Business Environment - Assignment Sample

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Different type of organisation with their scope and size and legal structure....................3
P2 Sizes and Scope of different type of organisations...........................................................5
TASK 2............................................................................................................................................7
P3 The relationship between different organisational functions and how they link to
organisational objectives and structure..................................................................................7
TASK 3............................................................................................................................................8
P4Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples...........................................................................8
TASK 4 .........................................................................................................................................10
P5 Internal strength, weakness, opportunities and Threat of John Lewis ...........................10
P6 Interrelation of strengths and weaknesses with external macro factors..........................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
INTRODUCTION
Business environment refers to the combination of both internal as well as external
factors that has a influence on the operations of a company. Internal environment consist up of

employees, directors, management etc. On the other hand external environment consist up of
government, suppliers and many more (Andersson, Forsgren and Holm, 2015). It help in
identification of opportunities of business and planning which overall improves the performance
and profitability of the firm. In order to study this report John Lewis and partner is taken which
was founded by John Lewis in 1929 having the headquarter in London, UK. This report will
cover different type of organisation with their legal structure. Further more will also discuss
about the interrelationship between the different organisation functions and their link with the
objectives. At last discussion as made regarding the internal strength and weakness and their link
with the external environmental factors.
TASK 1
P1 Different type of organisation with their scope and size and legal structure
The different type of organisation with the purpose and their legal structure is mentioned
below:
Private sector organisation: These are the type of the organisation that are operate by
the individuals or group of people. They do not have any interference of government. The
organisation used here in the following study is John Lewis and Partners.
Purpose:
The main purpose of this company is to provide high quality clothing, home ware
products, foods products and financial services to its customers (Apăvăloaie, 2014). The main
objective of the company is to increase the sells of the company by keeping their employees
happy toward their work.
Types of private organisation:
 Sole Proprietorship: In such type of private sector organisation the business is owned
and controlled by a individual. He is only the one who is responsible for taking the
decision of the firm. This includes small business owners, contractors etc.
 Partnership: In such type of sector, business is operated by two or more individuals. The
power of decision lies in the hand of all partners. There is two type of partnership i.e.,
general partnership and limited partnership.
 Company: It is a independent legal entity which is separate from the owner. Here the
company consist up of unlimited liability and unlimited members.

Legal structure:
John Lewis and Partners in order to perform the activities follow the legal structure of
public limited in its working.
Public sector organisation: It refers to the company which are owned by the
government of the country. These type of organisation are controlled by the the government and
do not have the purpose of earning the profit (Botha, Kourie and Snyman, 2014). The income
source of such type of companies are usually through the taxes, fees an other financial transfer
from the government. The organisation used here for the assignment is CPS ( Crown Prosecution
Services).
Purpose:
The purpose of this organisation is to provide justice to the society by prosecuting the criminal
cases that are investigated by the police so in order to provide security to the people.
Type of public organisation:
 Central Government: It refers to the political authority that govern the entire nation.
The rules and regulation for the country is framed by the central government.
 State Government: It refers to the government body which is responsible for making
rules and regulations for the state. These type of government is responsible for fulfilling
the local needs and problem of particular state.
 Legal structure: The main purpose of CPS is for the security of people and is working
under legal framework of Prosecution of Offence act. 1985 and Police Powers and
Criminal Evidence Act, 1984.
Voluntary sector Organisation: It refers to those type of organisation whose main
purpose is to provide benefit for the society. It is often known by the name of not for profit
sector. The organisation which is used here for the assignment is Oxfam (Cairncross, 2014).
Purpose: The main purpose of this organisation is for the welfare of poor people so to remove
poverty from the nation.
Types of voluntary organisations:
 Trust: It refers to the firm that comprises of a persons that hold property as nominal
owner and has a right to control the administration of a particular sector.
 Charity: It refers to an organisation that raise money in order to help the local people.
Legal structure:

The structure followed by the Oxfam is charity legal structure.
P2 Sizes and Scope of different type of organisations
Private organisation: John Lewis and Partners
Background details: It was founded by John Lewis in the year 1864 having the headquarter in
London, UK.
Product: It deals in various product like clothing, food products, home products, banking and
financial services and many more.
Size: At present it is having 51 stores and employing around 38,100 employees in its operations
thus can be said that the size of John Lewis is very large.
Scope: The company is operating all over the UK and also in other countries too..
Mission and Vision: The mission of John Lewis is to provide best quality of product and
services to the people all over the world (Cavusgil and et. al., 2014). There vision is to keep their
employees happy and satisfied so that the company is able to enhance its position.
Objective:The main objective of John Lewis is to make maximum profit by its operation so as to
achieve sustainability in the long run.
Organisational structure: The company is properly managed by its board of directors. They
are controlled by the chairman and chief executive.
Stakeholders: This includes management team, directors, employees and many more.
Public organisation: Crown prosecution services
Background details: The company was formed in the year 1986 and is having the headquarter
in France, London.
Product: It provide judicial services all over the UK.
Size: The number of employees which are working in this organisation is around 6000 and the
annual budget of the company according to data of 2012-2013 is £592 million
Scope: The operations are carried all over the UK.
Mission and Vision: The vision of CPS is to make a positive atmosphere in the organisation
through the unified justice system (Charter, 2017). The mission is to deliver right prosecution
against the right case.
Objective:Their main objective is make the country full of security.

Organisational structure: Though the headquarter of CPS is in London and York, it sets some
of the policies and handles all the corporate matters. The director is helped by the chief executive
of the organisation.
Stakeholders: It includes government, management of the organisation, employees and many
more.
Voluntary organisation: Oxfam
Background details: It was founded in Britain in the year 1942 with having 20 charitable trust.
Product:These organisation provide basic amenities like food, clothing and shelter to the needy
people (Cohen and Kietzmann, 2014).
Size: Oxfam size is large as it is formed with 20 charitable trust.
Scope:The company undergoing its operation in UK.
Mission and Vision: Firm is developed with the mission of providing basic requirement to the
poor people. The vision of Oxfam is to provide the world without poverty.
Objective: to provide help to the needy people so that they are able to survive easily.
Organisational structure: The structure followed by Oxfam in their working is that the main
control is over the single person that is a chairwoman who is responsible for taking the decision
the decision in the company.
Stakeholders: This includes government, volunteers and many other.
TASK 2
P3 The relationship between different organisational functions and how they link to
organisational objectives and structure.
There are different department in the organisation. All these department are interlinked
with each other. John Lewis Partners is a private organisation having large number of employees
working in different department. Company cannot be handle with a single department and so for
the effective working the organisation is divided into several department. Below is the
interrelationship between the different department:
 Marketing Department and Finance Department: Both this department of John Lewis
partner are interlinked with each other (Dima, Grabara and Modrak, 2014). The main
work of marketing department is to carry out certain activities that helps in promotion of
the company that includes advertisement and many other activities. For carrying this

efficiently the department need some funds . This requirement is fulfilled with the help of
finance department. Thus there exist a connection between both the department which is
helpful in growth of the business.
 Production department and finance Department: The work of the production
department of John Lewis is to make sure that company is having the stock available so
that in case of any need it can provide to the supplier (Erasmus, Strydom and Rudansky-
Kloppers, 2016). For production, company need various raw material, equipment and all
these resources need funds. The need of fund can be easily fulfilled by the finance
department as they are always available with the funds and provide the same when
required by any department.
 Marketing department and production department: Both these department of John
Lewis contribute to the success of an organisation. The work of marketing department is
to identify needs and wants of customers. After analysing the need they contact to the
production department for manufacturing the products according to the desired
requirement.
 Sales department and finance department: These two departments of John Lewis are
interlinked with each other. The work of sales department is to sale the manufactured
product of the company. Selling of the product will generate some of the fund which is
then transferred to the finance department. The work of finance department is to make
proper distribution of resources of the company among all the departments. This will
help in effective running of all the department.
Thus it can be concluded that every department is link with other in one or other form
and plays crucial role in the success and failure of organisation. For achieving the success,
effective must is very important as it is the way by which departments come to know about the
need of each other (Georgescu and Popescul, 2015). If there is no effective coordination, there is
chance of miscommunication between the department which can sometimes lead to the failure of
the operations.

TASK 3
P4Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples.
Macro environment basically includes the positive and negative factors such as political,
economic, social, technology, environment and legal that affects the business environment.
Political factor: It includes government policies, political stability, corruption, tax
policies, labour law and trade restrictions that affects the business environment of John lewis in
positive and negative aspect. Positive effect: John lewis is UK's company, it can extend the shares by entering into new
markets because of less trade restrictions and limitations of the government.
 Negative effect: The government raised taxation policies and revenues which leads to the
negative impact for the company in terms of less profit generation because of taxation.
Economic factor: It includes exchange rates, economic growth, interest rates,
unemployment rates and disposable income that affects an organization (Glova, Sabol and Vajda,
2014). Positive effect: The government of UK is offering jobs to unemployed people to provide
them employment, which in turns helps John Lewis to increase its operations because of
more labour opportunities.
 Negative effect: The buying capacity of John Lewis consumer decreases because the
weighted prices of goods is raised by the government. which showed a negative impact
on the profitability ratio of the company.
Social factor: This includes growth rate, age distribution, career attitudes, safety
emphasis, health consciousness, lifestyle attitudes and cultural barriers which draws positive and
negative impact on the business. Positive effect: The rising population and growth of the economy is positively affecting
John Lewis in discovering new products and services by acknowledging the taste and
preference of consumers this will help the company to expand its market and profit.
 Negative impact: The cultural barriers of society will impose a negative impact on John
lewis because it is not easy for the people to accept the different culture soon. The
individuals have various perspectives regarding the product and services provided by the
company which can affect the companies growth and profit shares (Kolk, 2016).

Technology factor :This factor includes technology incentives, level of innovation,
automation, technological changes, R&D activity and technological awareness. The more
innovation in technology of the company leads to good reputation in the market. Positive effect: The technological factor of John Lewis draws a positive impact for the
growth opportunities by introducing online shopping. R&D of the company helps in
segmenting the demand and taste of the individuals.
 Negative effect: The improper use of effective promotional tools such as social media
can negatively affect the company because in the emerging era advertising is used as the
basic tool for promote the products to retain the consumers.
Environment factor: The environmental factor is consist of weather, climate,
environmental policies, climate changes that affects John Lewis. Positive effect: John Lewis adopts sustainable practices such as proper inventory
management which reduces the wastage of resources it positively impacts the
environment.
 negative effect: the company uses non-recyclable Plastic begs for Products packaging,
this draws a negative impact of the company in the economy (Quinlan and et. al., 2019).
Legal factor: It includes discrimination laws, employment laws, antitrust laws, consumer
protection laws and health and safety laws. Positive effect: John Lewis provide health and safety measures to the employees
working under the company.
 Negative effect: Discrimination among the same post employees regarding the wages and
incentives leads to the negative impact for the company.
PESTEL analysis of Marks and Spencer
 Political:This factor is explains about instability that is caused by changes in political
changes, government rules and regulation and many more.
Positive:If Marks and Spencer adopt political changes appropriately, that it will help
them to run their business in effective manner without interference of government.
Negative:Due to expansion of store in different location in different countries, it becomes
difficult for respective organisation to adopted changes in proper manner.
 Economic:It is define as those factors of macro environment which describes about
changes in exchange rate, interest rate and others.

Positive:If the respective organisation adopt themselves according to the changes in the
economy, they it will be easy for them to do transaction and perform other business activities in
effective manner.
Negative:If Marks and Spencer avoid the changes that occur in the economy, then it will
difficult for them to perform their transaction across the world which can affect their sales as
well as profits.
 Social:It is refereed to societies and communities which is an important source for the
company which help them in their growth and development.
Positive:Marks and Spencer takes into concern communities and societies so that it will
be easy for them to determine their taste and preferences. This aid them to produce goods
accordingly.
Negative:Neglecting social factors which affect respective company sales and profits due
to which they wont be able to sustain in the competitive marketplace for long duration.
 Technological:It is one important factor organisation due to which they are able to
improve quality of their product and services.
Positive:Marks and Spencer make effective use of advance technology which help them
to modify their strategies as well as improve quality of goods and services.
Negative:Making use of outdated technology and not adding extra value to it will affect
customer base of respective organisation.
 Environmental:It is important for organisation to adopt environment while production of
goods and services.
Positive:If Marks and Spencer adopt environmental laws in effective and better manner,
that it will help them to produce such goods which will not cause any harm to their customers.
Negative:Applying environmental laws will cause respective company high cost of
production which can affect their quality of products.
 Legal:It is essential for organisation to adopt legal laws in order to run their business in
legal manner.
Positive:Respective organisation adopt legal laws properly which aid them to run their
business across the world in legal manner.
Negative:Not adopting legal laws will affect the goodwill of respective company due to
which they can be downfall in their position at competitive marketplace.

TASK 4
P5 Internal strength, weakness, opportunities and Threat of John Lewis
In order to analyse both internal as well as external factors SWOT analysis is done by
John Lewis. The analysis is done in order to know about the strength and weakness and
opportunities and threat of an organisation. SWOT analysis of John Lewis is below:
Strength
 It is one of the most famous retail
market in UK which is dealing in
product range like clothing, food
products, financial services and many
more (Saleem, 2015).
 John Lewis is offering the service of
online shopping that enables the
customers to buy any product at any
place and also provides the facility of
international delivery.
 The company is employing more than
3500 employees that shows that John
Lewis effectively played in providing
the job opportunities to the people.
Weaknesses
 The product offered by John Lewis has
high price as compared to other
supermarket available in the country.
 In order to compete in the market with
other competitors , John Lewis started
cutting the price of its product which
results in decreasing the value of its
brand.
 The range of product is less as
compared to other rivals present in the
country.
Opportunities
 Upgrading in the clothing sector can
prove to be the biggest opportunity fro
the company as by the way they are
able to attract youth over the product
(Schaltegger, Hansen and Lüdeke-
Freund, 2016).
 By using new selling strategies
company is able to capture the large
market area.
Threat
 Large number of competitors are
available in the market which is dealing
with similar type of product and it is
one of the biggest threat for the
company.
 John Lewis has faced failure in
operation in other market due to the
cultural difference of people over their.

SWOT analysis of Marks and Spencer:
Strength Weakness
 Respective company has a strong brand
image which help them to attract
customers.
 Marks and Spencer has a strong global
presence which aid them to reach wide
range of customers through which they
are able to aware them about their
product and services.
 It has a poor sustainability of supply
chain due to which they are not able to
transport goods and services at their
store which are located at different
location.
Opportunities Threat
 As fashion is an evolving business
which assist the respective organisation
to produce products as per latest trend
and fashion. This help them to meet
customer taste and preferences.
 There are large number of competitors
of Marks and Spencer which is one of
the biggest threat for the company. Due
to this their sales and profits gets
affected.
P6 Interrelation of strengths and weaknesses with external macro factors.
The strength and weakness of John Lewis has interlink with the external macro environment
which is discussed below:
 Political factors: This include the interference of government regulations that has a
impact on the working of an organisation.
Strength: John Lewis is following each and every regulations of UK as the economic stability
of UK is the biggest strength of the company thus it is the strength for the company (Shenkar,
Luo and Chi, 2014).
Weakness: As government regulations are changing very frequently thus it is not possible for
John Lewis to follow such regulations always thus is weakness for an organisation
Technological factors: This include the innovation which result in development of good and
services as per the technology.

Strength: John Lewis is using the latest technology for producing the product and it is the
greatest strength of the company as by this it is able to acquire the attention of large number of
youths.
Weakness: Many competitors are using the similar type of technology and providing similar
products and also at the cheap rate is one of the weakness of John Lewis.
 Social factors: Factors include here are age, gender ratio, population growth, urban-rural
divide, employment rates, health status of selected population (Wheelen and et. al.,
2017).
Strength: John Lewis is providing wide range of product for all the age group thus satisfying the
need of every group of people. Thus it works as a strength for the company.
Weakness: It include the changes in taste and preference of the customers and it is not always
possible for John Lewis to work with peoples preference. Thus plays a negative role in
operations of the organisation.
CONCLUSION
From the above mentioned report it can be concluded that there are different type of
organisation with different structure and objective. Every organisation has so many department
that functions differently in context to the company. Coordination and communication is very
important for the company to perform the task assigned Thus helps in smooth running of the
organisation. Internal and external factors of business environment plays a crucial in company
as they provides opportunity to managers of firm for achieving organisational growth.

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