Business Environment Of Organizations A : PDF

Business & Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
P1 Different types and Purpose of organisation.....................................................................1
P2 Size and Scope of different types of organisation.............................................................3
P3 Relationship Between Organisational functions...............................................................5
P4 Positive and Negative Impact of macro environment on business operations..................6
P5 Internal and external analysis of organisation and their strength and weaknesses...........8
P6 Interrelation of strength and weakness of macro environment elements on a company...9
CONCLUSION..............................................................................................................................10

INTRODUCTION
Business environment can be defined as different external and internal factors which
basically impacts upon functioning of a business firm. In this context, there are a range of factors
like legal, social, economic, technological, political, stakeholders that basically affects overall
working of a business company. Thus, it has become very much important for multinational
companies to analyse these elements at the time of taking decisions like strategies and so on
(Business environment. 2018.). In this report, the different organisations that are being taken are
ASDA in private, Oxfam in voluntary and Crown Prosecution Services under the public sector.
Along with this, report will keep its focus on size and scope of different types of organisations,
relationship between organisational functions. On the other hand, assignment will also put light
on positive and the negative impact of macro environment on business organisation's operations.
P1 Different types and Purpose of organisation
There are various types of business organization prevailing within corporate world. These
are given below:-
Private Organisation
These organization run with so many process with the purpose of making profit by a
person, partnerships, corporation, agency or an association. ASDA is a British super market
retailer company which was founded in 1949 by Peter and Fred Asquith in England. Industry
deals with the grocery, general merchandise and financial services which attract to their customer
in the form of attractiveness of their product.
Purpose: ASDA is a multinational retailer company with having a purpose to be the
Britain's best value retailer exceeding customer needs and wants always. Main purpose of ASDA
is to create value for customers to received their loyalty forever. According to ASDA their
customers wants new types of product at cheap cost (Hilton and Platt, 2013). It is the
responsibility of company's to accomplish the want their customer in a perfect way.
Legal Structure: If the talked about legal structure of ASDA so, their liabilities are
limited because company has their parent organisation that is Walmart. Therefore, competition is
high. It was founded in 1949 by Peter and Fred Asquith, Sir Noel Stockdale.
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Stakeholders: Since ASDA is a private sector business concern its stakeholders are
employees, investors, suppliers etc. All these people are quite important for a company as they
have solemn interest in business functionality and growth.
Public Organisation
Public organisations are those which run and operated by the government and survive to
render their services to their native. They are those who rarely involve in private organisation to
deliver goods and services to their resident. The Crown Prosecution Service is the principal
public prosecuting company for conducting criminal prosecutions in England and Wales, this
was founded in 1986 by Paul Staff.
Purpose: The main purpose of Crown Prosecution Services is to defend criminal cases
that have been investigated by the police in England and Wales. They provide effective legal
advices to found agencies and police (Bharadwaj and et. al., 2013). These organisations conduct
their services in secondary sector and received raw information and further offer advices. It is
also advice the police on cases for possible prosecution.
Legal Structure: Crown Prosecution service is an independent judicial agency which is
responsible for the presentation of criminal prosecution in the United Kingdom. It was formed in
1986, which is non-ministerial government department in England and Wales. There are civil
and family courts, criminal courts and legal profession which helps in making essential decisions
evaluate plans according to these policy.
Stakeholders: Stakeholders of public organisation are influenced by the actions and
policies of companies. It includes government employees, financial institutions which are owned
by shareholders and government.
Voluntary Organisation
Voluntary organisation describes to a group of individuals who enter into an agreement,
mainly as volunteers, to form a body to attain the purpose and goals of an organisation. Oxfam is
an alliance of 20 independent charitable organisations which is focusing on the relief of global
poverty.
Purpose: It has a main purpose that help in making easy solutions to the injustice of
poverty. Their vision is to have a world without poverty (Berg and Kilambi, Siebel Systems Inc,
2014). They want a world in which people can enjoy their lives and rights and they can describe
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their decisions and can assume their responsibilities. The mission is to have a world in which
each and every people is treated equally.
Legal Structure: In this Voluntary organisation which consists of unincorporated
association, trust, community interest company, etc.
A trust: In a trust people work in the form of manage and provide important fund to do welfare
of a community. According to this trustees are the person who are able for contract that are stable
on the behalf of trust.
An Unincorporated association: It is a group of people if individual in this there are no such legal
existence. All legal proceeding that are taken are basically on the basis of groups.
Stakeholders: These are the one who are interested and influenced by the voluntary
organisation is said to be a stakeholder. These includes in board, founders, staff, volunteers,
beneficiaries and donors.
Voluntary business concerns generally operate on international level and work towards
growth and welfare of all nations as a whole (Schaltegger, Lüdeke-Freund and Hansen, 2012).
Hence in this context growth of international business environment is also ensured as when
welfare of each and every nation is ensured, it also provides a developed and profit enhanced
environment at business.
P2 Size and Scope of different types of organisation
There are different types of business organisations which are mentioned below -
Public organisation: Crown Prosecution Service
Product & Services Size and Scope Vision Mission
Crown prosecution
services is a legal
sector public
organisation which
provides law based
advice to investigators
as well as police
departments. They
In context of Crown
prosecution services,
they have 80000 and
more cases of
prosecution in their
control. Along with
this they also have
around 2900 solicitors
Vision statement of
CPS is to be
independent in their
business operations
and offer fair advices
to people.
Mission of CPS is to
be fair and free in their
work and to work in an
ethical and
professional manner.
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collect and examine
raw data and based on
that determine charges
against suspects.
and 600 employees as
well.
Private Organisation: ASDA
Product & Services Size and Scope Vision Mission
ASDA is a
multinational
supermarket chain
store which deals in
retail sector and
provides a number of
goods and services
such as dairy products,
consumable goods,
fruits and vegetables
etc.
ASDA is a large
multinational
supermarket with
around 633 chain
stores all over the
world. It employs
around 165000
employees (Ballard
and et. al., 2012).
Vision of ASDA is to
provide excellent
quality goods to their
customers thereby
enhancing customer
base.
Mission of ASDA is to
maintain or retain their
loyal customers for a
longer period of time.
ASDA use to provide their products and services in Europe region only, therefore, they
have possibilities that they can grow their business in Asian region. As they are huge
organisation in Europe and they have huge source of fund, there it will be easy fro them to grow
their business in African market also.
Voluntary Organisation: Oxfam
Product & Services Size and Scope Vision Mission
Oxfam is a voluntary
business concern
which deals in
providing services
In context of size and
scope there are around
20 independent
charitable trusts that
Vision of Oxfam is to
provide better quality
products and services
to people and that too
Mission of Oxfam is to
remove or eradicate
poverty from almost
all areas and provide a
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during calamity
situations such as
floods, droughts etc.
They provide food,
clothing and shelter to
people who are sick or
unhealthy.
come under Oxfam.
All these work for
welfare an d safety of
people (Werbach and
Hunter, 2012).
within affordable
prices.
healthy and safe living
environment to people.
Also they focus
towards maintaining
peace and harmony in
the world.
P3 Relationship Between Organisational functions.
Relationship among different organisational functions plays a crucial role for every single
business organisation when it comes to attain a specific goal or objective. ASDA has kept its
focus on expanding its business among different targeted areas so that their sales could be
improved by 15% within a year. This is being considered as an objective of ASDA which needs
proper management structure and links among different organisational functions. Through this,
ASDA would directly grab a good position at marketplace and may start giving good rivalry to
its competitors in specific time frame (Vitale, 2011). It has been found that, no business company
could basically attain goals or objectives. It is required for managers of different departments of
ASDA or of any company to have proper relation with each other so that no issue could take
place in attaining a set goal. In present context, proper relationship between different
departments of ASDA in order to attain their goal is comprehended beneath:
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 Marketing and Finance Department: Since ASDA wants to expand business and
looking forward to enhance 15% of the sales in a year, that means it would require to the
company to promote itself among different targeted areas. This is done by marketing
department and for developing a plan or even to start marketing manager would require
to have proper funds which could be allotted by finance manager. Right amount can only
be offered if proper connection is there among both the departments.
 Human Resource and Production Department: Business expansion would require a
good number of staff in every single department of ASDA. This would require an
effective HR department but, requirements among different sub sections can be antithetic
like production section would require a special team that might know different languages
so that they could communicate with targeted customers (Janita and Miranda, 2013).
Here, it is responsibility of production manager to inform the same that what they are
looking for so that HR manager could directly recruit different individuals. In addition to
this, marketing department in ASDA help human resource department to find them the
source of effective candidates for the organisation. Whereas, in return human resource
department aid marketing unit by providing them skilled and qualified labour force. This
will simultaneously benefit company to increase their profitability and productivity.
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Illustration 1: Organisational Structure

 Sales and R&D Department: Sales department of any company would require to have
link with every other department of a business organisation. If it is talked about ASDA,
company has kept its focus on business expansion through improving sales by 15% in a
year. Here, research and development subsection of ASDA will help sales manager in
taking right decisions which will directly aid ASDA in attaining the goal.
All departments in ASDA are performing their functions in inter related manner. This
will not only benefit company to achieve their target in effective time frame but also to maintain
smooth working condition in their workplace. These all department helps ASDA to attain their
business goals and set of objectives in order to enhance the growth of the company. Also the
Interrelations between different organisation department provide various advantages to a
company. In respect of ASDA, these interrelations will benefit them to adopt effective channel of
communication and attain their gaol and objectives in formative way.
All these departmental units in ASDA work together so to maximise overall productivity
of company and aid them to gain more advantages in market against their competitors (Wheelen
and et. al., 2017). It is certain that there will be a situation of conflicts that may arise in this
course that can be a limitation for the organisation. So managers need to adopt strategies and
policies in order to decrease impact of these situations on company and employee performance
(Ballard, 2012). This will benefit ASDA so as to enhance effectiveness of their workforce and
increase profitability of company simultaneously.
P4 Positive and Negative Impact of macro environment on business operations
ASDA is a renowned name within retail industry. Its brand reputation and stake in market
owes to its exceptional product and service delivery which has rendered a competitive edge to
company over its rivals. Yet there are various factors present within the macro environment
which influence the operations as well as functioning of enterprise. For ascertaining such factors,
managers of ASDA have conduced PEST analysis:
Political: These factors represent the policies and regulations passed by government of
any country. ASDA needs to take in consideration political factors so as to avoid intervention of
law in any of their activities (Prins and Cybercrime, 2011). Positive: The political condition of UK is stable which reflects that the policies and
regulations made by government remain consistent from year to year. Thus, ASDA can
conduct operations in accordance with these rules and avoid any legal mis happening.
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 Negative: With any change in policies such as export or import duty, financial
performance of ASDA can get affected to a great extent and even lead the company to
loss.
Economical: These factors represent the economy of a country and comprises of aspects
such as borrowing rate, inflation, taxation policies etc. ASDA has to take into account these
factors to ensure its sustainability within market for a long period.
 Positive: UK has a strong economy which provides various opportunities for ASDA to
conduct operations in a feasible manner. Also, rebates in tax rates by UK government
assist the organisation in selling its goods at affordable prices.
 Negative: A rise in borrowings or inflation rates directly affects their operations and
functioning in marketplace.
Social: These factors refer to the cultural and religious beliefs of population which
largely affect the operations of company (Weiss, 2014). Positive: ASDA takes into considerations the lifestyle of people of UK and ensures that
company produces such products and services which meets the needs and demands of
consumers. This helps in improving their profitability as well as brand image. Negative: To avoid any discrepancies, ASDA adhere to CSR responsibilities. In case,
they do not follow CSR initiative, the brand name and stake of company can get
hampered.
Technological: With passage of time, there have been a number of advancements taking
place within retail industry of UK. ASDA needs to consider technological factors so as to
maintain their reputation in market. Positive: The R&D department of ASDA analyses and evaluates the latest trends and
techniques existing within the market to ensure that techniques of company are aligned
with those being used within retail sector (Werbach and Hunter, 2012).
 Negative: Executing the latest tools and techniques of industry across the organisational
premises leads ASDA to invest a huge amount.
Legal Factor: It is necessary for an organisation to abide all legal rules and regulations
in order to conduct their business operations in ethical manner. As ASDA is a multinational
company and operates their functions worldwide their follow all Governmental laws that have
been laid down by United Kingdom government.
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 Positive impact: By abiding laws and rules ASDA will be able to earn loyalty of their
employees and also lead to development of a sense of belongingness as well.
 Negative impact: Following various rules and laws will be quite a complex process and
may even lead to hampering of organisation’s working.
Environmental Factor: Environmental factors mainly include efficiency and availability
of raw materials, risk of exposure and present and future compliance. All these factor can impact
organisation functioning directly or indirectly. Positive impact: Adopting new eco-friendly ways of manufacturing products and services
will help ASDA in strengthening their market image and goodwill.
 Negative impact: It is a quite costly and time consuming process (Bharadwaj and et. al.,
2013).
P5 Internal and external analysis of organisation and their strength and weaknesses
ASDA is a chain of supermarket retailer which is headquartered in West Yorkshire. This
company offers supermarket chains as well as financial services and mobile phone manufacturer.
There is the SWOT analysis of the company, which will help them to identify their strength and
weaknesses -
Strength Weaknesses
 ASDA provides amazing marketing
campaign which shows services and
customer delight.
 The company is involved in various
CSR activities.
 ASDA is proactive in successful
acquisitions in the company.
 It provides online services to customers
which helps in increasing customer
satisfaction (Avramenko, 2012).
 ASDA is not involved in expansion of
its business at global level.
 Their entry is restricted in some areas
because the country fears a competition
with local vendors.
Opportunities Threats
 Expansion of business in different areas
including pharmacies, jewellery and
 Existence of price war with other retail
chain brands. Examples of major retail
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opticians.
 Introduction of ventures in growing
markets like China, India, etc.
sector business concerns are Marks and
Spencer, Sainsbury’s and TESCO.
 It has a threat from various changing
policies of government and taxes.
Strengths and weaknesses of TESCO :-
Strength : The main strengths of TESCO is huge structure and working in different countries of
world. Along with this, they have huge source of finance which help them in making huge
investments for their expansion.
Weaknesses : The main weakness of them is the growing competition and their weak strategies
which are not able them in getting any competitive advancements.
It is concluded from above analysis that ASDA should work upon expanding its business
globally. As it is providing good service to customers since years and it has become a globally
well-known retail chain of supermarket there are various possibilities of success of its profits in
foreign countries too.
P6 Interrelation of strength and weakness of macro environment elements on a company
There are different ways by which an organisation overcome its weakness and develops
its strength for maximising sales of company (Wheelen and et. al., 2017). The company is
surrounded by various elements that helps to shape opportunities and pose threat to the company
and these are called as macro factors. ASDA requires to meet the demands of consumer and
expanding their business in foreign countries. Interrelation of strength and weakness of macro
environment in case of ASDA has been described below:
Political Factors– ASDA provide access to
high quality fresh food at very low price across
the globe. It is necessary for this company to
work as per laws and regulations of the country.
Strengths: When organisation follow all rules
and regulation given by law it helps in smooth
functioning of organisation (Schaltegger,
Lüdeke-Freund and Hansen, 2012).
Economic Factors– These include factors like
interest rates, demand and supply, recession,
inflation, etc which affects ASDA's business
at domestic as well as international level.
Therefore, the company should be aware of
the changes in government rules and policies
such as changes in taxation.
Strength : It is advisable for ASDA to make
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Weaknesses : It is necessary for them to follow
UK government laws as it affect their decisions
and strategies of business is large manner.
policies and rules keeping economic factors in
mind. This helps to increase company's
competitive advantage.
Weaknesses: Rise in different type of
economic factors in market have a great
impact on smooth functioning of organisation.
Social Factors– ASDA focuses on social
factors and changes are offered in services and
products because of these factors. ASDA has
started focusing on improving brand trust
among employees.
Strength: This helps in increasing customer
satisfaction and loyalty.
Weaknesses: If any company does not consider
social factors it directly affects the efficiency of
organisation.
Technological Factors- Change in technology
has given new opportunities to ASDA in
building good customer relation by providing
them fast facilities. Online delivery, payment
methods, customer feedback portals are used
in ASDA retail supermarket chain to provide
customers a great experience. It is essential for
ASDA to introduce online shopping with
facilities for home delivery and self-service
checkout points have provided convenience to
customers.
Strength: By adopting new and improved
technological tools and techniques will help
ASDA in enhancing their profits along with
raising productivity standards as well.
Weaknesses: A lot of Capital is required to
adopt and install technology in functioning of
company.
Legal Factors: The government policies and
legislations have an impact on the company's
performance.
Strength: Cost of certain products has been
lowered by managers of ASDA so as to meet
government laws and policies (Janita and
Environmental Factor: The pressure on
company to address environmental issues
ASDA has clear objectives to be supplied by
100% renewable energy, to create zero waste
and to sell products that sustain environment
and people.
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Miranda, 2013).
Weaknesses: Due to this factor ASDA is not
able to perform effectively.
Strength: It benefits society and environment.
Weaknesses: This interrupt the growth and
performance of company.
CONCLUSION
From the above mentioned report it has been concluded that business environment refers
to a sum of all internal as well as external forces that affect overall functionality of business. It is
quite important that business concerns examine and evaluate all such forces and factors which
will further help them in attaining better sustainability and growth as well. As per this report
there are basically three types of business concerns namely private public and voluntary. Also
their legal structure along with vision and mission have been stated in this report.
Interrelationships between various organisational functions have also been stated along with
internal as well as external analysis regarding environmental factors has been included. Also
these will help in raising performance and productivity of a business entity.
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Online
Business environment. 2018. [Online]. Available through:
<http://www.investorwords.com/19252/business_environment.html>.
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