Business and Business Environment

This document provides an overview of the different types of organizations, their size and scope, and the relationship between organizational functions. It also explores the positive and negative impacts of the macro environment on business operations, supported by specific examples. The chosen company for analysis is TESCO, a British multinational company.

Business and
Business
Environment

Table of Contents
INTRODUCTION......................................................................................................................3
MAIN BODY.............................................................................................................................3
PART 1 ......................................................................................................................................3
Different types of organisations.............................................................................................3
Explain the size and scope of a range of different types of organisations.............................5
Explain the relationship between different organisational functions and how they link to
organisational objectives and structure..................................................................................8
PART 2.......................................................................................................................................9
Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples...........................................................................9
Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses.....................................................................................................10
Explain how strength sand weaknesses interrelate with external macro factors .................11
CONCLUSION........................................................................................................................12
..................................................................................................................................................12
REFERENCES.........................................................................................................................13
..................................................................................................................................................14

INTRODUCTION
Business and business environment is defined the all the internal as well as external
factors that must be affected to the company and gives an impact in deciding decisions
related to their business function, employee, customers, supply and demand etc. It includes
everything related to the organisation type, nature, legal structure and many more things
(Akerkar, 2019). A perfect business environment help the company to sustain in the
environment and make profits. For this assignment the chosen company is TESCO, a British
multinational company. A biggest retail company in UK, headquarter in Welwyn Garden
City, United Kingdom. TESCO is founded in 1919, by Jack Cohen. In this assignment
different type of organisation and their interrelationship within the organisation are explained.
Furthermore the positive and negative impact of the company in the external environment
and swot analysis of the company which affect the internal and external environment of the
company.
MAIN BODY
PART 1
Different types of organisations
In the industry there are three type of organisation; public, private and voluntary
sectors and all these three sectors have different legal structure and purpose for the country
and the consumers. These explain below:
Public Organisation: public sector organisations involve the not-for-profit owned
government organisation which have basic function is the serve the people of the country. For
example NHS is the public sector organisation of the UK (Bozer, Levin and Santora, 2017).
Their focus is on supplying healthy services to their people and also providing good
infrastructure in the hospitals for getting good healthy life.
 Purpose: The public sector undertaking are the government owned bodies which has
main purpose is to serve the customers and government services to their people
including military, police, infrastructure and many more.
 Types: There are mainly three types of public undertakings in the industry they are
departmental undertaking, public corporation and Government Company. They are
explained below:
Government company: It is the comapny which 51% share's are acquried by the
givernment in ordre to make the profit for the development of the company.

Departmental understaking: It is one of the part of the government organisation and
they have no seperate existance other than government.
Public corporation: it is a statuary corporation made by the parlimament or any central
and state government for some special purpose.
 Legal Structure: NHS is the public organisation whose structure is same as public
corporation. As this company is whole captured by the government of UK.
Private Organsiation : Private Company is owned by the individual, group and partnership.
This type of companies owned by the both government undertaking and by the any private
body for making profit. For example TESCO is the multinational company of the UK which
has main motive is to earn the maximum profit (Baggio and Valeri, 2020). Has been seeking
to generate employee revenue more and more and obtain a competitive advantage for their
own.
 Purpose: They are the integral part of the country’s economic system which help the
economy to boost up by earning profit. They are also helpful in operating growth and
development and generating per capita income of the country.
 Types: In the private sectors the different types are; sole proprietors, partnership,
small organisation, private limited company, multinational company and franchises
etc.
Sole trade: It is the busienss which is operated by the single person, and take all the
responsibilities and profit on their own basis.
The partnership: Here two or more people are engage with the one deed and they
share the liablities and profit on their sharing ratio.
Private company: It has maximum 30 memebrs in the organisation and their main
motive is to earn the profit. They have limited liablities to share in between the board
of directors.
 Legal structure: TESCO is a multinational company which has diversified their
geographical and retailing focusing on the supermarket, hypermarket and other
convenient stores which provides lots of products together.
Voluntary Organisation: These are the bodies which are work for the social activities in the
environment and they are not for profit organisation and also they are not governmental

understating in the nature. The example of voluntary company is cancer research in UK.
Which has main motive to light up in the shed of social service by conducting the research
and campaign for prevention in the society (Bland and Osterwalder, 2019). Also spreading
awareness in the culture of the UK to limit the spreading diseases.
 Purpose: As being complies with the various organisations their main purpose is to
provide the benefits and enhancing the society at large scale without any concern of
earning profits. Furthermore they created social wealth and health improvement in the
society.
 Types: The different types of voluntary organisations are; trust, a limited company,
community Interest Company and industrial and provident society.
Trust: it is setup by the persons for the purpose of the wider community, they make
the formal relationship in between the donar and trustee.
A limited company: a comapny can choose by their own choice to make a volunatry
and community organisations. It is the methods which is used by most of the
companies.
Industrial and provident society: Ips is the orgnaisation which help the other wider
community. They rises the fund by share capital, but this take a differnt form to make
the limited comapnies in the market.
 Legal structure: the legal structure of the cancer research is non- governmental
funding company and it is an American cancer society.
Explain the size and scope of a range of different types of organisations
The size, scope and different ranges are explained for different types of organisation
which are explained below:
TESCO (private organisation): Tesco, is a third largest multi-retailer company in the terms
of gross revenue and having a ninth multinational company in the terms of revenue. Its CEO
is Ken Murphy, who is planning for expanding the business in the all over the world with
attending the highest revenue earning.
Products and services: Since 1960’s Tesco is diversifying their services in books,
groceries, F&F Clothing for men, women and children’s, club card services, bank facilities,
mobile servicing and many food items, furniture, internet services and many toys for the

children (Burger and Luke, 2017). And in many more servicing and product line they are
engaging themselves for expanding their business.
Size and Scope: Tesco is one of the largest retailer in the world having around 2318
stores and giving employment to the 3, 26,000 people in their company. It also gives online
services at their domain. Also they provide their services in four type of physical stores are
Extra stores, superstore, metro and express.
Vision: The vision of the Tesco is growing their business with using all opportunities,
having modern and innovative ideas, skills are applying globally and making the trust worthy
and loyal customers.
Mission: whatever they are making for the world must be make together for the better
growth of the world.
Objectives: The main objective of the company is to create the new opportunities for
millions of young and new generation, to improve the health of the people, helping in the
food waste resources, reduce the impact of their organisation on the environment.
Stakeholders: The main external stakeholders of the company are customers,
suppliers, creditors, competitors, local community and the government (Geng, 2018). The
internal stakeholders of the company are CEO, employees, co-workers and ground level staff.
NHS (Public sectors): The Company is founded in 1948, founded for the general taxation
but later on they are work for the A to Z health services and medicine delivered to the local
people of the UK and provide them general knowledge regarding the health care issues.
Product and services: They are providing the services and products related to the
health and safety measures.
Size and Scope: It is the biggest company which are offering the health care services
and approx. 1, 12,000 doctors, 3, 11,800 nursing staff and 35850 Managers who are handling
the team in the small units.
Vision: The vision of NHS, is to develop the strong partnership between the patients
and their clinicians that their combination will gives the positive impact to the health of the
people (Hill, 2018).

Mission: By practising the more in the health department by the employees will
provide the local people a healthy and safe life style with the integration and partnership
working.
Objectives: The main objective is to ensure that every child has the best starting of
their lives, reduce the inequalities in their health condition and improve the mental health and
wellbeing.
Stakeholders: The main stakeholders of the NHS are the local government and
foreign government, employees, the companies who are providing fund to the NHS, creditors
and financial institutions.
Cancer Research UK: This Company is formed in the 2004, by the merging of cancer
research campaign and imperial cancer research funds. With the main aim to reduce the
numbers of deaths due to cancer, and improve the situation in the worldwide.
Products and services: They are providing the cancer related services and health care
measures to control the death rates in UK due to cancer.
Scope and Size: It is the biggest cancer related voluntary organisation in the UK
which are serving all over the world and approx. 6058 employee in the organisation and near
about 80,000 volunteers.
Mission: The foremost mission is to accelerate the progress to beat the cancer as soon
as possible (Iyamu, 2020).
Vision: Their Vision is to see the people living their lives as free of cancer not as a
life threatening disease.
Objectives: Develop the platform to academic as well as community physicians to
collaborate, collect the needed information and do a research on that.
Stakeholders: The major stakeholders for the cancer research are the government and
the various local fund providers and also the owner and employees.
Explain the relationship between different organisational functions and how they link to
organisational objectives and structure
With the increasing risk and competition, the various organisational functions play an
important role in completing the organisational objectives (Neubauer and Lank, 2016). These
organisation structure will depend upon the business functions as the organisation make their

structure and objective according to their respective business functions which are they serve
to the customers. Therefore, getting effectiveness in the business organisational structure can
help the companies to achieve the objectives because it help the employee to know more
clearly about their job profile. They are explained further:
Marketing department: This department is one of the integral department of the
business organisation as they help the companies to maintain the relationship in between the
customers and other business of the market. This department is further responsible to make
the brand image in the market of the company and this department is deal with the other
department of the organisation also. Marketing department of the TESCO will relate to the all
other department as they have to deal with the customers directly.
Finance department: Finance department of the TESCO will help to arrange the
funds so that they can achieve the targets and objective of the company. Also they are facing
the legal obligations of the company and help the other department with proper finance so
that they can achieve the internal objectives of the company and help them to get the overall
success in the market.
Human Resource department: This department help the company to get the right
employee for the right position at the right time. In the TESCO, they are helping the other
department to employ the effective and efficient employee at the required position (Nkoroi,
Mutwiri and Njoroge, 2020). People who can utilised the organisation resources in the right
manner and help the company to get the desired objective and maintain the maximum profits.
Operations department: Operation department help the TESCO to completing the
demand of the customers in the market and also make the tough competition in the market.
And also they are always get connected with the research and development department to
always operate the new and innovative products and services to their valuable customers.
Sales Department: Sales department help the company to expand their business and
reach the products to the customers. They have the direct contact with the customers so in
TESCO they also complete the research work on the new demand of the customers. They get
the information from the market related to the new customers review and other competitor’s
strategies adopted by them to increase the market share. This will help the company
marketing department to plan according to that.

IT department: IT department help the company to deal with the technical issues and
faces the challenges occur time to time in the company (Rzemieniak, 2018). They also
manage the online customers and help the company to increase the market share in the digital
marketing. As TESCO is now providing their most of the products online also so their IT
team will help and manage the customers at online platform.
PART 2
Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples
For completing the external analysis, internal analysis is conducted for TESCO. For
this VRIO is conducted for knowing about the internal situation of the company. VRIO
shows the companies value, rare, Imitable and organisation nature of the company with
different prospective.
Resource capability Valuable Rare Imitable Organisation
Market reputation ✔ ✔ ✔ ✔
Leadership qualities ✔ ✔ ✔ -
Awareness of the
brand
✔ - ✔ ✔
High customer rating ✔ ✔ ✔ ✔
After analysing the company’s internal situation, the external environment analysis is
done by doing PESTEL analysis for the company to get to know the that how these market
factors affect positively and negatively on the internal environment to taking decisions.
Political factors: As Tesco operate globally so the global political factors will affect the
environment of Tesco. It included the tax rates, stability of government, legislation of the
actions etc (Tamhane, 2017). The positive impact of the political environment is to create the
job opportunities in all over the market which leads to increase in the demand and diversifies
the workforces. But the negative impact is the instability of the government which leads to
the increase in expenses of the company.
Economic factors: This factors is main point of the Tesco, as it related to the cost,
demand and profit of the company (Varmazyari and IMANI, 2017). Therefore the company
should be aware with the changes in the environmental policies which may affect the finance
of the company. The negative impact of economic environment is that the Tesco is still
dependent on the UK market. And the positive impact is internationalization and
diversification of the markets will help the company to get the success in the market.

Social factors: The changes happened in the customer taste and preferences that will
affect the company’s policy. Trends indicate the customers in UK as now the customers are
shifted to bulk shopping therefore the Tesco are shifted to non-food items in their company.
The positive impact is it will increase the sale of the company and increase the sustainable
growth of the company (Positive and Negative Influences of the Macro Environment, 2020).
But the reverse impact is every time completing the demand of customers will impact the
increase of expense of the company.
Technological factors: The positive impact of this shows that it gives the new and
innovative opportunities for Tesco. It also reduce the carbon foot print of the company. But
the negative impact is to high amount of investment is needed. These factors will affect the
company in a good way to improve the sale and increase the revenue from the use of digital
marketing.
Environmental factors: This will use for the work which is beneficial for the society
and the advantage is that they reduce the carbon copy of 50% and also decrease the negative
impact of the environment. Also they are minimizing the waste products to get the benefits to
the customers. The different use of customers and their changing environmental factors will
always considered by the company to highlight their environmental related changes and
improvement in the companies policies.
Legal factors: Government policies and laws are directly impact the company such
laws are anti-competitive impact, minimum wages and competition and market authority act
will affect the company sale a lot (Willcocks, 2020). The case file against the company by
their workers will gives the negative impact to the company and this will reduce the image of
the company.
Conduct internal and external analysis of specific organisations in order to identify strengths
and weaknesses
After conducting internal and external analysis of the Tesco their strength and
weakness are classified on the above analysis basis:
Strength: Tesco is providing the customers a wider range of the products and
services in the retail industry. Which directly help the company to increase the revenue by
applying the legal and political factors in their rules and regulations (Hamilton and Webster,
2018). And the major strength is the developing brand image in the worldwide markets. The
strength include the club card services provided by Tesco to their valuable customers.

Weakness: The instability of the local government and pressure of the other countries
government will increase the cost of the company and they become unable to follow all
regulation which leads to low management in the company. Operating different servicing line
in the one department is the biggest weakness to the company.
Opportunities: For Tesco the opportunities to expand their business and provide the
customers healthy and safe products according to their need will help the company to make a
better competitive advantage in the market. And the digital marketing is the biggest
opportunity to the company.
Threats: New market entry in the retail sectors will lead to the high global market
competition and also the fraud rates are increasing in the industry in respect of same products
with low price at low quality. While the other threat is increasing raw material cost by the
suppliers.
Explain how strength sand weaknesses interrelate with external macro factors
The social environment affected the company while completing the demand of the
customers at different time. Analysing the customer behaviour is the main mission of the
Tesco. And now-a-days Tesco is concerned for the healthy products and adopt the strategies
which less affect the environment. Social environment strategies effect the decision of the
company as it response to the changing customer’s life style (Hillary, 2017). While
technological environment also affect the sale of the Tesco as the customers can order their
products through online. So Tesco started providing the online services to their customers and
get review from them. This make the openness in between the customers and Tesco. This also
help the company to think in the right way.
Tesco cannot expand their business due to the economic and political environment.
These two environment are the main weakness of the company (Ivanova and Makhnyreva,
2017). The economic factors of the company would affect the more sale at retail stores and
these retail stores are affected by the political factors. So Tesco cannot take the advantage
from the economic environment but it increase the opportunities to expand the business in
global market.
CONCLUSION
From the above report it is concluded that the three different industry of the business:
public, private and voluntary, have their own organisational structure and legal strategies to
run the business. They have different mission and vision and also there organisational

function will help the company if they interrelate with each other. Furthermore for making
the perfect strategies in the business PESTEL and SWOT analysis is important to evaluate
about the advantage and disadvantage of the external analysis. Assignment explore the wide
range of the scope and size of the three sectors of business and analysing the company’s
micro and macro aspect individually.

REFERENCES
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