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Understanding Business Environment | Study

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Added on  2019-12-03

Understanding Business Environment | Study

   Added on 2019-12-03

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TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1LO1 UNDERSTAND THE ORGANIZATIONAL PURPOSES OF BUSINESSES.....................11.1 Objectives of different types of organization........................................................................11.2 Extent to which objectives are met........................................................................................11.3 Responsibilities of organization and strategies employed to achieve them..........................2LO 2 UNDERSTAND THE NATURE OF THE NATIONAL ENVIRONMENT IN WHICHBUSINESSES OPERATE...............................................................................................................32.1 Describe how economic systems attempt to allocate resources............................................32.2 Impact of fiscal and monetary policies on company and their activities...............................32.3 Analysing the impact of competition policy and other regulatory mechanisms on thebusiness activities........................................................................................................................4LO 3 UNDERSTAND THE BEHAVIOUR OF ORGANIZATIONS IN THEIR MARKETENVIRONMENT............................................................................................................................53.1 Describe how market structure determine the pricing and output decisions of businesses...53.2 Describe ways in which market forces shape organizational response.................................53.3 Examine how business and cultural environments shape the behaviour of company...........6LO 4 BE ABLE TO ASSESS THE SIGNIFICANCE OF THE GLOBAL FACTORS THATSHAPE NATIONAL BUSINESS...................................................................................................74.1 Importance of international trade...........................................................................................74.2 Impact of global factors.........................................................................................................84.3 Impact of policies of European Union...................................................................................8CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
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INTRODUCTION Business environment is composed of two types of terms that are “Business” and“Environment”. This phenomenon is a set of controllable and uncontrollable factors whichaffects the business activities of an organization. The purpose of this report is to scan theenvironment around which the company operates. It will help in developing a broadunderstanding about the economic, cultural, social and regulatory environment affecting thebusiness. For this purpose British Airways has been selected which operates under the aviationindustry. LO1 UNDERSTAND THE ORGANIZATIONAL PURPOSES OFBUSINESSES1.1 Objectives of different types of organization There are different types of organizations and they are mainly divided into three sectorssuch a public, private and voluntary. The purposes for all them are different. British Airways is aprivate organization having a mission of offering top quality aviation services for the customers.The mission statement explains the reason behind establishment of the organization and visionstatement reflects the ultimate goal of the company (Ahmed, 2012). For British Airways,innovation, creativity and customer loyalty are the most top priorities. The company aims todeliver world class flying experience for the passengers. In the present context it holds the visionof reducing the environmental burden under which it has set an objective of decreasing theClimate Change Emission by 2020. The short term and long term objective of the BA is toconstantly work on improving the flight experience of the customers so that brand loyalty can beenhanced (Dickinson, 2010). 1.2 Extent to which objectives are metIt is to be noted that stakeholders are the people who are directly or indirectly associatedwith the business. They are interested in the business affairs of the company. It is important forthe BA to satisfy all the wants of its stakeholders (Fernando, 2011). The primary stakeholders ofthe BA includes customers, employees, employees, tax authorities, government, regulatorybodies, suppliers etc. 1
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Shareholders – Shareholders associated with the organization are satisfied as they aregetting adequate rate of dividend every year. They expect high rate of return on the shareswhich they have investedEmployees – These people expect that company should offer them various opportunitiesrelated to the growth, development and career. They have the power to influence thecustomers (Jones and Scott, 2011)Customers – They expect a top quality flight experience from BA. Efforts are made fromthe side of the company to offer very comfortable and flexible customer services. Government – Government keeps a close eye on the business practices of BritishAirways so that it does not get indulged in wrong doings. The regulatory bodies wants thecompany to follow all the rules and regulations related to the aviation industry in UK.Tax authorities – These bodies’ wants that BA should make timely payment of all thebusiness taxes and duties. It helps in creating a good image and reputation for thecompany within the society (Leon and Garcia, 2011). 1.3 Responsibilities of organization and strategies employed to achieve them British Airway fulfil all its responsibilities and duties towards its shareholders in positivemanner. It can be described in the following manner. Customers – Organization emphasize on retaining the existing customers and also workon gaining the new segment of customers (Riddle and Ayyagari, 2010). Employees – Employees within BA are having the power to influence the customers.Hence it is important for the company to keep its employees satisfied in terms of training,remuneration, working conditions and services. Shareholders – In order to satisfy the shareholders, BA identifies the key strengths andweaknesses in a client’s CR program (Wright, Marston and McDonald, 2011). Thisdevelops trust among their clients and strengthens the relations with the shareholders.These people are involved in the decision making process related to matters suchchanging a board member or adopting new strategies. Media – Media has a great impact on the business practices of the company in case ofany kind of controversies. British Airways is making efforts to be imagined as a goodcorporate entity through reducing the carbon footprint. 2
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