Business Management: Impact of Business and Governance Structures on Performance and Decision Making

This report discusses the impact of internal and external factors on the performance and decision making of managers in the context of two organizations, H&M and Hotel Hilton. It explores the business and governance structures of these organizations, the influence of these structures on performance and decision making, the top three risks faced by the companies, and suggestions for improving business practices.

Business management

Table of Contents
INTRODUCTION...........................................................................................................................1
CASE COMPANY SYNOPSIS......................................................................................................1
MAIN BODY...................................................................................................................................1
a) Business and governance structures.......................................................................................1
b) Business and governance structures influencing performance and decision making.............2
c) Top three risks companies face and how might this influence their decision making............3
d) 3 suggestions regarding how the companies might improve their business practices...........4
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Business management refers to the proper planning, organising and directing individuals
for completing the task properly. There is complete and specific information with managers to
determine ways through which business operations can be performed properly. There will
requirement of complete and specific information about such factors, so it will be easy for
association to determine it (Adekola & Sergi, 2016). This report is based on two organisation i.e.
H&M and Hotel Hilton which deals in Apparel and hospitality sector respectively. In this study,
there is discussion about impact of internal and external factor on performance and decision
making of the managers.
CASE COMPANY SYNOPSIS
There are two organisations which are used in this study i.e. H&M and Hotel Hilton.
H&M is Hennes & Mauritz AB which is Swedish multinational clothing retail brand
providing clothes for men, kids, women, teenagers, etc. This organisation have head quarter in
Sweden and serving in different parts of the country. There are around 45000 stores in 62
countries approximately.
Other organisation is of hospitality and lodging providing services in different parts of
countries. This association is suffering with different parts, but in this Hotel Hilton US is taken.
This association provides services for accommodation, dinning out, conference hall, etc.
MAIN BODY
a) Business and governance structures
Business refers to the activities which are conducted for completing the task. There is
requirement of proper planning for completing the task because this is the best way to determine
and evaluate changes properly (Burns & Dewhurst, 2016). Governance structure refers to
organisational structure which is performed and conducted properly.
Basis Hotel Hilton Hennes & Mauritz AB
(H&M)
Business Hotel Hilon is American based
hospitality organisation. This
association was founded in
This is association dealing
clothing sector providing
apparel for kids, teenagers,
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1919 by Conrad Hilton. This is
ranked as 36th largest privately
owned company in US.
males, females. They have
product at global level. This
association was founded in
1947.
Governance structure In hotel Hilton, there is
divisional organisational
structure because this is the
best way through which
operational are performed and
controlled properly. If there is
demand from consumers, then
specific organisational
department gives their best to
satisfy them.
At H&M, there is use of multi-
matrix organisational structure
because they have many
brands under this name such as
Weekday, Monki, COS,
Afound, ARKET, etc. hence
matrix structure is appropriate
and specific.
There is difference in governance structure because they are dealing in different sectors.
It is not possible that association have to determine and evaluate changes properly (Erasmus,
Strydom & Rudansky-Kloppers, 2016). When there is difference in demand of consumers, then
Food and Beverages department will deal, hence they have to change their stuff and menu. But in
case of H&M, if there is change in demand of consumers, then purchase, production, marketing,
sales, etc. departments gets affected.
b) Business and governance structures influencing performance and decision making
There are many external environment factors which affects business operations of Hotel
Hilton and H&M. There is complete and specific changes in operations because of difference in
determining and evaluating and changes. There are many factors which are considered in
environmental factors such as change in demand of consumers, technological changes, cultural
changes, etc. There is requirement of complete and specific information through which
individuals can perform activities properly and in appropriate manner.
If there is change in economic policies of Sweden, then there will change in interest rate
as well. Cost of product offered by H&M will also gets high because of change in economic rates
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of the country. So managers of H&M have to alter their decisions accordingly and avail products
properly. Managers of H&M have to decide about sources through which information can be
communicated properly. There is change in decision making as well as performance of
employees of H&M because of alteration of activities. When cost of taking loans get higher, then
employees have to use resources properly and budget set will be lower, hence activities has to be
conducted properly (Hatten, 2015).
In case of Hotel Hilton, there are many consumers arriving having difference in their
demand, so it is important to have complete information about them. In order to satisfy consumer
demand, decision of Food and Beverages sector services and planning gets changed. If there is
any legal and ethical law by government for restaurant sector, then it is essential for mangers of
Hotel Hilton to alter their decisions and conduct operations properly. Due to change in demand
of consumers, there is requirement of changing operations, hence training and development
programs are required for conducting activities properly because this is the best way to conduct
operations in proper and effective manner.
c) Top three risks companies face and how might this influence their decision making
There are some risk which affecting business operations in negative manner. There is
requirement of change in activities and decision making through which activities are performed
and conducted properly. In order to evaluate and determine changes properly, there is
requirement of change in business activities. Top three risk which is faced by H&M and Hotel
Hilton are as under-
Technological risk- These days, there is fast and frequent changes taking place in
technological sector such as arrival of new machines, updating new software, etc. with the help
of it, operations can be performed properly, but at the same time there is requirement of more
funds and risk is more. In H&M, there will more risk of non completion of targets because of
new machines. In Hotel Hilton, if accounts departments updates their software, then there will
issue to employees in conducting their regular work (Myers, 2019).
Operational risk- There is some specific brand image of H&M and Hotel Hilton in
industry, there will operational risk if consumers are not getting proper services. For instance:
quality of products offered by H&M are not specified, then sales and revenues gets down.
Managers of Hotel Hilton is not able to satisfy consumer demand, then operations of association
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is not good and appropriate. This affects activities in negative manner and consumers might shift
to other brand.
Financial risk- There is financial risk as well for the companies. This is one of the
biggest and major issue which is faced by association. If there is lack of funds, then scope of
organisational growth is low because management of H&M and Hotel Hilton can not plan future
activities and stakeholders are not satisfied because of financial services.
d) 3 suggestions regarding how the companies might improve their business practices
There are some ways through which risk can be reduced and operational performance of
Hotel Hilton and H&M will reduce (Noe, Hollenbeck, Gerhart & Wright, 2017). There is
requirement of change in activities because of dynamic environment. If policies of associations
are rigid, then it is tough to maintain long term existence in industry. 3 suggestions to deal with it
as under-
 There must be proper planning regarding financial requirement. Stakeholders must be
communicated properly regrading financial statements. In case of any major change,
corrective actions has to be taken.
 There must be employees engagement, hence in case of change in business activities,
they have complete information about completing the task. This gives positive impact on
operations because employees are motivated and give their best to accomplish tasks and
roles within specified time .
 There must be regular market analysis, so activities will be completed and performed
within specified time. Managers are able to take decisions properly because they have
knowledge about external market, hence there will less change in current working
performance of companies (Uhl & Gollenia, 2016).
CONCLUSION
From the above conducted study, it is clear that there are many external environment
factors which affects business operations. There are many factors which affects operations in
negative manner because of change in external market factors. Managers must have ability to
deal with financial, operational and technological changes which is possible with regular market
analysis. There is requirement of employees engagement through which operations are
conducted in proper and appropriate manner.
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REFERENCES
Books and Journals
Adekola, A., & Sergi, B. S. (2016). Global business management: A cross-cultural perspective.
Routledge.
Burns, P., & Dewhurst, J. (Eds.). (2016). Small business and entrepreneurship. Macmillan
International Higher Education.
Erasmus, B., Strydom, J. W., & Rudansky-Kloppers, S. (Eds.). (2016). Introduction to business
management. Oxford University Press Southern Africa.
Hatten, T. S. (2015). Small business management: Entrepreneurship and beyond. Nelson
Education.
Myers, M. D. (2019). Qualitative research in business and management. Sage Publications
Limited.
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill
Education.
Uhl, A., & Gollenia, L. A. (Eds.). (2016). A handbook of business transformation management
methodology. Routledge.
Online
Risk management. 2019. [Online]. Available through: <https://hmgroup.com/about-us/corporate-
governance/risk-management.html>.
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