Business Model Innovation and Open Innovation

This assignment delves into the concept of business model evolution, highlighting its importance in today's rapidly changing business environment. It examines the role of open innovation as a key driver for business model innovation, analyzing various strategies and frameworks employed by organizations to successfully navigate this dynamic landscape. The assignment draws upon academic research and real-world examples to illustrate the complexities and opportunities associated with evolving business models.

BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
(Covered in PPT)........................................................................................................................1
P3 Relationship between functions of several company.............................................................1
TASK 2............................................................................................................................................3
P4 Positive and negative influence of macro environment.........................................................3
P5 External and internal analysis of company to identify strength and weakness......................4
P6 Weakness and strength interlinked with external factors......................................................2
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
The sum total of all particular person, institution and other external forces that are not in
control of enterprise but company is still depend on it because it affect the business sustainability
as well as its overall performance. Business can successfully establish but sustaining for a long
time within marketplace they have to analyse the environment of the business (Barnett and
Salomon, 2012). The changing requirements of buyers as well as new innovation are the part of
business environment. In order to survive within market they have to adopt changes as soon as
possible. If they are adopting a change it mean that they are aware of the business environment.
Starbucks is an American coffee organisation as well as coffee house chain. It was founded in
Seattle, Washington in 1971. They provide various products like as baked items, smoothies, tea,
coffee beverages, sandwich etc. This company give employment to approx 238,000 workers in
2016. In this report, various types of organisation are explained by its legal structure along with
that its size and scope of various types of firms. In this, relationship within various functions of
the company and also analyse the positive as well as negative impact of external factors.
TASK 1
(Covered in PPT)
P3 Relationship between functions of several company
Starbucks is a chain of coffee house, which is set up in Washington. They are giving their
services within the world. Cited companies should follow the structure of hierarchical within the
enterprise as well as it is indicated by their positions, obligations, duties, responsibilities and so
on are divided within proper manner to all employees of an organisation. Mainly, higher
authority department is having responsibilities as compared to low level unit.
Their are several objectives of Starbucks which are given below:
 It is important for manager to improve their enterprise as it aid in their development as
well as growth (Boons and Lüdeke-Freund, 2013).
 It is necessary to give better quality of products to buyers at cheaper rates, hence every
type of particular person ca purchase it.
 If organisation can improve their level of profits then they can easily give their best
returns to bondholders.
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 They require to provide every sort of financial instruments to their customers within
roof.
 It is important for them to decline they usefulness wastage, so they analyse business
environment properly and efficient way.
Various organisation functions are explained in detail below:
It is important for each type of company is to give better goods as well as administration
people, so that they can satisfy the wants as well as requirements of them in effective way
(Borio, Drehmann and Tsatsaronis, 2014). Its main purpose of Starbucks, there are several units
as well as they are having their own aim which is totally vary from others. Some of main
departments of Starbucks are as given below: Sales and marketing: It is important for every company to lead a research, hence they
can satisfy wants as well as requirements of their buyers. In this, they can develop
various techniques and it is linked with sales, promotional and pricing. With this, it is
important for organisation to keep on modifying their existing products as it will help in
increasing their sales and productivity as well. The unit require higher level of investment
so they can do effective marketing of goods and their services also. Finance: It is require for managers to maintain companies records efficiently as well as
effectively. They issue shares to persons which can easily increase their organisation
fund. Frequently, these departments are linked with each other due to their major aim is
to decide as well as create budget for others firms department. In addition, it is necessary
for them to maintain effective records of their all expenses as well as revenues. The major
obligations is to give budget to each section as well as all they require to follow it in an
effective way. With this, they have to decide pay wages or salaries as well as roll to their
employees. Human resource: Major responsibility of this department is to manage HR of Starbucks.
If business manager want to improve employees performance then it is necessary to
provide training to them (Bryman and Bell, 2015). In addition, it is necessary to provide
better workplace to their employees. So, they can accomplish their work in an adequate
manner. As its outcomes, it will help in retention of their workers for a long time within
the organisation along with that workers will accomplish their work within a limited
period of time. If Starbucks managers want to encourage their employees, then they
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provide commission, extra benefits, rewards and many more. It will aid in improving
their efficiency of work. HR manager can organise some sessions of motivational as well
as training to their workers as it will help in enhancing productivity. Administration: Main purpose is to give work support of the company. It is important to
manage firm in an effective way. In this division peoples accomplish their task as a
connection within employees and senior Starbucks managers. With this, they have to
encourage their members of staff, so they can satisfy their objectives and targets in an
proper way. Important department obligations is to give required data and information
which is linked with research. Therefore, they also arrange meetings in an effective
manner. Production: It is important for each firm to get assets properly so that employees can use
it in an effective way. Companies managers can use some of approaches that may
consists batch, job and many more. It department managers have to decline the cost
which is not necessary then it will aid in providing training to their employees. Its
outcomes will help in accomplishing task in an efficient and effective way. In addition,
the unnecessary price will decline then workers will able to complete their work within a
given budget.
 Research and development: It is an very main work for every company as manager has
to analyse the market and find out the present wants as well as needs of customers so they
can compete with their competitors effectively. In this, they can alter their products as
well as services in an adequate manner. Development and growth of business is mainly
depend on their units (Chang, Hughes and Hotho, 2011). If proper funds are available
then it will aid in working effectively. Its outcomes will aid in taking a competitive
advantages within a market place as well as it will increase the share of market.
TASK 2
P4 Positive and negative influence of macro environment
External environment is directly affecting the company as well as this kinds of factors are
not in hand of firms. It is very critical to analyse this external factor of the company. It is
important for managers to control their influence due to it can indirectly or directly affect the
enterprise. In addition, business can make some techniques and plans as discussed above.
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Starbucks managers have to find out the factors which affect the firm in an negative or
positive way. For that they have to organise a PESTEL analysis. By using this methods are very
easy as well as manager have to understand the external surrounding in an broader term. It aid in
enhancing strategic development as well as its extrinsic thinking by the help of research, they can
easily analyse their threats as well as it destroy their enterprise properly (Chavis, Klapper and
Love, 2011). Therefore, it will aid in achieving set targets and objectives in an efficient and
effective way. Thus, it will aid in competing with their competitors within a market along with
that it also improve companies reputation within marketplace. If managers of company will not
take an proper decisions within a limited period of time then external surrounding will affect
their enterprise.
PESTEL analysis are discussed in detail below: Political factors: There are its imperative that organisation faces is to require to adhere
regulations as well as laws within the nations. It is important because of enhancing
awareness of political factors and activism in the developing nations. Economical factors: In this Starbucks is an ongoing global economic recession, which
denote the companies profitability. Instead of cutting down of coffee consumptions are
shifting to less cost alternatives which will be the Starbucks opportunity. Social factors: Starbucks are providing offers at low alternatives without sacrificing its
product quality. Challenges faces by social factors is to enhance the base of buyers from
low rates as well as there is having a middle tier of income pyramid. Technological factors: Organisation have reap the advantage of latest technologies as
they have tied up with Apple to provide app based discount coupons. They had also
establish the capabilities of Wi-Fi in their outlets s that buyers can surf the web as well as
do their task by having coffee (Chesbrough, Vanhaverbeke and West, 2014). Environmental factors: Their are various concerns about enterprise practices from the
international advocacy groups, activists and by buyers themselves. It is having concerns
in continuously holding the buyers trust.
 Legal factors: Companies has to make sure that they do not operate afoul of regulations
as well as rules within nations from which it sources is home markets, raw materials in
UK.
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P5 External and internal analysis of company to identify strength and weakness
Internal and external analysis of the firm supports it to determine all aspects which can
affect future growth and sustainability of the company in direct and indirect manner (Crane and
Matten, 2016). The assessment can be done by SWOT analysis – it involves to identify strength,
weaknesses, opportunities and threats. Following is discussed internal and external analysis of a
business organisation.
SWOT analysis of Starbucks:-
STRENGTH WEAKNESS
One of the major strength of Starbucks as it has
established itself as a premium coffee house
chain having global market presence in
comparison with all fast food chains. Almost
products of Starbucks are of excellent quality
healthy ingredients, relatively consistent
between regions and seemingly environmental
friendly. It helps in attaining high profit
margins and sales revenues.
Due to a global brand, Starbucks has wide
range of workforce who is liable for generating
new and innovative products. The firm is also
known for treating employees in well being
manner and always focus on providing training
and development assistance to employees for
improving their skills and knowledge.
The brand is valued as $4 billion that is key
strength of the Starbucks in equivalence with
its rivals.
Starbucks is considered as top in customers'
mind when the requirement of coffee; it
symbolize effective quality at reasonable rate.
The business organisation has dominant
The main weakness of Starbucks is it is highly
dependent on key inputs, i.e. coffee beans
hence profitability of the company also relies
upon prices of coffee beans. In other words,
Starbucks is quite price sensitive towards
pricing fluctuations in this manner it needs to
diversify product range so as to diminish the
risk which is linked with these variables.
Starbucks is following premium pricing policy
in middle tiers of market segmentations; thus it
is not possible for most of the people to spend
much amount on Coffee brands.
It is essential for the company to diversify and
expand its product range in order to effectively
compete with competitors, such as – Burger
King, McDonald's. The main product of the
firm is Coffee and it is highly depended on the
same thus it requires to expand product range.
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position over the globe in respect of coffee and
beverages.
OPPORTUNITIES THREATS
Starbucks is focusing on expanding its
suppliers network in order to diversify sources
of raw materials. It also helps the company to
become less price sensitive and generate
resilient against risks which occurs due to
supply chain.
Expansion in emerging markets is one of great
opportunity for Starbucks; it results billions of
customers will joined the brand who wants to
instate coffee and other beverages.
Another opportunity for Starbucks is to expand
product range as same as its competitors; it
results enhancement of customers' number
which lead to take competitive advantage at
marketplace.
Rising prices of coffee beans and it is linked
with supply chain hence risks of fluctuations in
prices are major threat. Although raising prices
of dairy products has an adverse impact on
profitability of Starbucks.
The brand is facing intense competition with
rivals in global business environment, i.e. local
coffee houses and stores also offer coffee in
niche consumer segmentations (Business and
the environment, 2017).
P6 Weakness and strength interlinked with external factors
In this both analysis of PESTEL as well as SWOT is much valuable by organisation. By
the help of this it can easily analyse large as well as small scale surroundings. It play an very
main role in achieving goals and targets of organisation within a limited period of time. External
and internal surroundings are interconnected with one another as their responsibilities as per
companies. It any modification looked after particular person then division of operational of
Starbucks must affect because of broader thoughts by typical nature. In basic terms these two
analysis are interrelated with one another in their key perspective imagined SWOT is mainly
involve impressive of various parts which influence enterprise inside while PESTEL analysis
consists distinctive standards or regulated by approved government bodies.
Some of different goals of PESTEL recognise with SWOT which are given below:
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 Inside segments are able to decide all intrinsic problems of agents, customers, suppliers
etc. and on other side external involve every one feelings as well as gauges set by
government for making some of free space from any isolation.
 Updating of present problems as well as issues existing in an organisation.
 Proper allocation of important resources for accumulate imaginative things.
 Social affair of exact information as well as data by driving research programs.
 Proper process for supporting threat. Measuring of future price (Macro environmental forces. 2017).
All these above points shows an proper relations with internal as well as external
situation in view of its obligation and part towards achieving of association. As per above
discussed the factors it shows that both are interlinked with one another in various manner which
influence association achievement in light of the manner that these mechanical assemblies are
useful in the process of organizing as well as basic system of leadership (Marketing and business
environment, 2014).
Additionally, PESTLE as well as SWOT collect main data as well as information which
is useful in fulfilling the requirements of buyers demands. Therefore, this model is utilise by
organisation for understanding slants as well as taste of a buyers by coordinating the process of
examination.
CONCLUSION
As per above report it has been concluded that it is important for each type of
organisation to analyse its business environment in an effective manner. As its outcomes, they
can manage all the alterations very easily. Therefore, they can improve their organisation
reputation as well as its profits within a marketplace. In this assignment, they discussed about
various kinds of firms like as voluntary, private and public. In business, there are several
departments such as human resource, sales, marketing and many more. If organisation needs to
enhance their enterprise then it is necessary for them to establish a product with innovative
manner for their customers. In this, manager of firm can analyse the PESTEL and SWOT
research to comprehended internal and external environment. Hence, they can easily compete
with their competitors at commercial centre as well as increase their reputation within market
place.
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REFERENCES
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