Relationship between Finance & Marketing Department

BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................................3
LO1- Different types and purposes of organisations:.............................................................................3
Size and scope of different range of organisations:................................................................................5
LO2 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure.................................................................................................7
Positive and negative impacts the macro environment has upon business operations supported by
specific examples....................................................................................................................................9
Internal and external analysis of specific organisations for finding strengths and weaknesses: ........12
SWOT analysis of NHS:..........................................................................................................................14
Interrelation of strengths and weaknesses with external macro factors:............................................14
CONCLUSION.............................................................................................................................................15
REFERENCES..............................................................................................................................................17

INTRODUCTION
Business environment is a summation of all internal and external influential factors
which affects a business. These factors shapes the way a business is being conducted. With in
depth research being conducted in this report, it is being tried to understand about various
types of organisations that function in an economy, comparison between companies bearing
two different identities, defining characteristics of businesses, factors determining their
performances. Besides that, the report also seeks to address the determinants of macro &
micro business environment, relationship between various functions of the business
(Docherty and Nyhan, 2012). This report includes a brief analysis of an organisation's
business environment using analysis models offered by management theories and practices.
For better understating of business environment, a company named TESCO is chosen that
engaged in providing groceries items and it is UK based multinational firm. In public sector
the chosen organisation is NHS and in voluntary it is Oxfam that are studied in depth to
evaluate major factors of both the organisations.

LO1- Different types and purposes of organisations:
Organisation: An organisation is a social group of people where all the members of
the group strive to achieve common goals. An organisation is defined by the structural unit,
its purpose of formation, the respective roles assigned to each individual within the premise.
It is a legal entity formed as per the provisions enshrined in existing law of the land. They
work as an open systems under which they are prone to internal and external changes.
Types of organisation: There are varied types of organisations in UK which are
formed as per the business purpose, they have different characteristics, nature, liability and
legality. Based on the legal status provided to various organisations in UK as per the
framework of Companies act, 2006 are as follows:
PRIVATE COMPANY:
A privately held company is that whose scope is limited as it can't issue shares or
raise capital by way of share allocation from general public. A private company doesn't need
to have a minimum capital requirement and are limited to a threshold of maximum 50
shareholders. It is the most common kind of organisation formed due to its feasibility (Corral,
Sillitti and Succi, 2013). for example the Tesco is considered as the profit making company.
Purpose of Tesco:
The main purpose of Tesco is to create value for their potential consumers for the
lifetime to build them loyal consumers ( Clarke, Tamaschke and Liesch, 2013.). By offering
wide range of products and services enlarge the business opportunities in positive manner.
Legal structure of private organisation:
The legal structure of private organisation are as follows:
Sole trader:
sole trader operates one person business and needs small amount of finance to set up
their business. They only employ the waged employees and alone provide all kinds of finance
by bear all kinds of risk. Legal structure is not defied as it depend form each and other
depend on the owner. The benefit is that there is no other boss having maximum level of
privacy. On the other hand the business have maximum level of audibility without any level
of legal instruction.
Private limited company have is an kind of joint stock company that have separate
legal identity from their owners. They are small in nature and often run by family run

businesses owned and operated by shareholders. Tesco which is a private limited company
and owned and operated by shareholders.
Partnership:
Partnership firm should be build to overcome from problems of the sole traded. In
partnership which is an association of the individuals and have 2 to 20 partners in their
organisation. The company have the benefit of getting easy establish. But on other hand the
partner have audibility of debts in the business is considered to be unlimited.
PUBLIC LIMITED COMPANY
A public limited company can raise share capital by way of issuing shares to general
public, has a minimum capital requirement of £50,000 and minimum two directors (Becker,
Kugeler and Rosemann, 2013. ). The company act 2006, provides special rights to a
company formed irrespective of its nature like legal person status, can sue and be sued,
common seal, ownership of property in its name etc. for example organisation the Public
limited company is NHS which is a publicly funded national healthcare system in UK.
Purpose of the NHS:
The main purpose of NHS that provide comprehensive range of services as per the
consumers needs and preferences regarding patients, respective families and their carers.
There main motive is to give one of best services to the patients to cure well.
Legal structure of Public limited company:
Community interest company: This kind of company as the name suggests are
formed for the purpose for community development, social welfare and all the profits and
capital will only be used for the benefit of the community. They are not for profit
organisations.
Limited liability partnership: A LLP is a new kind of business organisation which
has dual set of characteristics of a company and a partnership firm. Under this setting, its
members have liabilities limited to their shares means scope of their liabilities are determined
by their respective share holding limit. Other feature is that the members can directly manage
the business as it happens in a partnership firm.
Sole proprietorship: A sole proprietorship is a single person entity where the sole
owner is one person who registers it. He has to nominate a nominee on his behalf to manage
the business in case he dies or becomes incapacitate to perform his duties (Saebi, Lien and
Foss, 2017).
VOLUNTARY ORGANISATION

Voluntary organisation which is not established for the profit making but give their
services for the social welfare. In that report for the voluntary organisation is Oxfam.
Purpose:
The main purpose or objective of Oxfam to provide assistance to people to get rid
them from poverty and kinds of social issues.
Legal Structure of voluntary organization:
Trustees: These are the individuals that contributes funds for the welfare common people.
Charity: These contributes or serves for the welfare of suffer and needy people.
An unincorporated association:
This is one of most important kind of structure of the voluntary organisation that are
best for the small groups with a membership builds the short term goals, low income and
many more. The benefit of company is about the no level of secrecy along with democratic
level of management. On other hand there is lack of secrecy and mutual interest in company.
International companies are mainly having the exporter along with importers as there is no
requirement of investment from outside there respective home country. On the other hand
the multinational companies have the level of investment in the other countries but there are
not allowed to have the coordination's in offering the products in each and every country.
With the extent to hat the global companies ha the investment present in many of other
countries which leading to have several levels of development.
Classification by size and scope
Micro- they are small business that employ few employees that is less than 10. There scope is
to serve local people.
SME- they are small and medium size independent firm that employ more than 50 and less
than 250 and total asset is less than €50 million. There scope is to serve entire nation
Large – it refers to those who are having more than 5000 employees working. The scope is to
expand and operate in home nation and at global level.
Local or national – an organisation or entity that is having a collective goal and operate at
local level in UK
Transnational- they are those organisations that operate in across state boundaries but are not
controlled by foreign policy.
Multinational – it is those organisation that is having headquarter is one country but its
production facilities are in other countries. For example- tesco
Global – they are those organisation that operate in many countries and have different
headquarters in other countries as well.