Business Environment: Factors and Analysis

This study explores the business environment and its impact on Barratt Development. It discusses the history and organizational structure of the company, as well as how it is managed nationally and internationally. The study also covers the importance of PESTLE analysis and evaluates the political, economic, social, technological, environmental, and legal factors that influence Barratt Development.

BUSINESS
ENVIRONMENT

Executive Summary
Business environment is sum of external or internal environment which surrounds with the
employees, customers, expectations, supply and demand, management etc. on the other side, all
such factors might also impact the business directly or indirect manner. Introduction to the
business environment which is important aspect of any family. The present study has been based on
the topic business environment. Study has been discussed about the topics such as macro factors
which followed by PESTLE analysis. Also study has been discussed the company operation in
nationally or internationally.

Table of Contents
INTRODUCTION................................................................................................................................1
MAIN BODY.......................................................................................................................................1
TASK 1 ...............................................................................................................................................1
History of Barratt development...................................................................................................1
Organizational structure of Barratt developments......................................................................1
HOW COMPANY MANAGED NATIONALLY AND INTERNATIONALLY........................2
(B) Brief discussion on how Barratt development plc has been governed.................................2
TASK 2.................................................................................................................................................3
Importance of PESTLE analysis and its evaluation....................................................................3
TASK 3........................................................................................................................................4
(A) Make a list of the political, economic, social, technological, environmental and legal
(PESTLE) factors that influenced the environment of Barratt development..............................4
(B) APPLY A MINIMUM TWO OF TEH PESTEL FACTORS YOU HAVE LISTED TO
BARRATT DEVELOPMENT PLC. GIVE RELEVANT PRACTICAL EXAMPLES TO
ILLUSTRATE YOUR POINTS..................................................................................................5
CONCLUSION....................................................................................................................................6
REFERENCES.....................................................................................................................................6

INTRODUCTION
Business environment is operated around business activities to successfully accomplish
the company aims and objectives. Business environment get influenced by different internal or
external factors like political, environment, legal, technological, social and economical. Present
study based on the business environment of the Baratt Developments plc which is an largest
residential property dealing company situated in UK. Therefore, in the study it will be explains
the different kind of business structure and in which structure company governed. Also, study
outline the relationship between board of directors and stakeholders in order to maintained the
business positive environment. Study will analyses the company external environment by
implying the PESTLE tool. Overall, study will summarize the negative or positive aspect of the
businesses which might be become threat or opportunity for the businesses.
MAIN BODY
TASK 1
History of barratt development
The Barratt development was founded in the year 1962 by Lewis Greensitt and Lawrie
Barratt. The Lewis Greensitt was the Newcastle builder and the Lawrie Barratt was an
accountant who started the company with 5 years planned extension. The company was based on
the stock exchange of the year 1968. Earlier the company was named as the Greensitt & Barratt
which has achieved the maximum growth and success in the market. The Lewis Greensitt has
left the company in the year 1973 after the flotation and the company was renamed as the Barratt
Developments in the market. The Barratt has acquired and transformed the from local
housebuilders to national firm building. The expansion was done in the profile which was highly
marketed in country(Dobrev, K. and Hart, M., 2015).
Organizational structure of Barratt developments
The organisational structure of Barratt Development PLC is as follows:
 Leaderships
The leadership initiatives taken in the Barratt development PLC were regarding the composition
and structure of the board committees of the organisation. The responsibilities of the financial
activities of the organizations were divided among the individual directors, board members and
committees who were the members of board. The organization focused on the Financial year
2019 in which the financial conditions of the organization may get disturbed. The disturbance
was expected to continue in the year 2020 also so the organization has made many precautions
to get over from these problems. A new directors was appointed for the organization so that
organisational activities can b managed in a better way(Kitsios, F. and Kamariotou, M., 2016).
 Effectiveness
The organization made many progress by the actions which has been arrived from the internal
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evaluation in the year 2018. The outcomes and process of year 2019 has also effected the
organisation.
 Accountability
The work of the organization was done by the audit committees and the board has approached to
the risk management and internal control of the organization (Doyle, T., McEachern, D. and
MacGregor, S., 2015).
 Stakeholders Engagement
The individual director5s has been engaged with the stakeholders and the stakeholder were
easily getting communicated with the organization.
 Remuneration
The remuneration of the organizations shows the summary of the group's remuneration policy.
The outcomes for year 2019 were based on the performance of the organization in a financial
year.
HOW COMPANY MANAGED NATIONALLY AND INTERNATIONALLY
Barratt Developments Plc is one of the international residential property development
companies in United Kingdom. It is operating its network over 30 divisions. It has been listed on
London stock exchange. The company is usually indulged in acquiring and developing land
planning , designs,constructing residential property developments which it builds throughout
Britain. It operates in House building and commercial developments. It holds three brands
Barratt homes , David Wilson homes and Barratt London and one is commercial business brand
that is Wilson bowmen (Baesens, and et.al., 2016).
Its house building segments operates through 6 Regions and 30 divisions.
The main headquarter of the company is at coalville, United Kingdom and it has its
further working as house buildings and commercial developments at 30 different divisions.
Commercial developments are delivered by Wilson bowmen developments. It purchases land
and develops home according to customer needs.
The Barratt started its operations in 1953 by Lawrie Barratt .After that in 1960 it
expanded in north east and listed itself on London stock exchange. In year 1973 it has rapid
expansion and started building homes ar large scale. In 1978 company was first house builder to
give t.v. Advertisements. In 1979 it becomes number 1 house builder in U.K. By building 10000
buildings. From year 2003 it started building dynamic and modern architecture. And now Barratt
is Five star rated company.
(B) Brief discussion on how Barratt development plc has been governed
The board of director of Barratt development plc is had the intimation of having the variant
responsibility for the strategy , management along with performance and long term success of
the respective company a belonging top its subsidiaries.
David Thomas is working as the chief executives from July 2015 achieving the retention of
position group financier directors till the time of January 2015. In the year 2017 there is
announcement of boards that the Neil cooper have the left the mutual agreement of company
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along with immediate effectiveness. The company should have the effective working in terms
of having the preferential board in which the there can have promoted to long term goals in
order to gains the suitable success in ways of generating the value of different shareholder to
have the wider society. The company structures have the establishment of purpose in order to
have value and strategy in getting the stupefaction among the cultures being aligned. The
Barratt development plc should have the effective and enterprises have to work within the
framework of precedents and effective control which have proper Ealing the assessing and
managing the cultures with the group purpose , value and strategy. Deputy CEO and Chief
Operating Officer, Steven Boyes, will continue to support David with his ongoing executive
responsibilities. The Board is launching a search for a new CFO and a further announcement
will be made in due course. The shareholders and the directors have the two competent
relational and identity in the company. The shareholders owning the shares its Harwell and
directors to have properly managing the relationship in porter to achieve the success to
organization (Schaltegger, and et.al., 2016). There relationship have the basis of mutual trust and
respects. There should be proper accountability of the director company to their respective
shareholders in order to have agreement over respective positions and roles setting the targets
by way of taking the new level of initiatives in the areas which are being over lapping. The
relationship between the shareholders and employees are better have positive and negative
impacts as there rea collectively the owner of company. The company director have the
responsibility in have the proper providence of training and development to employees in order
to hale them to achieves there personal gaols along with organizationals mission and vision. The
Barratt development plc should have the effective and enterprises have to work within the
framework of precedents and effective control which have proper Ealing the assessing and
managing the cultures with the group purpose , value and strategy. The decision taken by the
directors have the proper guidances for directive direction of company which have proper
representation of shareholders as to have the proper understanding related to probability and non
profitably of organisational development. David Thomas have the resampling temporary
responsibility for the finance function in order to be supported by both Philip Schumacher and
John Flynn, the Group Financial Controller and Housebuilding Financial Controller respectively
(Trad and Kalpić, 2019.).
TASK 2
Importance of PESTLE analysis and its evaluation
PESTEL analysis is a tool which is used by many different business organizations in
order to evaluate the changes taking place within the external business environment (Kara,
2018). This is very necessary because of the reason that the business operates in the environment
which is very dynamic in nature that is frequently changing and these changes also have major
impact in the working of the company. this impact can be in both negative as well as positive
manner. Thus, the PESTEL analysis helps the business to know that what impact will the
changes of external environment have on business whether positive or negative.
The PESTEL analysis is very important for the companies because of the foremost
reason that it covers every aspect or the sector of external environment whether be it political,
social, economic, technological or environmental or even legal sector. This helps the business to
cover each and every sector of business environment which can be impact the operation of the
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business. Another importance of PESTEL to the different business organization is that this helps
the company in identifying the latest trends and culture going on within the society. This helps
the company as now it can adopt to the latest changes and this will help the company in getting
competitive advantage over the other companies. This is only possible with help of the PESTEL
analysis that the company is able to study the social changes and their impact over the working
of the company. One more importance for the company is that this PESTEL analysis helps the
company in doing strategic planning as the changes have been identified with help of PESTEL
analysis and this further becomes the base of planning for the growth of the company.
Evaluation of PESTEL analysis
In accordance with Nandonde, (2019) the major advantage of PESTEL analysis is that
this tool helps the business in getting a better understanding of the environment as it provides
information of all the sectors pertaining to the overall business environment. But Zahari and
Romli, (2019) argues that this system of doing PESTEL analysis is very costly because the
company has to hire some individual who can go and research about all the factors of the
business environment. This is costly as first the person will ask for salary and also it will require
some different resources to go and search or even internet and computer if research is being
done from office.
In contrast to this Gondek, Boessenkool and Star, (2018) articulates that the this helps the
company in pre- planning for the changes which are going to happen in the future. This is
possible because of PESTEL analysis that the company researches for the changes and they can
plan in advance how to implement these changes within the business. But Popova, (2018) states
that it is a very time-consuming task to research for all the aspects of the business environment
and also needs to take a lot of efforts in researching so vast areas.
TASK 3
(A) Make a list of the political, economic, social, technological, environmental and legal
(PESTLE) factors that influenced the environment of Barratt development
POLITICAL FACTORS
The political stability was maintained in the market while the organization was doing
their business. Though the environment was politically stable, the military invasion was on high
risk. The level of corruption was very high in the organization. The contracts of the organization
were enforced and they were legally framed according the policies and procedures of the
government. The tax rates were high in the market and intellectual property were protected in
the economy.
ECONOMIC FACTORS
The economic factors which effected the business of Barratt Development were the
inflation rates, interest rates of the banks of the country, unemployment rates, economic growth
rates, education level among the people, labour cost and productivity in the organization. All
these factors played a major role in economies of the country.
SOCIAL FACTORS
The social factors which effected the organization was the demography and level of skills
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developments in the population of the country. The cultures, genders, roles and responsibilities
given to the individuals. The attitude of the employees and customers also became a major cause
of social factor.
TECHNOLOGICAL FACTORS
The technological factors which effected the company were the rate of diffusions made
in the technologies. The impact on the cost structure of the household and personal goods were
also a part of the technical factor which influenced the organization. The value chain structure of
the consumer goods was also not stable(Pikhart, 2017).
ENVIRONMENTAL FACTORS
The environmental factors which effected the organization were the weather, climate,
recycling, laws related to pollution, waste management, attitude towards the environment and
the endangered species of the organization.
LEGAL FACTORS
The legal factors which effected the organization were the employment law, health and
safety law, data protection, discrimination law, copyrights, patents and intellectual property law,
anti trust law in personal and household goods.
(B) APPLY A MINIMUM TWO OF TEH PESTEL FACTORS YOU HAVE LISTED TO
BARRATT DEVELOPMENT PLC. GIVE RELEVANT PRACTICAL EXAMPLES
TO ILLUSTRATE YOUR POINTS.
Political Factor : Political macro environmental factor is one of the significant driver
which can affect Baratt Developments plc in long term manner. The major reason of political
fluctuations is dynamic changes in government policies (Haaker and et.al., 2017). This is the
most significant factor which relies on the system and also make difficulties for the existence
business task (Ramadani, and et.al., 2015). There are more different factors that includes in the
political environment such as risk of military invasion, legal framework for contract
enforcement, favoured trading partners. Wage legislation in personal & Household. Industrial
safety regulations in the consumer good sector. Also, Product labelling and other requirement in
personal & household goods. So all such factors affected by the legal regulations and due to
political changes. Political factors negatively affect the organization goals and objectives due to
some political changes. So this is the highly affecting factor which negatively affect the
functions of the business activities(Kasemsap, 2018).
Economical Factor : Economic factor is one of the significant factor which might be
impact the company operational activities. This economic factors get influenced by different
manner like company profitability get affected by market inflation rate, foreign exchange rate,
interest rate etc. these factors impact the company demand and supply, aggregate investment and
business climatic conditions (Shenoy and Aithal, 2016). This factor of business environment
could positively affect the small companies in terms of gaining the customer attraction. But for
the big organizations it negatively affect the business environment. For example, unemployment
level in the country would be the positive sign for the Barratt Developments plc which would
lower the costs of to the company. Also, it requires the best services and growth of the business
organization(Schaltegger,and et.al, 2016).
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CONCLUSION
On the basis of above section, it has been concluded that how business environment can
affect the company positively or negatively. Also, it concluded the company structure and their
operation activities nationally or internationally. Therefore, it has been observed that business
environment is the potential environment which has to be taken into consideration while
conducting or preparing for the new strategies. Also, study evaluated the positive and negative
aspect of the macro factors which followed by the PESTLE analysis. Overall, report analysed
the positive and negative aspect of the business environment and some opportunities area for the
company development.
REFERENCES
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Kasemsap, K., 2018. Mastering business process management and business intelligence in
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