Business Environment and Management Report

The report provides an in-depth analysis of the business environment of Tesco, including its structure and organizational styles. It also examines the external factors that influence the company's decision-making and operations. The report is based on various sources, including books and journals, which provide insights into the relationship between business environment and competitive priorities, as well as the impact of young firm financing on business success.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK .............................................................................................................................................1
P1. Evaluation of different type and purpose of an organisation................................................1
P2. Description of various stakeholders who influence the purpose of business organisations. 3
P3. How two business are organised...........................................................................................4
P4. How the organisation styles help them to fulfil their purpose..............................................6
P6. political, legal and social factors are impacting upon the business activities of an
organisation.................................................................................................................................7
P5. Analyse the influence of two contrasting economic environment on business activities
within the chosen organisation..................................................................................................10
CONCLUSION..............................................................................................................................10
REFERNCES.................................................................................................................................12

INTRODUCTION
Business environment is collection of all internal or external factors like customers needs
and requirement, employees, demand and supply, owners, suppliers, management, clients and so
on. These factors influence functions of the company and focuses on how company works
directly or indirectly. Collection of these factors affect the situation and conditions of an business
enterprises. Business environment helps in analysing the useful resources and opportunities of
business in a effective manner. In this present report Oxfam is taken as a voluntary organisation
which is a global movement of so many people who share the belief that, in a global scenario
where poverty is not inevitable. On the other side Tesco Plc is taken as a private company which
is a multinational retailer company. This report contain several topics such as types of business,
purpose of purpose of private or voluntary organization. Along with this it will discussed about
the various stakeholders who affect the business purpose. Apart from this business situations and
various styles of an organisation which is helpful for the company will going to be explained in
this. Lastly, this report will be end up by explanation of political, economical, social factors
impact these businesses (Zur, Muehlen and Shapiro, 2015).
TASK
P1. Evaluation of different type and purpose of an organisation
There are two types of organisation which are given below:
TESCO
It is a British multinational grocery store and general trade retailer company which is
founded in 1919 by Jack Cohen on the basis of market stalls and their headquarters in Tesco
house Welwyn Garden City England. It is the third biggest retailer company in the world
measured by total revenues. This company expanded their business rapidly and through 1939
company had over 100 Tesco shops across the world. It is a private organisation which runs their
business with the goal of making net income by an individual, partnership, association or agency.
This is distributed in all over the surroundings of UK.
Purpose: The main purpose of Tesco is to be the best for customers and serving them to
enjoy a better quality of life and easiest manner of living. This is because customers want good
products at great values which they can purchase easily. Therefore, company provide their better
quality of product and it is their responsibility to fulfil the customers demand in a right way.
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Nature: Tesco launch their first outlet in Edgware, North London in 1929. it is
established by John Cohen and T.E. Stockwell. This company always used different strategies to
create customer loyalty. It reached the billion pound ratio in 1979. therefore, it became the
biggest retailer company in Unites Kingdom.
Private Limited Company
It is type of privately held small business entity, in which the proprietor liability is limited
to their shares and shares are prohibited from being publicity traded. Therefore, business is a
legal entity.
Limited liability and its importance to a limited company: It is type of liability where a
person's financial liability is limited to a fixed amount, most commonly the worth of a person's
investment in a company or partnership. The importance of limited liability is that there is a
crucial protection for stockholder in a company and they can only set the value of their
investment. Other importance is that limited liability does not defend against fraudulent trading.
Limited company setup: In the setup of limited company, liability of members and
subscribers of the company is limited by shares or guarantee. These company publish a notice in
the newspaper, submit it and then create an limited liability company operating agreement get on
the same page with the business partners and lastly set up the LLC.
HMRC requirements for the company: This term stand for Her Majesty's Revenue and
Customs, it is a non-ministerial department of the UK government which is responsible for the
collection of taxes and performing in the effective manner in the atmosphere of UK. In the
context of private company HMRC is required because it collect tax from privately owned
enterprises (Weiss, 2014).
OXFAM
It is a connection of 20 independent charitable organisations which is consideration on
the comfort of global poverty. This direction is a type of non profit organisation which was
established in 1942 by Cecil Jackson-Cole in England. This company operates their business
globally.
Purpose: The main goal of this company is to help in making permanent solutions to the
unfairness of poverty. There vision is to have poverty free world, in which people can enjoy their
rights and able to take decisions regarding their responsibilities.
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Setting up a charity
There are six steps to setting up a charity in a effective manner, which are given below:
 First step is to find trustees for the charity.
 In the second step, purpose should be identify and ensure that these benefits only for the
public.
 In this third step, name of charity should be specify.
 In the fourth step, determine the structure of charity.
 In the fifth step, develop a governing document
 And at last, charity should be register.
Charity is not a profitable organisation and it is a separate legal entity from its officers,
directors, employees and incorporators. For a charity, limited liability survive between the
respective trustee or board of directors and the charity itself. It assist the trustee and board
associates from being personally liable for the charity financial obligation. A charity can get
money through several ways like sales of product, donations, publicity and performances etc.
there are lot of roots by which revenue can be created for a charity. A charity spends their money
in various charitable activities like generating funds and so on (Savrul, Incekara and Sener,
2014).
P2. Description of various stakeholders who influence the purpose of business organisations
Business Stakeholders: These are influenced by the organisation's action, objectives and
policies. There are some key example of stakeholders like creditors, employees, directors,
suppliers, union, owners and the community through which the business designs its resources.
On the other side without support of stakeholders, business would end to exist. Mainly business
stakeholders are of two types, which are given below:
Internal Stakeholders- These are the entities within the business for example managers,
employees, BOD, investors. Internal stakeholders want to achieve high reward and keep
maintain their job. According to these stakeholders any firm can enhance their profit at higher
level.
External Stakeholders- These are the entities which are not included in a business
activities but they are influenced by its performance like regulators, consumers, suppliers and
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investors. In the other words they are the candidates who outside the business and do not involve
inside the business activities.
Charity Stakeholders- The stakeholders refers to the group or single person that has an
interest in the non profit of business. Some charity stakeholders are donors, board members,
foundations, business services or customers, local community, members and volunteers.
Stakeholders Expectations:
Expectation of employees- expectation of employees is more monetary and non
monetary benefits which provide to them with increment in profits. This is common expectations
towards an extent of organisation levels and profits have to utilised for social involvement.
Expectation of customers- The feedback and reviews of customers about the product are
to be determine through the organisation, as customers are the most essential stakeholders of the
business.
Expectation of government- The state or central government expects that taxes must
paid on time by the people and the rules which are develop through the government related with
the pollution and environment should be followed in a perfect manner (Osterwalder and Pigneur,
2010).
Why stakeholders are able to influence the organisation:
In the context of business, stakeholder is an investor whose action analyse the outcome of
business decisions. There are lot of stake holders who have a power to achieve success for an
organisation. Therefore, for the company stakeholders are very much valuable assets and an
organisation never want to lose that assets.
P3. How two business are organised
Structure of an organisation can be defined by the ample number of functions they use to
perform in effective manner, so that the goals and objectives of organisation can get achieved.
TESCO is one of the biggest retail organisation in world, and they use to perform several number
of functions, which work together to attain the goals and objectives of organisation. Every unit
have their own roles and responsibilities which they have to fulfil so that the tasks can get
completed. Different functioning areas of TESCO, that define structure of them are as follow :-
 Marketing Department: Marketing department is one of the most important department
of TESCO, as it is very much essential for them to make proper strategies and plans for
this department. This help them in proving their products and services to their customers.
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Also there are ample number of tasks which employees in marketing department have to
perform, like promotions of products and services in targeted area. Also employees in
marketing department of TESCO use to provide different sources to different
departments like information that what is new trend in market, raw materials which is
required, funds and other. These functions of marketing department help other
department in gaining proper information and resources for completing the work in
effective manner.
 Human Resource Management: This is considered as one of the most important
department for an organisation, as this help them in maintaining their human resources
working with them in organisation. This will help TESCO in making proper relation
between their employees and superiors also, along with this, it will help them in
maintaining proper work force in different departments of their functioning so that they
can work in effective manner. Also it will work to hire capable and skilful employees for
different departments in TESCO, so that men power in those department remain stronger,
by which achieving tasks become effective for them. This also help employees in gaining
some training and development sessions, so that their skills of individuals get improved.
This will help them in gaining their goals and objectives, by which it become easier for
organisation in gaining their aims and objectives. The HR department of TESCO has
committed to make the TESCO lotus a great place to work (Moutinho, 2011).
 Sales Department: This is the base department of an organisation, as this help them in
making direct connection between customers of organisation and organisation which is
providing service. Therefore, it is very important for organisations to make proper set of
rules and regulations for their sales department, which will help them in attaining their
targets and objectives. TESCO have described the roles and responsibilities to their sales
department that they have to to increase their sales and profitable. This also will help
them in increasing their customer base and also help in increasing the market share. This
department also help them in gaining knowledge that what changes are required in their
products and services, so that they can attract ample number of customers.
All the department in organisation like TESCO are inter related and have roles and
responsibilities which are dependent on performance of other department. This help employees
on gaining their goals and objectives and also help them in performing their activities in very
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smooth manner. Also it help in attaining the goals and objectives of organisation, in a specific
time period which was decided earlier. These practices help employees of organisation in
increase their job satisfaction and also help in making their customers in getting experience with
the products and services offered by them and meet satisfaction level.
P4. How the organisation styles help them to fulfil their purpose
The aim of organisation depends upon the business in which a company dealing. For the
better understanding of the organisation styles there is a example, the purpose of organisation
will be little bit different from profit of an organisation in the global business environment.
Furthermore, a business organisation need to have a clear sense of direction in order to deal with
their customers and which is must be clear in stakeholders mind, so that they can get desired
goals and objectives in a effective manner (Kew and Stredwick, 2017). In the context of Tesco, it
is an multinational retail company and the styles of this industry is dealing in retail sector which
helps them in providing their services and product directly to the end users. All these factors help
them in order to analysing the improve in needs of their users, so that they can easily make
changes in their products and services according to the customer needs and requirement. These
all are helpful for company in order to attain goals and objectives which are setted by them.
Therefore, these organization styles help them to fulfil the purpose of the company in a effective
manner.
P5. Analyse the influence of two contrasting economic environment on business activities within
the chosen organisation
Boom occurs when there in increased in commercial activities within a business, market,
industry or economy as a whole. The spending by the consumers is increased due to
improvement in the economy. Further, the level of employment goes high which attracts more
candidates to apply for jobs because of positive outcomes. However, it is difficult to find
sufficient staff for the work. A long term boom can affect the credit lending negatively due to the
fact that majority of financial crisis in countries and banks have been initiated by booms. Boom
business environment is one of the key factors for investors to invest. More funds are
channelised during this period. Company will avoid to employ more staff because they would
have to pay high wages. More advertisement will be to attract the customers with added value.
More stores together with variety of product range will be opened. Production will be increased
to maximise the profits and loss of the recession period will be recovered. Profits will be high
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due to high demands. Credits will be cheap as there are high demands so interest rates will be
low. There will be increased in borrowings.
Recession is a business cycle where by the economic growth slowdown and businesses
face downturn. The consumer spending decline due to lack of confidence. The employment is
declined. The increased borrowings in boom period crush the economy which have worst effect
during recession. The investment goes down due to low price of stocks and securities. The
businessperson may cut the interest rate to minimise the cost of borrowing.
P6. political, legal and social factors are impacting upon the business activities of an organisation
Basic TESCO OXFAM
Political Stable political condition of a
nation will help TESCO in
making proper plans and
strategies which are helpful and
lead the organisation in gaining
good start in their business
(Hunter, Saunders and
Constance, 2016). Where as
unstable political conditions
lead to create problem for
TESCO and also lead them in
facing ample number of issues.
Along with this, change in
governmental policies in a
nation will lead TESCO in
facing several problem
associated with their plans and
policies.
OXFAM is a not profitable
group, therefore they do not
have any major impact on
their functioning due to
change in political policies
of that nation. But they
need fund to perform their
operations, for this they
need donations, and change
in governmental policies
will lead to create problem
for them in gaining some
donations. Therefore,
change in taxation policies
of government can create
problem for them, as it can
be possible that they have
to pay tax for the donation
they received.
Social TESCO is huge organisation
and perform their activities in
OXFAM use to provide
their service for benefit of
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the nation which have huge
market and population, as this
help them in serving their
products and service to ample
number of customers at single
time. Also, it is very important
for them to understand the age
structure of the market, as this
will help them in gaining
knowledge that what type of
products and service of them
will get popular in market
place.
society, therefore it is very
important for them to study
the social factor of nation.
This will help them in
making strategies by which
maximum number of
people in society can get
benefits of it. Along with
this, they have to maintain
and work according to the
ethics of business, as this
will help them in attracting
big organisations towards
their charitable work.
Legal TESCO is huge organisation
and they have their own set of
rules and regulations, which
they and their employees have
follow (Karagiorgos, Drogalas
and Giovanis, 2011). This have
very specific impression over
the decisions made by
organisation, as they have to
keep in mind that the rules and
regulation do not get affected
by new decisions and also
decisions are according to rules.
Along with this TESCO have to
consider that they do not make
any strategy or activity which is
against Trade Discrimination
OXFAM is non profitable
organisation, which work in
the favour of society. They
have member which do not
need salary, but also have
some employees which
work for salary only. Here
they have to consider the
employment act of nation,
so that they can take proper
decisions and do not get
participated in any type of
legal problems.
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Act, and also that they do not
provide wrong information to
their customers.
CONCLUSION
From the above report it has been concluded that, Business environment is the
combination of two factors macro and micro which influences the functions of an organisation
including consumers, management demand and employees. Furthermore, report has described
about the purpose and nature of two contrast business entities, in which first was Tesco taken as
private organisation and other one was Oxfam which is a non profit organisation. There are
various stakeholders who influence these businesses are also explained in the report by achieving
the desired goals. Along with this various functioning area which explain the structure of Tesco
in following report. In addition to this how organisation styles helps them to gain the specific
purpose. It also identified the political, legal and social factor which have impact on the business
activities of an organisation. At last, it is end up by the external factors of business environment
which influences the business decision and impact the business in order to achieve the desired
goals.
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REFERNCES
Books and Journals
Bovee, C. L., Thill, J. V. and Raina, R. L., 2016. Business communication today. Pearson
Education India.
Cai, S. and Yang, Z., 2014. On the relationship between business environment and competitive
priorities: The role of performance frontiers. International Journal of Production
Economics.151. pp.131-145.
Chavis, L. W., Klapper, L. F. and Love, I., 2011. The impact of the business environment on
young firm financing. The world bank economic review. 25(3). pp.486-507.
Erasmus, B., Strydom, J.W. and Rudansky-Kloppers, S. eds., 2016. Introduction to business
management. Oxford University Press Southern Africa.
Halbert, T. and Ingulli, E., 2011. Law and ethics in the business environment. Cengage Learning.
Hilton, R.W. and Platt, D.E., 2013. Managerial accounting: creating value in a dynamic business
environment. McGraw-Hill Education.
Hunter, I., Saunders, J. and Constance, S., 2016. HR business partners. Routledge.
Karagiorgos, T., Drogalas, G. and Giovanis, N., 2011. Evaluation of the effectiveness of internal
audit in Greek Hotel Business.
Kew, J. and Stredwick, J., 2017. Business environment: managing in a strategic context. Kogan
Page Publishers.
Moutinho, L. ed., 2011. Strategic management in tourism. Cabi.
Osterwalder, A. and Pigneur, Y., 2010. Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Reed, O. L. and et. al., 2013. The legal and regulatory environment of business (p. 328).
McGraw-Hill/Irwin.
Savrul, M., Incekara, A. and Sener, S., 2014. The potential of e-commerce for SMEs in a
globalizing business environment. Procedia-Social and Behavioral Sciences. 150. pp.35-
45.
Weiss, J.W., 2014. Business ethics: A stakeholder and issues management approach. Berrett-
Koehler Publishers.
Zur Muehlen, M. and Shapiro, R., 2015. Business process analytics. In Handbook on Business
Process Management 2(pp. 243-263). Springer, Berlin, Heidelberg.
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