Business Environment: Understanding the Dynamics of Organizations and Success

This assignment delves into the intricacies of the business environment, exploring the diverse types of organizations found in the public and private sectors, particularly in the UK. It examines the impact of local, national, and global economic factors on a prominent business like Tesco. The importance of accounting for business success is highlighted, along with the crucial roles of the HR department and employment legislation. The assignment also delves into team dynamics, analyzing the stages of team development, assessing motivation theories, and describing different leadership styles. Finally, it explores the impact of customer service on business success and the benefits of customer profiling.

Business Environment
1

Table of Contents
Introduction......................................................................................................................................4
Task 1 ppt........................................................................................................................................5
1.1 Describe the types of organisations found in the public and private sectors in a named
country. You may wish to use examples from the UK or another country with which you are
more familiar...............................................................................................................................5
1.2 Explain the different structures within the businesses in your selected country and suggest
reasons for the variation...............................................................................................................6
1.3 Identify a named business and describe how the local, national and global economic
environment impacts on this named business..............................................................................7
Task 2...............................................................................................................................................8
2.1 Explain the importance of accounting for business success..................................................8
2.2 Describe the different functions carried out by the HR department in a business................8
2.3 Outline key features of employment legislation....................................................................9
Task 3.............................................................................................................................................11
3.1 Interpret the information on the profit and loss account......................................................11
Task 4.............................................................................................................................................12
4.1 Carry out an analysis to determine your own and others’ roles within a team. Write up the
results of your work...................................................................................................................12
4.2 Produce detailed notes which can be used to support future training events which:..........12
a) Describe the stages of team development..............................................................................12
b) Assess three motivation theories...........................................................................................13
c) Describe different types of leadership style..........................................................................13
Task 5.............................................................................................................................................15
5.1 Explain the impact of customer service on business success..............................................15
5.2 Explain the benefits of customer profiling to a business.....................................................15
2

Conclusion.....................................................................................................................................17
Reference List................................................................................................................................18
3

Introduction
The environment if business is influenced by many factors. The type of organization determines
the profit making strategies. The structure of the organization draws out the ownership pattern.
The ownership pattern has a direct impact on the capital that would be spend in an organization.
The employees are the main assets of the organization. Some employees are efficient from the
beginning and to some the habit of efficiency has to be inculcated. This can be achieved by
following some leadership styles and motivational theories. This assignment would shed light on
the importance of accounting in a business organization. The other things that would be
discussed here are the different functions that are carried out by the different departments of the
business. The customers are the vital part of the business. Targeting the consumers, and applying
various sales theories also help the organization to grow.
4

Task 1 PPT
1.1 Describe the types of organisations found in the public and private sectors in a named
country. You may wish to use examples from the UK or another country with which
you are more familiar
Business organization is vital for the economic growth of the country. All the business
organization belongs to either the private sector or the public sector. The third type of business
organization is voluntary organization. Charities mainly belong to the voluntary organization and
they are not aimed at earning profits. These organizations only focus on the betterment of the
society. The companies in the public and private sector are aimed at making profit.
Governmental bodies head the organizations, which belong to the public sector. The private
sector has organizations, which belong to the individuals (Ries, 2018). The organizations that
belong to the private sector are only aimed at making profits. Organizations in UK and rest of the
world can be further divided into categories according to ownership. There are different kinds of
ownerships are given below:
Sole Proprietorship: When an individual owns a business organization, it is known as sole
proprietorship. The owner faces unlimited liability. Small business organizations have this kind
of ownership pattern. All the vital decision in these organizations is taken by the owner or the
proprietor. Generally, salons, small consultancy and service providing firms have this kind of
ownership (Hatch, 2018).
Partnership: When a business has more than two owners, it can be termed as a partnership firm.
In this type of organization, the profit percentages are decided beforehand. Both the partners are
responsible for taking decision in the organization. The partners in the organization enjoy
unlimited liability. Accounting firms follow the partnership pattern of ownership.
Corporation: A business organization, which has a different legal personality from its
entrepreneurs, can be termed as a corporation. Limited liability is enjoyed by the stockholder,
who is also the owners of the company. The stockholders decide the activities of the
organization. Organizations, which deal in shares, belong to the corporation type of ownership.
5

Corporation ownership can be further divided into Limited Liability Companies (LLC), and
Cooperatives.
1.2 Explain the different structures within the businesses in your selected country and
suggest reasons for the variation
The hierarchy of a business organization is defined by the organizational structure it follows. The
responsibilities and roles are divided following the structure the organization follows. The
structure of organization that each follows determines which department should take what
decisions and which department would be powerful in the organization. All the projects in an
organization are impacted by the structure it follows. The changing market scenario,
competition, history of the business, industry is important factors in determining the structure of
the organization. For the management of the project in an organization, there can be three
organizational structures that can be put to use in modern times, which helps in the achievement
of the company goals (Burke, 2017).
Functional type is the first type of organizational structure. This is the most common type of
organizational structure. Its determines the effectiveness of the departments such as, human
resource, marketing, information technology, sales and so on. Through the head of the
departments, information and requests are transmitted. In this type of organizational structure the
team members or the employees engage themselves in project work as well as departmental
work.
The second type of organizational structure is projectile. The projects in the organization
determine the working of the entire company. the controlling of the projects has to be done by
the project managers (Harper, 2015). For the need of resources, there are no departments. In case
the project is over, the person is shifted to some other project or he/she has to find a new job.
Matrix organization is the third type of organizational structure. The positive aspects of
functional and projectized structure are incorporated in the matrix structure. The dedication
related to project is ensured by the projectized organizations. This ensure high success rate for
the project. The sustainability of the resources, which are being used in the project, is determined
6

by functional organizations. In matrix type, the members of the team have to inform the project
managers who also work as functional managers.
1.3 Identify a named business and describe how the local, national and global economic
environment impacts on this named business.
The local, national and global economic environment affects business organizations. The
business organizations in UK are no different. They are also affected by the changes that take
place in the economy. Tesco is a huge organization in UK. It is a super-market chain, which has
many stores all around in UK. Tesco has helped the economy of UK to grow. The company has
generated 20,000 jobs in 2018, which has boosted the employment rate. This year, Tesco has hit
a four-year high. In the year of 2017, Tesco has garnered revenue of 85 billion pounds which had
a direct and positive impact on the economy of UK (Tesco.com 2018). After Brexit, the
economic scenario has seen many changes in the local, national and global level. Tesco has 14
stores in UK. It is expanding itself in the number of stores. The organization is planning up to
open more new stores in the local regions. There is no presence of recession in the market of UK.
The local people also have an ample amount of money to spend. This could a good opportunity
for Tesco to open up new stores. On the national front, the economic environment has a positive
impact on the business of Tesco. The national economy of UK is witnessing a positive curve in
its growth. This is the best time for Tesco to expand its business (Duranton et al., 2015). The
government of UK has relaxed the taxes on the import and export duties. Tesco has expand its
business in the terms of the products it can offer. After Brexit, there is a huge opportunity for
expansion in the countries outside UK. The organization should utilize this opportunity to
maximise its profit percentage and market shares. Globalization is taking a new shape in the
present global scenario. More countries in the developing nations like India are trying to
collaborate with super powers such as UK. Tesco should grab the markets and the potential that
lies in the developing countries. The global economic environment is favourable for the
expansion of business outside the boundaries of the continent.
7

Task 2
2.1 Explain the importance of accounting for business success
There is a drastic change observed in recent business across the globe. Use of technology has
brought advancement in business and resulted in operations that were once thought to be
impossible for businesses. Importance of accounting is one such change that has influenced the
business environment and enhanced reliability in business. The reason of accounting is still the
same but the ways and measure have evolved in recent years. Every business use accounting to
keep record of the financial activities that helps in tracking the costing and profit of the
organisation. Enhancing the organisational profit is one of the most important goals of every
business and for recording the gained profit; an organisation needs help of accounting (Smith,
2017). Accounting analyses the investments and costing of the business and helps the
organisation to prepare budget for the next year. The recorded financial information helps the
business to plan standard costing for future. Accounting helps the business to shed light on the
difference between their performance and the standards of the industry. This helps the
organisations to improve their own standards as well as compete with the rivals to get hold of the
market. Many businesses use pro forma to record the expected accounting information in order
to convince the investors about their plans. Every business organisations follows a structure and
in order to differentiate one company with other, but accounting highlights the financial
performances of an organisation and compares it with others to find the difference. In the recent
years, accounting has expanded and presently there are many accounting firms, which help
business to records their financial information (Hoque, 2018). The use of these accounting firms
is seen mostly in small business to be informed about their tax returns and set budget for next
annum.
2.2 Describe the different functions carried out by the HR department in a business
The HR department of a business organisation is in charge of every activity of a business. The
HR department is the one observing the recruitment process, employee management,
8

maintaining organisational structure as well as handling other issues within the organisation. For
every business organisation, HR department is very important part because if they are unable to
perform their functions and handle the issues well then the business organisation will not be able
to operate properly. The functions of HR department are enlisted below:
Recruitment and selection: Recruitment is the primary yet the most important functions of HR
department. The HR department advertises job vacancies then interviews and selects the
deserving candidates matching the organisational criteria. HR department even organises training
programs for the employees in order to help them understand the job specifications in a clear
manner (Bratton and Gold, 2017).
Understanding and operating considering the labour laws: For every business, it is important to
know about the labour laws. The HR department is the one fulfilling the responsibility of setting
an organisational structure that incorporates the labour laws. HR department is also responsible
to note down all the rules and regulations regarding business and employment in an organisation
(Certo, 2018). The HR department is the one to incorporate the business ethics within the
organisation so that the businesses do not perform any unethical activities for profit gaining.
The other functions that the HR department of an organisation performs include keeping record
of organisation performance as well as track individual performances of every employee and
ascertain their payroll structures. The HR department of an organisation plans the benefits and
rewards the employees will be getting for their work and performance. Managing and resolving
employee issues are another prime concern of the HR department (Bratton and Gold, 2017). The
HR department also develops programmes that motivate the employees to work in a more
effective manner.
2.3 Outline key features of employment legislation.
Employment legislation involves every protective measures of employment and covers the list of
role and features of employer and employee of an organisation. Legislation of employment
covers both the rights of employer and staffs. The employment legislation mainly covers the
rights of employment, equality and discrimination of employment and lastly the health and safety
of employees. The legislation of employment functions in order to stop any kind of employee
9

problems and ensures safety and equality for the employees. Employment legislation sheds light
on the rights of every employee and looks into the matter that every employee is getting what
they deserve. Every business organisation is ought to incorporate employee legislation in the
organisational structure in order to avoid violation of employment ethics. Employment
legislation works as a safety shield for the workforce and does not tolerate any discrimination of
labours (Pierce, 2017). Employment legislation looks into the matter that every organisation has
ascertained safety standards for the employees and has set up compensation scales in case of any
tragic occurrences. Labour management is an important concern that comes under employment
legislation. Employment legislation also sheds light on the importance of training in order to
motivate the employees. Employment legislation also functions in other fields like dismissal of
employees, harassment as well as employee grievances. Employment legislation also functions
in wages distribution. The presence of employment legislation in a business is to manage the
relationship of the management and the employees. By incorporating employment legislation, an
organisation is able to shed light on the fact that the organisational structure is fair for both
employees and business and that every employee will be fairly treated within the organisation
(Pierce, 2017).
10

Task 3
3.1 Interpret the information on the profit and loss account
All the information regarding the performance of a business organization can be derived from the
profit and loss accounts. The profit and loss accounts partners with the balance sheet, which is
required to produce on documentation on the performance of the business. The accounts of profit
and loss tell how many products have been sold and the amount of materials that have been
bought by the organization. The performance of any business organization is determined by the
profits made by it. If the profits made are huge, it can be concluded that the business is running
successfully (Tayeh et al., 2015). When the profit margin becomes less, it can say that the
company is going through a loss. The health of a business can be assessed by the profit and loss
accounts. But there are some limitations to the information that is provided by the profit and loss
accounts. The primary health of the organization is not provided by the profit and loss accounts.
It is not provided by the profit and loss account, whether cash is generated or not. Organizations
that seem to be profitable on pen and paper may not be so in reality. Some companies face major
issues related to cash flow. There are many major sections of the profit and loss accounts, which
gives vital information regarding the organization. Information regarding the turnover of the
organization is provided by the profit and loss accounts. Turnover is the value as sales that can
been achieved in a stipulated time (Murphy, 2016). The cost of sales, gross profit, other
operating costs, and net profit are the other information that are provided by the profit and loss
accounts.
11

Task 4
4.1 Carry out an analysis to determine your own and others’ roles within a team. Write up
the results of your work
When one is working individually the style of work becomes different compared to working in a
team (Botha et al.,2014). At the Chamber of Commerce, I learnt about many theories of
motivation in addition to many leadership style. While leading a team, I analyzed there are many
responsibilities that, a leader has to undertake. The responsibilities of the team members are also
crucial. A leader has to be unbiased in his or her decisions. Leaders should be able to recognize
the potential of each individual working in the team and has to divide work according.
Maintaining co-ordination between the team members is another work for the team leader. The
members of the team should be cooperative and should be able to work under pressure and
deadlines. At the Chamber of Commerce, me and my team were given a responsibility to
conduct a survey. As I was the leader of the team, I selected the topic of survey and the region in
this the survey would be undertaken. I took the suggestions from my team members as well. The
people who had great writing skills were employed to draft down the survey. The members in
my team who had great communication skills were appointed to conduct the survey. I motivated
my team members so that their morale always remained high. In times of crisis, I was always
available to help my team members. I to conduct the workings of my team members used the
transformational leadership style (Anderson and Sun, 2017).
4.2 Produce detailed notes which can be used to support future training events which:
a) Describe the stages of team development
Team development usually consists of five stages, which are enlisted below:
 forming
 storming
12

 norming
 performing
 adjourning
Forming is the first stage for developing a team and this stage sheds light on the skills of the
individual team member, their interests and their area of expertise. Storming on the other hand is
coming forward to the reality of the objective. Norming is dealing with the issues identifying
during storming. Performing refers to the overcoming of issues and working together to achieve
goals. Lastly, adjourning is the last stage that involves breakdown of the team after fulfilment of
objective (Woodcock, 2017).
b) Assess three motivation theories
Three motivation theories are:
Maslow’s hierarchy of needs: This is the earliest motivational theory and concentrates on basic
needs including safety, appreciation and self-actualization (Güss et al., 2017).
Herzberg’s two-factor theory: This theory explains the fact that there are motivational and
hygiene factors that influences satisfaction and dissatisfaction regarding work (Güss et al.,
2017).
Skinner’s reinforcement theory: This theory says that the consequences of previous actions
determine the behavioural changes. There are two kinds of reinforcement, positive reinforcement
that determines positive behavioural changes and negative reinforcement, that determines
negative behavioural approach (Güss et al., 2017).
c) Describe different types of leadership style
There are many leadership styles but some of them are used in most times. The commonly used
leadership style includes situational leadership, transformational leadership and transactional
leadership.
Situational leadership: This leadership style highlights the change in a leader in order to adjust
according to the group the leader is planning to influence (McCleskey, 2014).
13

Transformational leadership: This approach creates positive changes in the groups and with the
completion of objective transforms a member to a leader (McCleskey, 2014).
Transactional leadership: this approach focuses on organisational performance, helps the leaders
in promoting observance among team members, punishes, and provides recognition according to
performances (McCleskey, 2014).
14

Task 5
5.1 Explain the impact of customer service on business success
Good customer services help a business in many ways including profit gain, market positioning
as well as in maintaining good will of the organisation. It is very important for every business to
satisfy the customers because without that no business will be able to grow. Customer services
influences increase in the investors and clients. It is quite evident that the customers also promote
the services that they like, they often inform other customers to use a certain product, which is
better than other similar products (Cook, 2017). This helps business organisation to gather more
customers and hence it is evident that on the other hand an unhappy customer will share the bad
experience with others and forbid them from using the products. Customer service also helps a
business to connect with more investors. When an organisation has a proper customer service it
eventually attracts the interest of other stakeholders.
In order to maintain business success, an organisation needs to prevent any kind of negative
opinions from the customers and this is done mainly through online surveys that records the
opinions of the customers and helps the business to incorporate those changes as per
requirements. Customer who receives best services helps the organisation with regular profit. In
other words, it can be said that, good customer service influences good business. Good customer
service helps organisation with repeated and increased income. In order to maintain success in
business it is important for a business to allow the customers to provide feedback that will help
in understanding the required changes (Cook, 2017). Good customer services can be practised
by paying proper attention towards customer management. Customer service influences business
to bring innovative ideas as well as new products so that more customers are attraction.
5.2 Explain the benefits of customer profiling to a business.
Customer profiling records all the purchase histories and helps the business to plan attracting
more customers. Customer profiling helps the business to get knowledge about the customer
requirements and plan strategies to fulfil those. Customer profiling helps a business to develop
business activities. Customer profiling records the choices and preferences they have and it sheds
light on their buying intentions. Customer profiling is easy to prepare but needs continuous
15

updates. Customer profiling in business helps them to improve communications within the
organisation. When a business organisation has a proper customer, profiling then it becomes
easier for them to communicate with the customers regarding the services. Customer profiling
helps in better opportunities like restructuring the products according to customer choices and
gain repeated profit (Brown et al., 2018). Customer profiling helps the business to focus only on
the customers without worrying about the competitors because the organisation knows the target
customers and their preferences and has the ability to satisfy their needs, which results to
continuous profit gaining.
Customer profiling helps a business to focus on customer needs and attract more customer by
implementing a better marketing strategy. Customer profiling is a very effective way for having
competitive advantage in the present business scenario. A customer profile helps the organisation
to restructure and update the requirements of the customers and offer them services that will hold
them from switching choices. Having a customer profile helps the business to provide them the
basic about the company products. Online surveys, face-to-face interaction with the staffs and
filling up of feedback form will help the business to create a customer profile and record the
needs (Brown et al., 2018). Customers are the main concern for every industry and that is why
every business requires having a record of their customers so that they can satisfy them, which
will eventually lead to business expansion.
16

Conclusion
In this assignment, nearly all the factors has been discussed which has an effect on the business
environment. The different types of organizations that can be found in UK has been discussed.
We have also assessed the structure of organizations that prevail in UK and their vital
characteristics. The next thing that was discussed has how Tesco has helped the economy to
grow along with the local, national and global economic environmental factors that affect the
business of Tesco. Accounting is very essential for running a business successfully. All the
information that is provided by the profit and loss accounts have been discussed here. The key
features of employment legislation which has a direct influence on the business environment of
an organization has been stated here in this assignment.
17

Reference List
Anderson, M.H. and Sun, P.Y., 2017. Reviewing leadership styles: Overlaps and the need for a
new ‘full‐range’theory. International Journal of Management Reviews, 19(1), pp.76-96.
Botha, A., Kourie, D. and Snyman, R., 2014. Coping with continuous change in the business
environment: Knowledge management and knowledge management technology. Elsevier.
Bratton, J. and Gold, J., 2017. Human resource management: theory and practice. Palgrave.
Brown, T.R., Conti, T.W. and Moser, K.R., International Business Machines Corp, 2018. Run
time workload threshold alerts for customer profiling visualization. U.S. Patent Application
15/424,971.
Burke, W.W., 2017. Organization change: Theory and practice. Sage Publications.
Certo, S.C., 2018. Supervision: Concepts and skill-building. McGraw-Hill Education.
Cook, S., 2017. Measuring customer service effectiveness. Routledge.
Duranton, G., Henderson, V. and Strange, W. eds., 2015. Handbook of regional and urban
economics. Elsevier.
Güss, C.D., Burger, M.L. and Dörner, D., 2017. The Role of Motivation in Complex Problem
Solving. Frontiers in psychology, 8, p.851.
Harper, C., 2015. Organizations: Structures, processes and outcomes. Routledge.
Hatch, M.J., 2018. Organization theory: Modern, symbolic, and postmodern perspectives.
Oxford university press.
Hoque, Z., 2018. Methodological issues in accounting research. Spiramus Press Ltd.
McCleskey, J.A., 2014. Situational, transformational, and transactional leadership and leadership
development. Journal of Business Studies Quarterly, 5(4), p.117.
18

Murphy, C., 2016. competitive intelligence: Gathering, Analysing and Putting it to Work.
Routledge.
Pierce, J., 2017. Employee Inventions in the United Kingdom.
Ries, C.P., 2018. Introduction and overview. In Capital Controls In Emerging Economies (pp. 1-
12). Routledge.
Smith, S.S., 2017. Strategic Management Accounting: Delivering Value in a Changing Business
Environment Through Integrated Reporting. Business Expert Press.
Tayeh, M., Al-Jarrah, I.M. and Tarhini, A., 2015. Accounting vs. market-based measures of firm
performance related to information technology investments.
Tesco.com. (2018). Tesco - Online Groceries, Homeware, Electricals & Clothing. [online]
Available at: https://www.tesco.com/ [Accessed 9 Jun. 2018].
Woodcock, M., 2017. Team development manual. Routledge.
19

20