Business Strategy & Management Control Systems

This assignment examines the relationship between business strategy and management control systems, drawing insights from various academic sources. Key topics include the effect of strategy on control systems in Malaysian hotels, corporate-NGO collaboration for developing markets, and enhancing students' employability through business simulation. The assignment also touches upon broadband networks, exports, ownership, and firm performance in different business environments.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
P1 Types and Purpose of Organisation.......................................................................................1
P2 Size and Scope of Different Organisation.............................................................................2
TASK 2............................................................................................................................................4
P3 Relationship between different organisational functions and its link with organisation
objectives ....................................................................................................................................4
TASK 3 ...........................................................................................................................................5
P4 Positive and negative impact of Macro environment on Business operations.......................5
TASK 4............................................................................................................................................7
P5 Internal and External analysis of Walmart.............................................................................7
P6 Interrelation of Strength and weakness with external Macro factors....................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment can be defined as collection of individual , firms and and many
other factors that may or my not under the control of the organisation. These factors have an
effect on profitability, growth and survival of organisation. There are so many types of
organisation which operates in different types of environment as the activities that are performed
in the companies are different (Agarwal, Grassl, and Pahl, 2012). It is considered as an effective
part of business management. It is considered as a combination of internal and external factors
that handles the operating activities of the company. The company that has been referred here is
Walmart. It is world's largest multinational retail corporation that operates as a chain of
hypermarkets , supermarkets, discount department stores etc. this report will discuss about the its
size and scope, their market structure, impact of external and internal environment factors on
business environment of Walmart and internal strengths and weaknesses of company and its
interrelationship with external macro factors.
TASK 1
P1 Types and Purpose of Organisation
Each organisation is having different types of purposes and goals that they aim to achieve
while establishing themselves in the market. There are types of firms that operates just to earn
profits by performing various functions and there are other firms too that tries to meet the
requirements of the customers by getting to know their needs and demands. Therefore, it can be
said that the intentions of all the companies are not same. There are different types of
organisations that are existing in the market namely; Private organisation, Public Organization
and Voluntary organisations. The types and purposes of business organisation are -
 Public Organisations- These types of organisation is owned and controlled by central
government as well as Local government. This is considered as a pert of economy which
provides various types of government services. This sector plays an important role in
achieving the goals and objectives of the organisations associated with it. In UK, public
sector organisations plays an indispensable role in providing employment tom large no.
of people (Aterido, Hallward-Driemeier and Pagés, 2011). Minimum no. of people to
start this company is seven and maximum is unlimited. They are having various options
to raise funds like from taxes, duties, revenues received and penalties etc. Various areas
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that are associated with this sector are Army, healthcare, agriculture, electricity etc. there
are several benefits that are given to people who are working in pubic organisations like
they are having a job security, pension facility, medical allowances etc.
 Private Organisation – It is that type of organisation that is established mainly to gain
profits from the market (Auzair, 2011). In recent years, there are various companies that
are expanding globally at a fast space. It is that type of organisation where goods and
services are distributed by individuals and it is not considered as a part if any
organisation. These types of companies are allowed to issue shares and have
shareholders but these shares are not traded in public exchanges are are not issues
through an IPO.
 Voluntary Organisation – It is a type of association or a union in which the group of
individuals enters into a agreement voluntarily to achieve a common goal or objectives.
This sector basically works for the socio economic development of the country and helps
in enhancing various types of culture, art and other activities in the society. They are also
having a legal structure as they can be in the form of a trust, limited company or an
unincorporated association. Its main purpose is to work for the betterment of the society
but is it is a profit oriented company then making money is considered as their main aim.
In UK, there are so many voluntary companies but only 1800000 is registered . This
sector also helps the other organisations by improving the factors of society. They aim to
provide good quality services and products at lowest prices so that more and more people
are able to make use of these products and services.
The difference between Profit and Not-for Profit Organisation are:-
For Profit Organisation Not-For Profit Organisation
 It is a large organisation that is
operating mainly to earn profits for its
owner.
 Its source of revenue is from sale of
goods and services.
 The financial statements that are
prepared here are income statements,
Cash flow and Balance sheet.
 It is a type of organisation which is
conducting its operations just to serve
the society.
 Its source of revenue is Donations,
subscriptions, membership fees etc.
 The financial statements prepared here
are Receipts & Payments A/c, Income
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 Here, the capital is contributed by the
owner of the company only.
& Expenditure A/c and Balance sheet.
 Here, the business is started through the
donations from subscriptions.
Government grants etc.
The difference between Not for Profit and NGO are :-
Not-For Profit Organisation NGO
 It is an organisation that is set up for
providing goods and services to its
customers and have a principle that no
member will receive share profits of
the company.
 It is made under Section 8 of
Companies act, 1956.
 Its area of operation is limited.
 It is a non-government organisation that
is formed by the ordinary citizens that
operates through government.
 It can be registered under various acts
like Public Trust act, Societies
Registration act, 1860.
 Its area of operation is large.
Partnership – It is an agreement in which two or more people come together and do a business
and share the profits and losses equally. There are various types of agreement that are happening
in this type of organisation. It is normally a cooperative activity that is undertaken by various
parties like government, NPO, businesses , individuals etc.
Sole proprietorship – It is a type of business organisation in which there is a single owner of the
whole business. He only handles all the activities and take all the risks that is associated with the
business. It is the simplest form of business one can take part in.
P2 Size and Scope of Different Organisation
Since the market has become so competitive these days , so it is very much required that
the functions of the companies should be performed in a rightful manner so that the companies
grows at a fast rate. In the business environment, the organisation is divided into three categories
according to their size (Avramenko, 2012). It is segregated as Small, medium and large size
organisations. The small size organisations basically deals at the local level in the marketplace,
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medium sized organisations are related with state level and large sized organisations operates in
national as well as international market.
Some business are having only 5 members but some have more than 20000 members. It
is possible that the company can be operated by a single members also for ex designers and
beauticians are the sole owner of their business. According to size, organisations can be
classified as :-
 Private sector Organisations – It is considered as a very essential part of economy as the
it helps in generating more and more revenue by performing various functions at both
national and international level (Burns and Winter, 2011). The main aim of these
companies is to earn more profits only. The size and scope of this sector is decided on the
basis of business organisation. For ex. Marks and Spencer is a private company that is
working since 1884 in UK successfully. The size of private companies is specified as :-
◦ Minimum Members- 2
◦ Maximum Members- 50.
 Size of Marks and Spencer can be classified as :-
◦ It is having around 959 stores that is operating in UK and total 1433 in the whole
world.
◦ It is employing approx 82904 employees
◦ The company acknowledged the growth of 11% in its clothing division in UK.
 Public Sector Organisations – The size and scope of public sector organisation is decided
on the basis of type of business organisations (Cronan and et. al., 2011). The companies
that are included in this sector are developed for welfare of the society and to satisfy the
needs and demands of the customers. Nestle is a public company that is having many
joint ventures around the world . The size of public companies is described as :
 Minimum Members- 7
 Maximum members- Unlimited
 The size of Nestle can be described as :-
 It is a public company that was founded in 1866 and are producing variety of products
like baby food, coffee, dairy products, confectionery etc.
 They are employing more than 335000 employees all over.
 They are having total assets of approx 131.9 billion which speaks the size of company .
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 Voluntary Organisation – In this type of organisation, money is collected through
investors and sponsors. Age UK is a voluntary association that is registered in UK as a
charitable trust. it was formed after combining two major charitable companies namely;
Age concern and Help the Aged. It has a combined income of more than £160 million in
which £million a year is raised through funding and by performing various types of
commercial activities (Dahan and et.al., 2010).
Transactional Company – It is a type of company which is huge and is doing their operations
in various countries as well. There are so many transactional companies that are much richer than
an entire country which comes under less developed category. These companies helps in
developing the country's economy by providing them employment.
Licensing – It is a business in which a company gives permission to another company to
manufacture their good and services. All this is fixed on a specified payment. It provides various
benefits like :-
 It defines that the company is having something unique.
 They will have a better position in the market.
Franchising – It is a practice that is followed by many organisation in which a company gets to
use another firm's business model for a specific period of time. There are two parties involved in
this who are called as ' Franchiser ' and ' Franchisee '. In this, the Franchiser's success is
dependent on the success of the Franchisees.
Joint Venture – It is a type of business which is created by two or more business. Companies
chooses this type of business when they have to :-
 Access the whole new market
 Risk sharing
 Assessing the skills and capabilities
Industry – In this , the group of companies are classified on the basis of the activities they
conduct in the organisation. It is generally categorised into segments called as Sectors.
Supply – It is considered as a fundamental concept in which the total amount of specific goods
and services are supplied to the supply customers. This concept is mainly related to the buying
and selling of goods and services.
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Demand – It is an economic activity in which the companies tries to know the needs and wants
of the customers so that they can satisfies their desires . It is closely related to supply because
here the consumers always try to pay low prices but suppliers also tries to maximise the profits.
TASK 2
P3 Relationship between different organisational functions and its link with organisation
objectives
There are various types of functions that are performed in an organisation and
all these functions are interrelated with the goals and objectives of the companies.
These functions consists of all he activities that will hep the company in achieving
the goals and objectives of the company. The various functions can be classified as
HRM, Research and development, finance, accounting, sales , purchases etc.
Walmart is performing all these function inn their organisation in an effective
manner and that is why they are growing at a very fast rate. By increasing sales ,
they aims to increase the profits of the company . They are also having a proper
organisational structure which helps the managers of the company in giving duties ti
the members present in the company. Below mentioned the interrelationship of
organisational structure with its functions and objectives:-
 Marketing department –This function plays a very important role in
Walmart. It helps in increasing the value of the products in the market as well
as achieving the competitive advantage in the market. With the help of
marketing , managers can attract more and more customers by increasing
profits as well as sales . It helps in making a good brand image of the
company (Fernando, 2011).
 Human resource management – The human resource department of the
company is working at all levels in Walmart and helps in establishing
cooperation and coordination among the team members. They give various
suggestions that helps the employees in performing their work in an effective
manner and also helps in defining the roles and responsibilities of the
company.
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 Productions and operations – It is an essential function that is to e performed
by the management of the company which helps them in attracting more and
more customers (Gebauer, Paiola and Edvardsson, 2010). If Walmart will not
produce goods as per the needs and demands of the customers then the
customers will not come to their store. So, it is very essential to make the
goods as per the customer's demands. s
 Accounting and finance – The accounts and finance department of Walmart
helps the company in providing details about the money and transactions that
are happening in the company on daily basis. They also help in promoting
business, run market surveys, creating assets etc. they also managers the
vendors and creditors of the company as well.
 Research and development – The R&D department of Walmart is very
effective as they know which goods are to be produced in the market and
which should be not. They help in continuous development of the products ,
helps in implementing plans and policies which helps in growth and
development of the company.
TASK 3
P4 Positive and negative impact of Macro environment on Business operations
There are two factors that are present in the business environment and which affects the
activities and functions of business environment as well. These factors are classifies as ; Micro as
well as Macro environment. Macro environment is having significant impacts on activities thatv
are performed by the company. These elements that are present in the external environment are
having a effect on the work done in the company (Halbert and Ingulli, 2011). But it is not
always positive, it can be negative also. The elements that are present in Macro environment are
-
Political – There are various laws and regulations that are prepared by the government of UK for
performing the business activities. Its affect can be see in Walmart as it helps in sales and
purchase of retail products in the target market.
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Economical – The success and growth of the cited company is dependent of the economic
factors that are flowing in the society. It helps in improving the supply of goods and services in
the society (Hamilton and Webster, 2015) .
Legal – Walmart is following all the laws that are made by the government of UK and is
therefore liked by the services as well. They kn ow what are the rights of the customers and
employees which can be used by them in case of any problem.
Technological - In Walmart, various tools and techniques are used by the managers in
performing their activities. They are having their own websites through which they do their
business more efficiently.
Social – Walmart is performing their activities as per the culture and rules present in that area. It
is very important because then only they will be able to gain more customers and their trust as
well. Social factors are as- age distribution, population growth, income level,
occupation, career attitudes etc.
Environmental - In Walmart, the managers make use of various typs of energies to make
products that does not harm the lives of the customers . They try to produce green and
ecological products for their customers so as to show them that they are environment friendly .
The positive impacts of Macro environment are -
 It helps in the development of the society .
 They help the customers by providing them good quality products and services.
 Through pestle , it helps in understanding the environment of the company in a better
manner.
 They help in encouraging and developing strategic thinking for the companies which
helps the managers to achieve goals and objectives of the target market (López-Gamero,
Molina-Azorín and Claver-Cortés, 2011).
The negative impact of Macro environment are ;-
 The process that is followed by the management of the company should be effective
otherwise it will not impact the functions
 It is considered as time consuming and costly.
 They do not allow the managers to take the decisions on their own. They have to follow
the rules and regulations that are made by the government and the society.
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 All the changes that occur in various sectors like if a new technology or a new method is
involved then it is not possible for the companies to adopt them all the time.
TASK 4
P5 Internal and External analysis of Walmart
There are two ways in which the performance of the company can be analysed which
includes; Internal analysis and External analysis (Mahmood and Hanafi, 2013). In internal
analysis, company will have to perform Swot analysis and for external analysis , the company
will have to perform its Pestle analysis.
SWOT Analysis of WALMART is as follows:
Strengths Weaknesses
 It is considered as a powerful retaining
brand in all over world.
 The company provides all the facilities
that is required by the customers and
thus they are able to retain them for
longer period of time.
 They have grown tremendously during
the past years and have also expanded
themselves in various other new
countries.
 It is the largest retailing company but
uis still having their presence in only 14
countries only.
 Customers sometimes becomes curious
aboutr the quality of produst that is
supplied to them .
 Uk ecomnomy is having a policy of
keeping the waqges of tye employees
low as compared to other countries.
Opportunities Threats
 They have still not entered few of the
international markets especially the
Asian countries.
 They can do joint ventures to various
other countries in order to increase the
market share in the international
market.
 Because of inflation in US , their
 They are facing competition from all
sides like nationally, at regional level as
well as local level.
 Substitutes of the products are available
very easily in the market.
 Competitors are already having a good
control over the international market
which they are planning to enter.
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population is diverted towards Walmart
as they are providing products at cheap
rate.
PESTLE ANALYSIS of Walmart is as follows:-
Factors Analysis
Political  UK government is planning to strengthen their relationship with
USA .
 They are having a moderate political risk.
 Their VAT increased from 18% to 21%.
 They are having income tax 5% lower than their neighbouring
countries.
Economical  They have faced economic crisis in UK.
 They are having a high unemployment rate in the economy approx
24.6%.
Social  They are considered as a price sensitive market.
 The population of UK has also grown very much till 2015.
 They are having easy terms and conditions and are also providing
after sale services for their services.
Technological  They are adopting electronic point of sale(EPoS) and electronic
scanners techniques which have improved the efficiency of
employees and company.
Legal  They are having strict competition and anti trust laws .
 They are not allowed to sell below cost.
Environmental  They have reduced the consumption of energy by 5.2%
P6 Interrelation of Strength and weakness with external Macro factors
In a business organisation , it can be said that all the functions that are performed inside it
are interrelated with each other. Its strengths and weaknesses are connected with the external
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environment factors (Agarwal, Grassl and Pahl, 2012). It can be in a positive way as well as
negative way. The interrelationship can be explained as :-
 Political factors – New laws are introduced by the government of UK which sometimes
works in favour of companies and sometimes not. The new tax policy that was
implemented in UK was not appropriate for WALMART as it burdened the customers to
pay the taxes that were implemented and they were not in a position to so this.
 Economic Factors - The economic conditions that were presented in the economy was
not good and that is why the companies that was operating there had a burden on them to
increase profits as well as employment (Aterido, Hallward-Driemeier and Pagés, 2011).
 Social factors – If WALMART will not do any efforts to know the taste and choices of
the consumers then they will not be able to produce goods as per the the customer's
demands and thus customers will not be attracted much.
 Technological factors – Technological advancements will help in proper functioning of
activities. All these developments will make the organization more strong and will leave
a positive impact on the company.
 Legal Factors – Various laws and regulations are made by UK that are
performed by the management of the company. Walmart is following all these
laws and that is why they are gaining trust and belief of the customers.
CONCLUSION
From the above report, it can be concluded that business environment helps in gaining
profits and productivity of the company. It helps in achieving the goals and objectives of the
company. The report that is presented above deals with three types of business organisations
which includes Public sector, private sector and voluntary sector. Here, all the factors that are
present in the environment which affects the activities of the company is included. Here, the
organisational structures of company is also included through which the company is able to
distribute the roles and responsibilities to the members present in the company. Interrelationship
between different organisational function linked with organisational structure is analysed in a
deep manner here.
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REFERENCES
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growth? Business environment and employment growth across firms. Economic
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Fernando, A.C., 2011. Business environment. Pearson Education India.
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Halbert, T. and Ingulli, E., 2011.Law and ethics in the business environment. Cengage Learning.'
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López-Gamero, M.D., Molina-Azorín, J.F. and Claver-Cortés, E., 2011. Environmental
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Online
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