Business and Business Environment

This document discusses the different types and purposes of organizations, their legal structures, and the size and scope of different organizations. It also explores the interrelationship between different organizational functions and the positive and negative impact of the macro environment on business operations.

Business and business
environment

Table of Contents
INTRODUCTION...........................................................................................................................2
MAIN BODY...................................................................................................................................3
Different types and purpose of organization................................................................................3
Size and scope of different organization......................................................................................5
Relationship between different organisational function .............................................................6
Positive and negative impact of macro environment...................................................................8
Internal and external analysis to identify strengths and weakness of the organization ............10
Interrelation of strengths and weaknesses with external macro factors ....................................11
CONCLUSION ............................................................................................................................13
References......................................................................................................................................14
................................................................................................................................37

INTRODUCTION
Business environment is a collection of all the individuals, elements, factors and other
forces which are extrinsic and intrinsic to organization yet, affect its production, growth, revenue
and the survival of business. As each and every organization in the market is operating its
activities in typical environment because no company can survive in isolation. Sainsbury is a
private company in Great Britain market. Covers lot of share's in the market and second largest
retailer in supermarket of groceries (Möller, Nenonen and Storbacka, 2020). Sainsbury is
founded by john James Sainsbury. NHS (national healthcare services) is a public corporation and
leading all the public companies in Great Britain. NHS is providing better healthcare to the
peoples with standard charges. National healthcare service are providing services to all the
peoples of Britain. International Red cross is a voluntary humanitarian movement having large
number of people participated in this, they have worldwide staff to serve. Red cross defend the
human life as well as their take care of health. This report will evaluate the different types and
purpose of organization and their respective legal structures. It will explain the size and scope of
different types of organisation. The report further evaluate the interrelations of types of
organization and how they connected with objectives and structures, impacts of macro
environment on activities of business and internal and external analysis of an organization to
check the strength and weakness and their interrelation with macro environment (Hans, 2018).
MAIN BODY
Different types and purpose of organization
An organization is an entity just like an institute or association which is having group of
peoples and having their purpose to work. The organization are mainly of three types private
sector, public sectors and voluntary. They have different purpose or objectives to achieve by
them.
Private organisation
This sector consists of organization or companies who are part of economy which used to
run by a particular person or group of person for profit and basically this is not controlled by
government. Hence, they are totally for making profit from the economy, business that are not
been controlled by state having their personal motive to run the business. Sainsbury is a private
sector organization in the market of Great Britain. Having approx sixteen percentage of share in
supermarket field. Sainsbury is providing quality of product and service to its customers. The

companies aimed to satisfy the customer with safety, health, fresh products and taste of their
food different from others (Jones and et. al., 2016).
As the Sainsbury is a private limited company so its first purpose is to make high profit to
expand there business wider and provide favourable returns to the shareholders. Sainsbury is
having motive to make their product so standard that they stand out in the market. Sainsbury also
focus on increase there sell to get higher revenue. Sainsbury is an international company do their
task globally.
Legal structure : Sainsbury is having partnership legal structure as the company is having there
family member to run the company and to calculate the profit of the business. The partners of
Sainsbury are of family, but they are different entity from one another. Sainsbury is set up with a
partnership deed in legally. The deed documents are proof of all the information regarding the
profit sharing ratio among the partners and their respective work and responsibility. Legal
structure also have explanation of the property division.
Public organisation
This includes both public enterprises and the public service. The public sector
organization involves goods of public and services provided by the government. This
organization generally do there activities to serve public, the services which benefits all the
peoples of society. NHS (national healthcare service) is a public organization which is serving
the peoples effectively. National healthcare service is governed by government they usually
operate with money crated by taxes. The organization is improving health of needs peoples and
there motive is not to earn profit their motive is to serve the peoples in a better manner.
NHS is performing its activities in Great Britain keep in mind the main objective to full
fill the social needs. NHS is giving their facilitates at very nominal prices. They mainly provide
medical services to the poor peoples so that they can over come from there weakness.
Legal structure: As the public companies are governed by government fully and partially the
NHS is full controlled by government so the enterprise is having its structure set by the central
government. The legal structure is run on practitioner of NHS and the method to treat the peoples

will doing its treatment so the finding by the government for the survival of NHS. National
healthcare service act also consist of legal structure of NHS.
Voluntary organization
This organization are governed by any trustee and having a clear motive to serve the
society. They are not for profit organization only uses to give service to society. International red
cross is an NGO having large amount of participates, Red cross is providing fast disaster help
services to the peoples so that people are not afraid to lose their lives and get a safe zone as well.
Red cross having millions of volunteers to protect the lives at the time of disaster.
Legal structure: International red cross is having trust legal structure in which normal and simple
when we compare it with other charitable companies the structure is rolled by a document of
trust called as deed (Bala and et. al., 2020).
Size and scope of different organization
Basically the organization have various size and scope
Minor enterprise Small-medium enterprise Large enterprise
 This kind of enterprise
generally have fewer
employees and their
turnover is also low.
 This enterprise have
lower capital as
compared to others.
 Minor enterprise uses
to operate and attracts
the area peoples and
serve them well as
there capital is less, so
 Small-medium
enterprise is having 50
to 250 employees
working for them and
their turnover is
relatively higher to
minor enterprise.
 Small-medium
enterprise having
enough capital that
they can run there
 Big or large
organization are having
thousands of
employees to work in
achievement of their
objectives.
 This is mostly large
companies having a
huge turnover, so they
used to operate in a
wider market as well.

they only focus on the
area where they are
operating there
business (Cornforth,
2020).
business effectively.
 These enterprise uses
to cover there state or
city peoples as there
operational area is big,
and they cover smilier
tradition peoples well.
 For ex., tesco is one of
large enterprise as they
are serving there
products internationally
and having a big
revenue out of sell.
The different types of organization are also having different size and scope because
private companies are generally owned by an individual, so they are relatively small and their
scope is also limited with its shareholders, the public organization are generally governed by
government so this is normally big organization because government organization used to serve
all the society, and they are operating on a big scale in the market and Volunteering organization
are governed by trustee who are serving the peoples on their behalf this organization are also
normally big because many trustees and helper are further connected with the organization and
make it a big one. Private company as Sainsbury is relatively small as their liabilities are tended
to limited with the companies shares and the private companies not able to list their shares in
stock exchange in the Britain. There are different SMEs who are private organization as in Great
Britain there is no minimum capital requirement for private organization they just need only one
share issued at time of integration. Sainsbury's is working for maximizing its profit so its scope is
limited to that only the company not want to do social work and there aim is just to build a strong
revenue in the market (Becker, Kunze and Vancea, 2017).
The NHS is a public sector company having a big size and scope because as it is
controlled by government and it works for the welfare of the society. NHS is providing a quality
of life to the society their aim is not to earn profit, but they are passionate towards the services
which they are giving to there society. NHS has set an affordable services prices to its society
peoples so that they can use the service whenever they needed. Hence, size and scope of NHS is
large then private organizations. The international red cross is a volunteering organization and
having people welfare motive the profit is not a all generated by this kind of organization. Red
cross is international help line who give help to people facing disaster. Red cross is having a
wider size and scope as it serve international society.

Relationship between different organisational function
There are various types of function being prevailing in the company and which are being
interrelated between each other which helps in achievement of organisational objectives and
goals of the company. There are
Interrelationship between human resource and marketing
The human resource department of the company is being focused around recruiting and
selecting qualified employees who possess relevant skills and talents to perform a specific job
where the the function of marketing department is to make reach the products and services of
Sainsbury available and reach towards the end customer where by this two functions are being
interconnected with each other in manner as it helps on the end of the human resource
department to recruit employees who can meet up with the sales targets of the company and who
can support in reaching to the end customers more effectively where by this two are being
interconnected as it helps in providing with employees who can effectively account with
conducting various marketing activities such as effective promotion and distribution of the goods
and services of Sainsbury which helps with enhancing up and building strong and fruitful
relationship with various parties of business operations. The both are being interrelated in a
manner as it accounts with knowing the sales force requirement on the end of the company to
meet desired sales target which supports the company with achievement of high rate of
profitability and account with building good brand image. These both are interrelated as they
account with meeting the training and development needs of employees in achievement of sales
targets which helps in assessment of various flaws and error on the part of employees and helps
with providing up with honest feedbacks which accounts to boost up the confidence and morale
of sales employees to thrive for better performance which helps in achievement of targets of the
company (Cornelis,2019).
Interrelationship between human resource and finance department
The two department in Sainsbury are being linked closely as they work together to ensure
that business is on the pace of continuous growth and development where by the finance
department work is to manage the budgets of the company and to ensure that all activities are in
connection with the same which accounts to smooth functioning of business of Sainsbury where
by finance department of the company ensures and let know to the human resource department at

what budget and cost to company they can hire it employees to perform a specific job role where
they both are interconnected in manner where at the end of each month human resource
department of Sainsbury prepares the list of the compensation, wages or can be said as the salary
which are required to be paid to its worker and employees and send the same with the approval
to finance department which is being further proceeded in banks to payment of the same (Tyagi,
2019). They two departments are being interconnected as it helps in laying down budget
allocation to various activities of human resource management in the company such as allocation
of budget for carrying various festivals and celebration at the workplace, accounts with the
budget for tea, coffee or any kind of refreshments for the same, making and allocating budgets
for providing cab services in management of human resource of the company and accounts with
effective and efficient allocation of resources and can also be understood as interconnection by
the means of providing rewards which are being in monetary terms to employees of the company
where by it is being evaluated by human resource department which relates with performance
appraisal that is being with and in budget of finance department.
Interrelationship between marketing and finance department
The working of this two department is crucial for the company as one function accounts
with increase in the revenues and other accounts with controlling the cost in the company which
accounts with meeting the future contingencies of the business where by marketing department
helps to make finance department to understand what budgets are being required on the end of
there side to make the product reach to the end customers more effectively and efficiently and
helps in ensuring the amount of funds which are being required on the end of conducting various
marketing and sales related activities which can be budget for advertisement of products and
services on TV and others which also lays down the budget of same in promoting through
various social media platform and others (Bou Zeineddine,Qumseya, 2020). These are
interrelated with each other as it helps in laying down the budget for the branding of the
company and various other things.
If the company fails with the same and does not accounts with the co-ordinating efforts of
various departments than it accounts with high conflicts at the workplace which results in
inefficiency to the organisation and activities not focused with aim to achieve success.

Positive and negative impact of macro environment
There are various impact of macro factors (positive and negative) on the functioning of
the business which accounts with how the business operations can be maintained, which could be
understood with
PESTEL analysis of Sainsbury – it includes factors such as
Political factors- there are various political factors which affect the functioning of the business
such as Brexit which has majorly impacted the business of the company as it has related with the
the affect of sales and revenues of the company and accounts with attracting large number of
customer base which can serves as the means of unfavourable condition for the company. It also
regards with the payment of various taxes to the government in power to ensure that it accounts
with smooth flow of business operations. These factor can also affect the company operation as
any changes with the government of the country accounts with the change in various business
policies, structure which can be in both the ways positive and negative which helps the business
to survive in various business dynamics and accounts to take challenging task and can accounts
to various other political factors which affect the functioning in the Sainsbury (Nandonde,2019).
Economic factors- This factors account with contributions being made by the company in the
growth of the country and with contribution being made in increasing the GDP of the country
and this factors helps in understanding the disposable incomes of the target audience to make the
purchasing decision towards the products and services of the company. These factors also
associate with the exchange rates being prevailing in the market which can affect the business
functioning in positive and negative manner in boosting up with the profitability of the company.
This should accounts with considering factor of removing unemployment in the economy which
serves as the positive means of generating favourable brand image. It also accounts with various
interest rates being prevailing in the industry which helps the company to plan operations at
Sainsbury in relevant manner.
Social factors – This factor accounts with various society culture. It will accounts to have shared
values and beliefs and attitudes of the population which plays a a great role for the marketers of
the company in designing and understanding the potential customers of given market and how
will they design there message which will be communicated to its target customer. It accounts
with factors such as demographics and skill level of the population where it also accounts with

various various education standards in the company and accounts with building relationship with
various parties to business operations(Bentham(Bentham,2018)
Technological factors- This is the most important factor which affect the business functioning
where the company has realised the importance and started with the building on the technology
infrastructure where by it accounts to technology such as artificial intelligence, bio metric and
other which helps in winning over the competition and accounts to security at the workplace and
getting things done with more effectiveness and efficiency.
Legal factors- this are generally factors which are being mostly related with political factors and
same in nature which can also be understood as factors such as laws and regulations which are
being prevailing in the region where the Sainsbury have its stores and non compliance to such
will lead to discontinuation of business operations and imposed with various restriction and
penalties which affect the brand image in unfavourable manner and can lead with the loss of
trust among its loyal customer which can lead with the loss of market share of the company
(Perera,2017).
Environment factors- these factors accounts with things which are related with the strategies
being made in concern wit the protection of environment and where by the operations of the
company are so well designed and built which accounts with the means to effective disposable of
waste and accounts with measures to discontinuation of carbon footprints where by company
ensures building trust of its target audience which helps the same with means of spread of
positive word of mouth as a result lead with building positive brand image of the company and
helps in accounting with higher margins of profitability at the company.
Internal and external analysis to identify strengths and weakness of the organization
The strengths and weakness of the organization through internal and external analysis is
defined in detail through SWOT analysis -
Strength – Sainsbury company has diversified business with strong market share. Currently
operating over customer supermarkets and online grocery, company acquires its key strength in
the marketing of the products which has proliferated its value in the business environment
(Sarsby, 2016). It is also one of the largest retailers in the clothing sector which has outgrown its
business in UK. Sainsbury has also expanded its market in the property ventures which becomes

a strength aspect for the company. Strong balance sheet of the company makes the company into
more profit access and being on the forefoot in sector, it has created a vast segment for the other
successful operations which is factor of strength for the company. Technology of the company is
the major strength as it evaluates the quick work process and the products which are produced
are of good quality.
Weakness – Sainsbury has a single operating market which creates difficulty for the company to
diversify its products in a single market structure (Phadermrod, Crowder and Wills, 2019). As
single operating market has created more competition for the company thus the company is more
prone to face product downfall which becomes weakness for the company. The other weakness
that the company acquires is the low margin food business which disturbs the finance of the
company. The large weakness of Sainsbury is that the company solely operates in one country
that is UK while its other competitors have expanded their market segment globally which helps
their business grow on large scales. The company has also not made an attempt to enter into new
market as they are not fully aware of the trends of the marketplace which is the biggest weakness
of the company.
Opportunities - Opportunities for the company is increased by expanding the market and
business through online collaborations via different online platforms which will generate more
leads and will help in creating a customer base to target customers for promoting the products
that will be consumed by them (Gürel and Tat, 2017). More the online promotion more will be
the sales of the product which will lead to profit. There also arises an opportunity for the
company to diverse and grow the Sainsbury bank which will help in the funding within different
segments and departments of the organization and the company will be able to calculate the
finance and the income that is generated each year by preparing proper balance sheet by
analysing the cash – flow statement the entity generates. Up-gradation in the technology will
increase the effectiveness and efficiency in producing the product which will enhance the work
also will generate more opportunities for the product enrichment. New dimensions for the
product will generate good quality products and will be more easier for the customers to compare
different types of products within the company.
Threat – The main threat to the company is through other competitors which are promoting and
selling their products into the same segmentation as of the Sainsbury. There are big companies
which generate more sales then Sainsbury which becomes major threat to the company and

organization as whole. There is an intense competition in grocery and retail segment of different
companies which is threat factor to Sainsbury as the company also deals in such segment. More
the other companies transform their business in this sector there will be increased threat to
Sainsbury. There is also an impact of Brexit on prices which affects the prices of Sainsbury and
creates more threat to the company as they can suffer from financial loss and their cost structure
can be damaged through increase in the prices. Threat of cyber – attacks to the company can
decrease the value and the leak the data or information which will demolish the reputation of the
company.
Interrelation of strengths and weaknesses with external macro factors
Strengths and weaknesses of the company are interrelated to the macro factors which
consist of -
Political Factors – The political factors acts as -
Strength for the Sainsbury Company to the whole organization as it helps in creating stability of
the policies and procedures that are generated and implemented by the government. It is defined
as strength because company will follow the rules and regulations which will be accordance of
the company's structural basis (Pan, Chen and Zhan, 2019). The taxation and fiscal policies will
be of great help to the company as it will help in analysing the financial base of different
operations in producing variety of products. These policies are a big strength to company as it
involves the governmental affairs which cannot be neglected by the company.
Economic Factors – The economic factors acts as -
Weakness for the company for it as the employees of the organization undergo unemployment
and the employment rates decreases according to the performance and qualification levels of the
employees. Being weakness for the company this factor if there is no employment will affect the
company at different aspects which will keep the working environment demotivated and the
pressure of performance for the other employees will increase eventually affecting the other
departmental operations and the company will face major downfall in the employment
generation program which will lead to bad reputation of the company in the market place thus
creating weakness.
Social Factors – Social factors acts as -

Strength for the company as the points like current trends in the market place, customer needs
and wants helps to create general awareness about them and this will benefit organization as
Sainsbury is more concerned about the customer desires to be fulfilled because they have
analysed the areas where the buyers are more inclined towards and what they wish to purchase.
The changing lifestyle of people or customers has lead to diversification in the products in which
Sainsbury deals (Yusop, 2018). Thus, this factor has been a strong sense in creating strength for
the organization on many grounds which are related to customers.
Technological Factors – Technological factor acts as -
Strength to the company as the advancement in the technology sector has lead to innovation in
the products that are being diversified on different grounds for selling purpose. Changes in
technology has enhanced the product formation process which makes it more qualitative and
usable . The digital technology has created more surface for customer engagement and the
channels have become easier in the product delivery process. The manufacturing and logistics of
the product has also helped in the up-gradation of the whole product as more the innovative ideas
in the selling process more will be the increase in the products that are been produced.
Environmental Factors – Environmental factors acts as -
Weakness to the company as changes in the environment which includes the ecological aspects
and the business environment affects the company leading to decrease in the operational
procedures of the organization. The environmental hazards have created more product disposal
and the wastage has increased the number products that have been failed to generate quality
products (Çitilci and Akbalık, 2020). The products harming the environment has created a
weakness aspect in the growth and development of the organization as whole. Thus, the
environment has impacted the products of Sainsbury in many ways resulting to loss of goals to
be conquered in the marketplace.
Legal Factors – Legal factors acts as
Weakness as the changes in the laws, rules, policies or regulations directly impact on the
company of which they are not aware. The changes in legal work procedures affect the
organization as they face many difficulties in changing the companies norms and legal
proceeding which decreases the efficiency and the customer base can be lost due to the changes
in the product formation also on the basis of different laws regulated.

CONCLUSION
Thus, from the above report we can conclude that the public, private and voluntary
sectors of the company defines their legal structure which helps the organizations to differentiate
it on the basis of what are key areas in which the company operates. The size and scope of
different type of organizations analyses the growth and development of the company
differentiating it on the terms of various organizational structures and defines its scope within
and outside the market structure. The interrelation between HR, Marketing and Finance is
described with the importance of each of the functions in different departments of the
organization. Positive and negative aspects which impacts the micro environment on its business
operations were explained that how they have affected the functioning and operations of the
business environment of the organization. The internal and external analysis helped in
identifying the SWOT(Strength, Weakness, Opportunity and Threat) analysis criteria for the
Sainsbury company along with the external macro factors that were been affected by the
strengths and weaknesses of the organization. Thus, the business environment of the company
helped in analysing the important and significant aspects that are beneficial for the growth of the
company and which instigates the company's different criteria on which the product has to be
sold by following rules and regulations of the organization as whole.

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