep individual healthy and reducing inequalities. They
provide open access regarding information of performance, services and treatment.
Legal Structure- After analysing all types of public organisation, it can be concluded
that NHS follow public corporation legal structure as it is created through special act of
parliament and works with motive of providing service.
Private Organisation
These are the organizations which are operated and maintained by the an individual and
group of individuals. These organizations have the main purpose of earning profit as much as
possible. Although, they have operate their activities within the regulations set by the
government but still their main focus is on earning the profit. The private sector organization
taken here is Tesco.
TESCO is multinational British general and groceries retailer which was founded in 1919
at England, United Kingdom. It is considered as third and ninth largest retailer in world in terms
of gross revenues and revenue (Belás and et. al ., 2015). It is serving its goods and service

globally for the benefits of consumers. There are 6569 number of location where TESCO shop is
established.
Types- There are different types of private organisations which are described below: Sole Proprietorship- This is the organisation where business is managed, controlled and
owned by single or one person. All liabilities, risks are beard by that individual only and
enjoy whole profit. Partnership- It is the association where two or more individual form an organisation
under an agreement that is called partnership agreement. The profit, risk, losses all are
shared equally by all members.
 Multinational Corporations- These are defined as organisation which operates their
business and activities and extend their network and branches in various countries.
Purpose- The main purpose is serving people and shopper every day in better and
effective manner. It also include following: Vision- To be highly valued business in terms of communities where business is
operated, consumers they served and committed and loyal shareholder and colleagues. Mission- The mission is making better which matters them together.
 Objectives- The objective is to become leading retailer supermarket and providing high
quality goods and service with low cost as compared to competitors.
Legal Structure- After analysing different types of private organisation, it can be said
that TESO follow multinational corporation legal structure. As it is providing goods and service
globally and fulfilling need and requirement of consumers. There are several branches of this
firm in different parts of world.
Voluntary Organisation
These organizations are also maintained and operated by the individuals and group of
individuals. These organizations does neither focuses on earning profit nor provide any type of
services but they work for the betterment of society. There main motive is to help, assistance and
convenience to a particular group of society. The organization taken here is Oxfam.
Oxfam is charitable organisation which was founded in 1942 by 20 independent firms. It
mainly focus on removing global poverty, pro-migration and disaster relief (Cohen and
Kietzmann, 2014). The goal is to assist people directly for removing poverty and provide justice
to each and every people.

Types- The different types of voluntary organisation are mentioned below:
 Unincorporated Association- It is organisation that is incorporated with agreement
among group of individual coming together for providing service rather than earning
profit. Such type of firm does not require registration and cost required for set up is zero
(Craig and Campbell, 2012).
Purpose- The main purpose of Oxfam is assist and creating solution for injustice of
poverty. It includes: Vision- The vision of Oxfam is to make world without poverty. This organisation want
where each and every people should be treated and valued equally, providing right to
them to enjoy their life as citizens and influence decision for better survival. Mission- The mission is to assist solutions for injustice of poverty. As they are part of
global environment for change, creating future which is secure, free from poverty. They
work for removing poverty from local as well as global level.
 Objectives- The objective is to use collection of sustainable development programs, fair
trade, advocacy, campaigns, public education and aid in conflict and disasters.
Legal Structure- After analysing various types of voluntary organisation, it can be said
that Oxfam has Unincorporated association legal structure. As it is formed with an agreement to
provide service to individual. It is formed mainly to eradicate poverty from world.
P2 Explain size and scope of a range of different types of organisations
There are different types of organisation running their business in market. They all are
established with various objectives and purpose. Also, they have different size and scope which
are described below:
Public Organisation
The size and scope of NHS are as follows:
Size- There are 6500 number of employees working in 50 sites of England. As it work for
the welfare of people to provide them health care service in different parts of world.
Scope- NHS is running business in various countries to provide free treatment of
emergency and diseases. It has scope to expand its business and operations in different parts of
world apart from England, Israel and others. Through expansion in other it can helps a lot to
individual and provide them treatment on time (Groebner and et. al ., 2013).
Private Organisation

TESCO has following size and scope which is given below:
Size- The size of TESCO is very large as it is serving goods worldwide. As per data of
2017, there are 460,000 employees working in TESCO. There are 6569 number of locations
where it has established shop in market.
Scope- The scope of firm is large as it has an opportunity to expand market in various
parts of world. Currently, it is serving products and services in United Kingdom, India, Thailand,
Hungary, Ireland, Malaysia, Czech Republic. Apart from these countries it can do further
expansion in different location.
Voluntary Organisation
The size and scope of Oxfam is described below:
Size- Currently, there are 5300 employees working with Oxfam worldwide and more than
22,000 volunteers. They work for welfare of people and provide them assistance in removing
poverty, disaster. As size of Oxfam is not big as compared to other (Hair Jr and et. al ., 2015).
Scope- It work with motive of removing poverty in world so it has an opportunity to
collaborate with other organisation in order to achieve their goals and objective. The scope of
firm is large as it can expand business in different parts of world.
TASK 2
P3 Explain relationship between different organisational functions and how they link to
organisational objectives and structure
There are various activities which need to be carried out by organisation. In order to carry
such task, each department play vital role to get success. These all working functions or
department work together for achievement of objective and structure. The relationship between
different organisational functions with objective and structure are described below:
Human Resource and Marketing- The requirement of number of manpower in
organisation is decided by HR manager of TESCO with help of marketing manager. As they
analyse market and inform HR about skills, capabilities required within employees. The capable
and skilled staff works for achievement of goals and objectives (Hillary, 2017). TESCO follow
multinational corporation structure which requires experience and skilled worker to work in
business. Thus, in this way both department work together for result achievement.

Finance and Marketing- Finance department is the most important among all as it plan
cost or budget for various activities and work that need to be carried out. The marketing provide
help to finance regarding requirement of money for promotional, purchasing functions. In order
to achieve objectives and structure both need to work together. TESCO is large organisation
which require proper budgeting plan for each and every activities.
Operations and Marketing- The operation department of TESCO need to manage
process of creation of products and services. As they involve in organising, planning, controlling
and coordinating all resource with help of marketing department. The marketing provide
information and operation carry out activities and task. As per structure of organisation, the
operation can be vary from one to another as large firm has more operating activities than small
(Hilton and Platt, 2013). Thus, in this way both department work for betterment of TESCO.
TASK 3
P4 Identify positive and negative impacts macro environment has upon business operations
Macro environment is the situation which exists in economy rather than specified region
and sector. There are different factors of macro environment on business operation which is
explained with help of PESTLE with positive and negative impacts. It is described below:
PESTLE analysis
It is tool that is used for the purpose of analysing and monitoring macro environmental
factors which impact organisation (Janita and Miranda, 2013). PESTLE analysis consists of six
elements which are described below:
Political Factors- The intervenes of government in an economy is called political
factors. This can be political stability, corruption, government policy, tax policy, foreign trade
policy and others. These factors can directly impact education system, business, infrastructure.
TESCO is operating it business in 12 countries that include Europe and Asia. The political
situation of both countries is different from each others. Positive Impact- If there is stability in political condition then expansion can be done.
 Negative Impact- The import duty charged by China and East Asia can affect TESCO as
it imports some parts of inventory outside UK. This factors create risk for both investor
and British Economy.

Economic Factors- The determinants of performance of economy is called economic
factors which includes exchange rate, interest rate, disposable income, inflation (Laudon and
Traver, 2016). These factors can influence price, cost, demand, and profits of TESCO. This firm
mainly depends on business from UK food market which is declining day by day. Positive Impact- Whenever there is decline value of pounds, then customers can buy
more quantity at less price which is positive impact to organisation.
 Negative Impact- Due to economic factor, there is high unemployment levels which
decline demand for various goods. TESOC is affected by UK food market as it mainly
depend upon this business more.
Social Factors- It is defined as demographic characteristics, customs, norms and values
of population within enterprise where operation took place. It includes age distribution, income,
career, lifestyle, health and safety and more. TESCO believe in serving high quality goods and
services as per their requirement which help them to sustain in market. Positive Impact- This factor provide positive benefit to TESCO as it has increased
amount of non food items for their consumer to sale. Also, it provide goods and services
as per need and requirement of consumers which helps in earning profits.
 Negative Impact- If TESCO does not analyse market properly then it cannot know about
taste, preference and demand of consumers which leads to failure of business.
Technological Factors- The innovation in technology which can affect operations of
industry that can be favourable or unfavourable. This can in terms of level of innovation,
automation, technology incentive, research and development (Prins and Cybercrime, 2011).
TESCO can adopt new and updated technology for manufacturing process. Before
implementing, proper research and development required to be done for better outcome. Positive Impact- Through use of technology, it can be provide help to TESCO for fast
manufacturing and fulfilling consumer requirement. This can lead saving of time and
increment of profit.
 Negative Impact- The adoption of new technology leads high cost to TESCO which is
negative impact to firm. If it produce those product which does not provide satisfaction to
consumer then there is high loss to organisation.
Legal Factors- The laws which are legal in nature and need to be followed by business
running their operation in environment. It includes consumer law, copyright and patent,

employment, discrimination law. TESCO should follow all legal law while manufacturing
products. TESCO has done discrimination on basis of age, gender for which legal action was
taken by employee. Positive Impact- Food Retailing Commission (FRC) can strict TESCO to produce goods
and services accordingly. This can help them to follow all legal standards.
 Negative Impact- If legal laws are not followed by TESCO then it can be penalised and
goodwill and value decline in market.
Environmental Factors- These factors are related with environment and which has
become significant due to increase in scarcity of raw materials, carbon footprint, pollution target
that are set by government (Savrul, Incekara and Sener, 2014). It includes weather, climatic
changes and more. While doing manufacturing, less pollution tools should be used by TESCO in
order to protect environment. Positive Impact- As TESCO encourages their customers to shop from tesco.com where
drivers does not only use fuel saving route but collect plastic bags from consumers.
 Negative Impact- If laws of environment are not followed then it has to face problems
and government can impose penalty for it (PESTLE Analysis of Tesco, 2019).
TASK 4
P5 Conduct internal and external analysis to identify strengths and weaknesses
The internal and external analysis to identify strengths and weaknesses is explained with
help of SWOT analysis which is given below:
SWOT analysis
It is planning tool which help business or individual to identify strengths, weaknesses,
opportunities and threats for competition or project planning (Avramenko, 2012). It is explained
below:
Strengths- TESCO has won various awards for customer service, retail excellence and
shopping experience. It serves diversified and wide customer base services to their people. The
strength of TESCO is strong product portfolio as it provide kinds of goods and having patent
license for their products.

Weaknesses- The weaknesses of TESCO is infringement controversies and concentrated
operations. As legal cost of TESCO has increased for infringement claims which effect buisness
and image of organisation.
Opportunities- TESCO has various opportunities where it can expand market and earn
maximum profits. It can do continue research and development for survival and strategic
acquisitions.
Threats- The threats which can be faced by TESCO are global expansion of market by
competitors and variation in seasonal activities. Also the pressure from stakeholder regarding
social responsibility and environment can impact TESCO.
P6 Explain how strengths and weaknesses interrelate with external macro factors
The strengths and weaknesses interrelate with external macro factors are as follows:
Political Factors- The strength and weaknesses are as follows: Strengths- Due to stability of political situation, TESCO can easily expand business and
earn maximum profit and sustainability.
 Weaknesses- The tax can be high if importing is done from China or East Asia.
Economic Factors- The interrelation of strength and weaknesses are given below: Strengths- TESCO can purchase more raw materials at low cost and can do more
production by paying less due to decrease value of pounds.
 Weaknesses- If there is more unemployment in country, then purchasing power also
decline which create decrease in profit of TESCO.
Social Factors- The impact of social factors in terms of strengths and weaknesses are: Strengths- When taste and preference of customers are known then products are
manufactured accordingly which leads to maximize profit earning (Belás and et. al .,
2015).
 Weaknesses- Without knowing about customer if goods are produced by TESCO then it
has to face failure in competitive market.
Technological Factors- The technological factors strengths and weaknesses are
mentioned: Strengths- The use of technology leads high production which requires less manpower
for manufacturing that helps in saving cost and increasing profit.

 Weaknesses- TESCO has to bear high cost for new and updated technology which is
weaknesses as those invested cost can be used for market research for new expansion.
Environmental Factors-The strengths and weaknesses are as follows: Strengths- TESCO provide help to their consumers regarding purchase of products where
driver itself come and give product and collect waste. This create goodwill and image for
organisation in competitive market.
 Weaknesses- The instant change in environment can hamper produced products which is
weaknesses for it (Ballard and et. al., 2012).
Legal Factors- The legal factors include following strengths and weaknesses which are
given below: Strengths- The legal set standard help TESCO in creation of goodwill and brand value
which attract investor to invest in business that leads to increase in profits.
 Weaknesses- The following of each and every standards by TESCO leads time
consuming and high cost for production.
CONCLUSION
From above report, it can be concluded that, in order to expand business in environment
various factors should be considered. This report has explained about private, public and
voluntary organisation along with their scope, mission and vision. Each and every department
work together for achievement of goal and objective. For business operation, PESTLE should be
analysed very carefully which helps in knowing about competitors, economic condition and
more. The internal and external analysis can aid organisation for knowing their strength and
weaknesses.

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Online
PESTLE Analysis of Tesco. 2019. [Online]. Available through:
<https://www.marketingtutor.net/tesco-pestle-analysis/>.
SWOT Analysis of Tesco Corporation. 2019. [Online]. Available through:
<https://www.marketing91.com/swot-analysis-of-tesco-corporation/>.