Relationship between Organizational Functions and Company Objectives

This report analyzes the relationship between various organizational functions and their linkage with company objectives. It explores how different departments contribute to achieving company goals and objectives. The report also discusses the positive and negative impact of the macro environment on Tesco, one of the largest retailer brands in the UK.

BUSINESS
ENVIRONMENT

Table of Content
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
P1 Various types and purposes of organizations.........................................................................1
P2 Size and scope of various organizations.................................................................................3
LO2..................................................................................................................................................4
P3 Relationship between various organizational functions and their linkage with company
objectives.....................................................................................................................................4
LO3..................................................................................................................................................6
P4 Positive and Negative Impact of the Macro Environment on Tesco......................................6
LO4..................................................................................................................................................8
P5 Internal and External Analysis of Tesco.................................................................................8
P6 Relation between external macro factors, organizational weaknesses and strengths ..........10
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment can be understood as one of the most highly dynamically working
aspect within world scenario where there are various companies working within world
parameters to bring on continuous new synergy of evolution and potentiality enrichment among
employees. The report analyses how various aspects such as size, scope and functional goals
enable to build new working enhanced culture to network onto larger paradigms which enable to
generate long term viable position factors within competitive business world. Tesco is one of the
biggest retailer brand within UK industry having wide portfolio of innovative products and
services to enrich wide advancement within goodwill of customers market share. The report
further discusses positive and negative impact macro environment has within business
operations, analysis of internal and external parameters to identify the strengths and weaknesses
within business scenario. Report also analyses factors of interrelationship between strengths and
weakness within external business macro factors for Tesco to build on higher innovation,
functionalist strength to enter into untapped business segments and to regulate larger paradigms
of business functionality (Krishnamoorthi and Mathew, 2018)
LO1
Various types and purposes of organizations
There are a number of organizations coming up within dynamic business world for
various productive functional strength factors and to bring on new advancement factors within
company businesses pertaining to bring on competitive world paradigms.
Private sector organisations: Sole traders: The sole traders are firms which are operating their own new business
setups and develop new end goals focused to bring on wide innovation within various
marketing paradigms to enter into competitive business targets. Partnerships: It can be understood as business where company is formulated with
partnership among 2 or more business where they in combination formulate new end
market synergy and determine various competitive goals for technically exploring work
opportunities.
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 Private limited companies: These are private firms where shareholders contribute their
capital, time and energy for bringing on various competitive rational services for
gaining new productive consumer goodwill. Public Limited companies: The public limited companies are open for trading for
various public through which higher promotional segments shall be explored and
wider technical advancement shall be explored.
Private sector organisations
 Public company can be understood as wide upscale organizations where ownership is
organized by various number of shares of stock which are freely traded within exchange
and also hold large proportion of functional strength within their business scenario to
pool on new resources for effective utilization. The public companies are generally large
with varied customers market share reach and viable position within share market as on
to get optimum high class capital funds by people who invest in buying company shares.
Purpose of public company is to bring on innovation within production levels and pool on
new determinants and resources for gaining stronger quality standards within outputs and
goodwill within customers worldwide (Koth, 2019). Public companies are known to be
one of the major component and part of global business scenario where investment
potentialities are huge as high number of shareholders are there but public companies do
not hold any opportunity for shareholders to take any decisions as the trade market holds
wider. Example- Tesco is known as one of the biggest public company whose are traded
within stick market and has high goodwill and developed working potentiality among
consumers goodwill development.
 Private companies on other hand are organizations who work solely with innovation
business practices and shares are not traded within open trading market share but only
limited people can buy the private company shares to potentially be an active part among
shareholders. The private companies work with goal to take on new business paradigms'
aspect where marketing and promotion investment potentialities are huge pertaining onto
the set competitive paradigms within business world (Koshesh and Jafari, 2019).Private
companies build new patterns of discussion for shareholders as they are an active group
for enabling larger level of discussion and rather fathoming functional structure to bring
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on wider scale services. The purpose of private company is to able to construct wider
scale productivity and functional efficiency among all products for higher technical
advancement, keen synergy of dynamic innovation for gaining new profitability
scenarios. Example- Arcadia group of companies is private companies example which
holds the expertise of innovation and high scale investment funnel into business
development with wide capital factors with high scale potentialities factors and
paradigms to bring on wider scale services with building new channels of innovation
within quality factors.
 Voluntary companies on other hand are working with non-profit goals and business goals
to bring on wider scale changes among business world for ethical services patterns, keen
development within business scenario and to develop long term synergy of innovation for
benefiting people . The voluntary companies are known for gaining stronger positions
paradigms of business with non-profit goals, no trading of share and the purpose to bring
on new changes through which customers market share can be befitted. Voluntary
companies are relatively smaller in structure as compared to public and private
companies which also limits their potentialities to reach consumers (Kasim, Haracic, and
Haracic, 2018). The Cancer research UK is an example of voluntary organization where
company works with non-profit working fundamentals and for providing better effective
treatments at less cost factor.
P2 Size and scope of various organizations
Organisations differ from each other based on size and scope with varied functional
patterns and determinants to bring on new development patterns within global scenario and to
work with detailed advancement for higher profitability of goals. Thee private , public and
voluntary companies separate from each other which can be analysed based on size, scope and
functional channels (Khalid and Rahman, 2019).
MICRO COMPANIES: The micro enterprise are generally known as various small
companies and enterprises employing nine or few people and having limited balance sheet
or turnover within the vivid business scenario.
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Small and medium sized companies: These are little large in sixe than the micro companies
where employees are large in size and also the operations are widely different as analysed
in comparison with small companies.
 The size and scope of public companies are wide as they hold the opportunity of public
shares trading within customers market share globally and also there are large level of
investment opportunities to bring on expansion into untapped business segments. The
scope of business goodwill and profitability is wide for public companies as there is high
potentiality for expansion, diversification within business activities , products and
services. For example Tesco is public limited company which has wide scope of business
development and technical advancement among its services and factors of production
standards which also holds the opportunity for people to invest in shares. Tesco shares
openly traded within stock market through which high goodwill is there of brand within
world scenario (Büyüközkan and Ilıcak, 2019). The size of public company is wide
which can be analysed with the factors that shares are openly traded within stock market
which gives public the opportunity to invest theior capital as per the set paradigms of
functional strength, goodwill of services and products. Scope of public companies is wide
for further diversification within business scenario due to large capital holdings and huge
investment potentiality to build on new segmented channels of effective communication
among consumers market share.
 The size and scope of private companies are wide as the innovation is strongly focused
within production, marketing functions and shareholders are limited which also explains
that shares are not traded within open trade stock markets. The shareholders are able to
take active participation within company business decisions, where integrity of all
functionality in decisions taken by private companies are exploration enriched for gaining
competitive and dynamically focused to bring on wide innovation within business
scenario. Private companies are wide in business operations within world scenario where
advancement within products and services are huge ad also the use of innovation is huge
to bring on dynamic changes within world business competitive levels. Scope of private
companies is widely understood as highly limited as compared to public companies as
people can actively take part within the shares traded in stock market.
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 The size and definite scope of voluntary companies is limited and small in term, of
financial functionality where it can be seen that business operations are not technology
inclusive with limited potentialities to bring on advancement (Belas and et.al., 2019). The
scope of voluntary company is limited as there are the least capital factors involved
within business operations and services are pertained onto the goal to bring on new
development factors through which betterment of people can be attained. Size of
voluntary company is small as comparatively to public or private companies which limits
its growth potentiality into new untapped countries market. As less business goals of
expansion and diversification are there within voluntary companies business scenario, the
scope and size is limited to reach higher scale of customers and to promote innovation
fundamentals effectively. Voluntary companies work for the sole betterment of public in
genera by developing new positive working standards, higher synergy of efficiency and
to program the factors based on social life betterment. The purpose of the organization is
not to earn profit from the market share consumers, but to use the profit to make more
people aware about the various rights and educate them so that they can stand up for
themselves in the world.
LO2
Relationship between various organizational functions and their linkage with company
objectives
The relationships between company function and their wide linkage with Tesco company
objectives can be understood with the wide potentialities of effective decisions which are taken
by the top management for effective quality output generation. Tesco bieng one of the biggest
retailer company within UK industry holds wider scale opportunities and determinants ad
working potentialities within functions of various departments which are linked with company
objectives to attain stronger performance metrics, the best quality of outputs and higher
profitability among consumers competitive market growth factors (Baporikar, 2020).
 The marketing and promotion department is correlated and related to finance departments
where goal is to strategically develop effective marketing objectives with the best
investment parameters of funds to pool in innovation and advancement of new
technology neds for effective promotional services. The linkage of this with company
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objectives can be understood with wide potentialities finance and marketing department
gaols bring on the synergy of innovation functionality for tesco to enter into untapped
countries business segments. Tesco marketing departments functions are connected with
finance department objectives where marketing is done to develop higher innovation
friendly customer market share and invest with the best financial decisions to pertain onto
stringent dynamic business demands of innovation.
 The Human resource department is highly correlated to bring on best skilled human
resources who are talented, knowledgable and experienced within practical fundamentals
to pool on best working strength within all functional departments. HR department is
interlinked with all other departments whose goals are correlated such as with marketing ,
research and production department for recruitment , selection strategies which are based
on keen development requirements and perspective goals within Tesco. This enables
company to frame the best HR policies as discussed within departments and to leverage
on best skilled workforce (Alotaibi and Liu, 2017). The research and technology department within Tesco are correlated with the production
department goals where it enables to bring on the best innovation channels and paradigms
of pertaining onto the latest competitive factors of marketing which will enable to gain
higher profitability. Research and development departments makes all investments plans
to brig on new machinery as per changing viable metrics and functional communication
with production department enables to bring on best paradigms of effective technical
development. Tesco has the profitability goals marked to bring on keen synergy of
innovation, leverage of high dynamic working standard within production department to
brig on best working motivation among employees. Advantages: The advantages of this interrelationship within Tesco department functions
can be understood by the factors where the correlation not only increases work efficiency
for brand development onto new roles but also there is higher functional advancement t
brig on positive synergy of higher profitability and consumer market goodwill.
Advantages can be also analysed with the fact that dynamic business scenario is enabled
and development is strongly focused to brig on new investment funnels. Tesco working
potentialities are developed pertaining onto new changing business demands and
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functional strength formulated for gaining new synergy of large cooperative working
standards.
 Disadvantages: The disadvantages are that majorly there may be chances of
interferences within departments goals, where Tesco may widely not be able to make the
productivity increase which may further impact demands and needs of the customers will
not be met from time to time which is a very important factor for them. This will weaken
the more competitive advantage which Tesco works within the market and the bond in all
organizations will fail. There will be communication gap and the functioning in
organization will reduce is proper investment in innovation information channe4ls are not
built for regulation the worming standards (Alaloul, Liew and Zawawi, 2017).
LO3
P4 Positive and Negative Impact of the Macro Environment on Tesco
The macro environment within which a company operates in can have various factors
that can have a negative or positive impact on the business's operations and performance in its
operational industries. The macro environment of retail industries of UK in which Tesco operates
in, can be effectively analysed by conducting a PESTLE analysis for the operations of Tesco.
PESTLE analysis is a strategic framework through which the various external political,
economical, technological social, environmental, legal and factors, that are present in the macro
environment, which can have an impact on a business organisation's efficiency, performance,
productivity and financial metrics can be effectively identified and analysed (Perera, 2017). The
macro environment factors that influence the operations of Tesco are as follows: Political Factors: Though there are numerous political factors that can have a significant
impact on the operational productivity and profitability of Tesco, the most significant
political factor that is present in the retail macro environments is of Brexit. The current
political instability in UK, due to Brexit has significant influence on the operations of
Tesco within the retail markets of UK. Though the details of alterations to government
laws and regulations still haven't been public and are undergoing examinations, Brexit
can have a beneficial influence on the operations of Tesco as it would result in the
switching of the international trading laws, which currently are immensely complex and
opaque in favour of trading laws which are less complex and more transparent. This
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would effectively results in an increase in the performance and efficiency with which
Tesco conducts its international trading operations, resulting in increased profitability for
Tesco. Economical Factors: Recently, the UK government has announced a reduction in the
amount of corporate tax that is charged on the overall profits of a business organisation
from 19% to 18%, from April 2020 onwards. This means that Tesco would now have to
pay the government of UK less amount of corporate tax on the same amounts of profits
generated as they did in their previous fiscal year, resulting in increased profitability for
the retail operations of Tesco (Rastogi and Trivedi, 2016). This will surely have a
positive influence on the operations of Tesco as they can effectively increase the amounts
of profits generated, even if they service the same number of customers as they did in
their previous fiscal year. Social Factors: The most prevalent social factor that is present within the external
environment in which Tesco operates in relates to the social trend of customers within the
retail industries of UK choosing to increasingly conduct their shopping and retail
operations through online stores, instead of visiting the physical establishments of retail
stores based on the convenience and ease of conducting retail operations online. This
social trend can have an immensely positive impact on the productivity, profitability,
customer base and market share of Tesco as through its online retail stores, Tesco now
has the opportunity to service and satisfy the needs and requirements of a very large base
of consumers and capture the online retail market. Technological Factors: Technological factors present in the macro environments, also
have a significant impact on the operations of Tesco within the retail markets of UK.
Technological factors possess the potential to have both positive and negative impact on
the operations of Tesco. Tesco has the opportunity to effectively increase its operational
efficiency, performance, profitability and productivity and within the retail markets of
UK by installing new and innovative manufacturing technological equipment present in
the markets, which is capable of performing at increased performance and efficiency
while consuming less power (Khalid and Rahman, 2019). Technology can also have a
negative impact on the operations of Tesco as should they choose not to upgrade, while
their competitors upgrade their manufacturing and other operational equipments, it can
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have a negative impact on the all operational metrics of Tesco during its operations in
retail markets of UK. Legal Factors: Legal factors present within the macro environments in which Tesco
operates in can also have a significant impact on Tesco. Changes and alterations to any
government mandated policies, laws and regulations such as the minimum wages act,
health and safety at work act, employee laws etc., which Tesco is required to follow on
an organisational level, can have a significantly negative impact on the operations of
Tesco and result in decreased productivity, performance, and profitability within the
retail markets of UK.
 Environmental Factors: There exist various environment related factors within the
macro environments, that can influence the operational metrics and attributes of Tesco
within the retail markets of UK. Any kinds of changes or alterations towards the
environmental laws and regulations which are mandated by the UK government,
impacting the operations of both Tesco and their suppliers can have immensely negative
impacts on the operational productivity and profitability of Tesco. Alterations to
environmental laws can increase the Tesco supplier's prices in addition to affecting the
procurement and distribution operations of Tesco, decreasing their productivity and
profitability within the retail markets of UK.
LO4
P5 Internal and External Analysis of Tesco The micro environment within which Tesco operates in can be effectively
analysed by making use of the SWOT analysis. The SWOT analysis is a strategic
framework through which we can identify the internal strengths and weakness of Tesco
as well as the external opportunities and threats that are present to the business
organisation.
 Strength: Brand: Tesco enjoys immensely high brand awareness, value and reputation against its
competitors, within UK's retail markets, in addition to also having good corporate image
amongst consumers. Global Operations: Through operating successfully within the retail industries of UK for
such a long period of time, Tesco has had ample chances to expand and grow their
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operations to international markets (Gürel and Tat, 2017.). Tesco has now diversified its
operations to 11 distinct countries around the world. Technology: Tesco also makes effective and efficient use of new and innovative
technological solutions present in the market to increase their operational performance
and efficiency.
 Weakness: Public Relations: Though Tesco enjoys great brand awareness, their public relation
operations are effectively insufficient, with the business having been shown negatively in
public limelight in some situations. Limited Exposure: Though Tesco has effectively diversified to global markets, their
exposure is effectively limited to select few locations (Sarsby, 2016). Tesco needs to
expand the exposure of their operations in order to effectively increase their customer
base, market share, productivity and profitability in UK's retail markets.
 Opportunity: Online Stores: Changing social and customer trends within the retail industries, allow for
Tesco to significantly increase their operational productivity, profitability, customer base
and market share by effectively servicing huge number of customers through their digital
online operations. Acquisition: Tesco can acquire the operations of their competitors and add them to their
own productivity by effectively taking over other businesses within the retail markets of
UK through the process of acquisition. This would decrease the competition for Tesco
while increasing their customer base and market share.
 Threat: High Competition: The retail industries of UK are highly competitive, with significant
number of businesses operating within the industry for profits (Phadermrod, Crowder and
Wills, 2019). This intense competition is a major threat towards the operations of Tesco.
Inflation: Inflation in UK's economy will result in the purchasing power of the retail customers
to decrease. This would have immensely negative impact on the profitability and productivity of
Tesco.
P6 Relation between external macro factors, organizational weaknesses and strengths
The strengths, weakness, opportunities and threats are also interrelated with each other. This
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can be demonstrated by TOWS matrix for Tesco:
Opportunity:
 Growth through
acquisitions
 Increased market
shares and productivity
by use of technology.
Threat:
 Inflation
 High competition
Strength:
 Good brand value
across globe
 Effective use of
technology
SO strategies:
The good brand value of
Tesco can help to easily enter
into new markets. For this
purpose, company can use
strategies like acquisition. It
will further enhance the
exposure of the organisation
and can eliminate the
weakness of company.
ST strategies:
The fierce price based
competition can affect the
sales and market positioning
of the company. However, by
increasing the use of
technology company can
make proper pricing decisions
and can withheld its superior
position in the price war.
Weakness:
 Limited exposure
 Less efficient public
relations
WO strategies:
Tesco has limited exposure
but its good brand value can
make it easy to improve its
public relation as well as to
grow in new potential market.
For this company must
emphasis on using strategies
like acquisition, merger and
digital technology.
WT strategies:
At present public relations of
Tesco are not good as
compare to its other
competitors. This aspect can
worsen the competitive
position of the company.
Hence to overcome the threats
due to price wars or
competition organisation must
eliminate its weakness in
terms of public relation.
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 The limitations and capabilities of Tesco are strongly influenced by the external
macro factors affecting business. One of the strongest macro factor which has been
controlling retail industry from last few years is digital or online technology based
services (Gaganis, Pasiouras and Voulgari, 2019). Tesco has successfully adopted this
change and thus its online services and adaptation of the latest technology has been one
of its strength. Without aligning the technological impact on operational services it can be
impossible for the organization to enhance its attractive or brand strengthening attributes.
It can also act as weakness for Tesco. For instance, if Tesco does not pay attention to
secure technological services then it can have negative impact on customer decision and
perception.
 Thus in such circumstances poor customer perception and loyalty can act as considerable
barrier to gain competitive benefit. Limited public exposure and relation are also crucial
weaknesses of the company. Tesco faces fierce completion from the other service
providers such as Asda, Lidl and Sainsbury. One of the reason which influence the
competitive positioning is public relation which act as limitation or weakness of Tesco.
The macro factors such as legal or environmental attributes can play the role of
controllers in it. For instance, when organization fails to meet legislative considerations
particularly those related to employee wellbeing and safety then it has adverse impact on
organization. As a result, declining support and trust of customers can act as major weak
aspect of the company. Without faith and trust it is challenging for the company to retain
talented human resources as well as loyal customers.
 Climate change concerns are emerging as the latest trend in the macro environment
analysis. Most of the retailers are paying attention to the sustainable packaging and waste
reduction operations so that operational cost can be reduced and environmental
sustainability can be linked with the business strategy. Associating environmental factors
wisely in the operational plan can act as emerging strength for the organization. For
example, for managing waste Tesco not only contributes to environment but also to
proper utilization of the organizational resources. It lowers the operational cost and
enhances the operational efficiencies. The effective operational management can be one
of the strengthening feature of the company to improve its supply chain management and
enhance the profitability margins by lowering resource waste.
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 The improved supply and operational management practices ensure that delivery services
of the organization are excellent in terms of attracting customers and securing better
market positioning. Apart from the promotional strategy and long term business
advancements it is the quality of product and timely delivery of the services which is
ultimate strength of the brand (Hamilton and Webster, 2018). This can be achieved only
when Tesco analyses the significance and changing trends of environment sustainability.
Another dominating factor which drives the success of Tesco is its pricing strategy.
Organization offers very low prices so that customers can be retained and it can achieve
success. However, this strength is controlled by the economic factors such as inflation or
average income of targeted customers. From these findings it can be stated that internal
capabilities can be fully explored when they are able meet the macro environmental
changes. It also helps to identify the suitable action for overcoming the weakness of the
organization and to enhances its success and positioning in the market.
CONCLUSION
It can be concluded from the above report that organizational success is significantly
affected by the complexity of business structure and dependency of different functional units on
each other. It has been also analyzed that when organizations have good functional relationships
then they are able to achieve their operational goals in more efficient ways. It has been also
evaluated that for successfully implementing business strategies both internal and external
environment must be analyzed for making suitable decisions and to gain competitive advantage.
The macro factors also affect the decision making and long term objectives of the business. Thus
it can be concluded that an appropriate analysis of macro and internal factors is mandatory. It is
closely related to capabilities and limitations of the organization. Thus better understanding can
deliver the more productive business outcomes.
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