How Business Nature, Culture, and Environment Shape Business Organization

This article explores the importance of business nature, culture, and environment in shaping a business organization. It discusses the impact of PESTLE and SWOT analysis on Cadbury, a multinational corporation known for its high-quality confectionery products.

Business environment

Contents
Contents...........................................................................................................................................1
INTRODUCTION...........................................................................................................................2
TASK 1............................................................................................................................................2
Explanation of how business nature, culture and environment helps in shaping business
organization.................................................................................................................................2
PESTLE analysis.........................................................................................................................2
SWOT analysis............................................................................................................................2
CONCLUSION................................................................................................................................2
REFRENCES...................................................................................................................................2
1

INTRODUCTION
Business environment refers to those aspects of the surrounding of business organization
which affect or influence operation of business organizations and determine its
effectiveness. In other words it is the aggregate of all conditions, events and factors are
surrounded of an entity and directly and indirectly impact on it. Success of an enterprises
depends on the skills of mangers how effficineclt their analysis their environment conditions
and deal with it. Business environment play essential role for running business entity as all
the policies, strategies, plans and even vision and mission of a company decided on the basis
of the environment in which individuals run their business. In order to understand
importance of business culture, nature and their external and internal environment impact
Cadbury has been taken. In this report effect on business environment factors on Cadbury
organization has been analysis. This report has identified how economical and non
economical factors affected mangers of Cadbury to built their polices. It also consider how
natural limited. Weather conditions, social relation with customer, preferences of public
directly impact on sustainability rate of business organization.
Overview of Cadbury:
Cadbury is one of the most famous multinational business organizations of United
Kingdom. The company provides high quality of confectionery products to their customers.
It was founded by John Cadbury in 1824, the entity successfully maintain their position in
competitive market from last 196 years. Headquarter of Cadbury is situated in Uxbridge,
London. At present time market area of Cadbury is spread over 50 Asian, American and
European countries. Main customers base of Cadbury is India, America, Ireland, New
Zealand etc. Cadbury provides various types of bars, bags, boxes, beverage, and products to
their customers. Dairy milk, Oreo hot chocolate, milky bar, born vita, boost, goody bags are
some of most famous products of Cadbury. With the changes in times now the company also
provides, ice cream, desserts, and started special offer products related to Christmas, Dewali,
Halloween festival. The company is popular for their high quality of services.
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TASK 1
Explanation of how business nature, culture and environment helps in shaping business
organization
Meaning of business environment: The word is combination of 2 different words
business and environment. The term business refers as entities or organizations which are
engaged in industrial, commercial activites in order to provide products to their customers
to fulfil their demands. Environment is atmospheres within which a form survives or run
their business activities. Thus business environment encompasses all those factors that
affect a company’s operations, which can lead opportunities, threat of a firm, It considers
all factors and elements which directly and indirectly effect companies efficiency. Business
organization is divided into two parts, external environment and internal environment.
 Internal Environment: Theses includes all those elements which are controllable
and directly influence fire’s production capacity. It includes, organization policies,
structures, memorandum of association, workforce, premises in which it is situated,
financial capital etc. All these elements play essential role in an running
organization as without effective resource management policies business cannot be
achieved their goals (Petrescu, and Petrescu-Mag, 2016).
 External environment: Theses includes all those factors which are beyond the
control of mangers and which exist outside the organization. Due to beyond control
of the environment its success will depend to a very large extension its adaptability
to the environment. External environment future dived into 2 types of categories
which are mention below:
 Micro environment: The force which are close to the company and affect its
ability to work constitute is known as micro environment. It includes suppliers,
customers, financial institutions, creditors etc. It also known as operating
environment.
 Macro environment: It means general environment. Growth and survival of
business depend upon its adaptability to micro environment factors which consider,
economical environment, political environment, socio cultural environment, natural
environment etc. Economical and non economical are essential tool of macro
environment
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 Economical environment: It consist macro level factors related to means of
production and distribution of wealth in a country. These factors have significant
impact on the demand and supply of a business of an organization. These factors
also determine the feasibility of a country or a region for the conduct of a particular
business from financial perspective.
 Non economical factor: These factors include legal, natural. Political, international
environment of a business organization which promote, encourage directs and
control business activites (Saura, Palos-Sanchez, and Correia, 2019).
All these factors of business environment play essential role in formulating structure of
Cadbury. Management department of Cadbury built their marketing, financial and
investment strategies on the basis of their customers demand, preferences and nature of
their business environment. Behaviour of Cadbury organization is totally demand on
climate at which it is established and culture if their environment. Culture includes all the
attribute and moral rights followed by business organization. Cadbury is one of the most
famous corporations of United Kingdom their brand value also high and it is famous for
providing best qualities of series to their customer. In order to maintaining position and
image within the market their economical and non economical factors play vital role (Lu,
Wang and Xu, 2019). These factors help in building a strong position within the market. It
will help in shaping any business entity by formulating essential policies. culture, nature of
business is depends on their internal environment factors Cadbury is multination la
[organization thus their manger hire workforce from different countries although they
mange diversity in s very effective way and they take it as advantage, different countries
personals help in decision making process and suggest innovate idea for enhancing sales of
Cadbury. They introduced new features and new products of their chocolates to attract
their customers on the basis of analysing market demand of their customers.
Importance of business nature, culture and environment helps in shaping and enhancing
performance of Cadbury is describe below
 First mover advantage: Economical and non economical factors helps Cadbury to take
early opportunities of losing them from competitors. They now stating provides family
packs combo of chocolate products to their customers.
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 Early warning signal: Manager of Cadbury uses business environment techniques in
order to identify risk and future threat. Cadbury known about Britix agreement thus they
changes their polices before this deal. It will help them not to bear losses compare to their
rivalry industries.
 Customers Focus: Social environment help in identifying customer’s preference,
demands needs of their target market customers. Cadbury made strong relationship with
their customers, they formulate polices which attract and provides full satisfaction to their
relevant customers.
 Help in determining goals: Cadbury uses business environment factors to determine
their goal profitability level in different target market segment the company deals in
more then 50 country thus they need to set different goal for different target market as all
market have unique geographical situation (Sales and Beschorner, 2017).
 Formulating strategies: Nature of an enterprises will help in formulating strategies,
Cadbury deals with confectionery goods and services to their customers thus they
implement business strategies according to preferences’ of their customers. In India Dairy
milk , Born vita products are sell at higher rate, In New Zealand beverage products are
sell compare to other products thus they formulate strategies according to the nature and
culture of business market.
 Public image: Success of an entity depends on the image and brand value among public
of the company. Brand value of Cadbury is high it is also the ain reason that the company
earn more profit from outside their country.
 Change agent: Toda’s world is dynamic preferences and technologies changes within
few times thus factors of economical and non economical environment help in provide
sustainability to Cadbury. Management department of this company after analysing their
external environment always ready to adopt and accept their customers demand and
introduced new products, feature packaging technique in order to attract their customers
and maintain their position in economy.
 Continuous learning: Political parties, competitors, geographical demographical,
technologies, legal all the factors positively and negatively impact on business’s life
cycle. Cadbury suffers from many problems and their growth rate also goes down due to
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Bretix agreement and now for trade war among US and China but the company uses new
technologies and uses it in order to increase their growth eat, attract their customer.
 Giving direction to growth: Various factors of non economical and economical
environment will help in gives direction to enhance growth and achieve organization
goal. Manger of Cadbury formulate various polices, they uses social medial, and advance
technologies in order to attract their target market customers. At present Cadbury se
various slogan, which becomes popular among public these will help in maintain their
position and creating strong and positive e value between customer.
Cadbury is multinational corporation and it has wider market are, their rivalry companies is
also strong and with effect of globalization rate of competition will be increase to attain
sustainability in market environment they uses economical and non economical
environment factors it will help them to innovate new products and maintain strong
position in market.
To identify opportunities, threat, risk factors in business environment manger of Cadbury
uses environment scanning technique. Theses technique is used for the purpose of scanning
all the determination of external environment. Following are the techniques used by
manger of Cadbury to scan their business environment(Lam and Wong, 2018).
PESTLE analysis:
PESTLE amylases is a technique of environment scanning which is used to identify impact
of economical factor on business organization. This framework helps in tracking business
environment activites. Manger uses this tool in order to identify their risk factor of
introducing new products and services in market. PESTLE analysis of Cadbury has been
describe as follow:
 Political factors: Theses are most essential factors which directly affect the
business organization. Political factors includes all polices, rules impose by
government, tax policies, fiscal policies, budget polices monetary policies adopted
by government. These factors help to identify the extent by which a government
influence business organization. Effect of political factors on Cadbury is describe
follow:
 Positive impact: Cadbury sell their products in India, and other Asian countries,
most of government reduce their tax rate on Cadbury products.
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 Negative impact: Due to brexit agreement market area of Cadbury has been
reduces, they pay tax on selling their products in other European countries now, higher rate of
sugar tax also decrease profitability rate on Cadbury.
 Economical factors: It includes interest rat, growth rate, industry life cycle stage,
inflation rate, GDP rate of country, foreign exchange rate etc. Economical factors
are thoes factors which determine the profitability and sustainability rate of an
organization within the market environment.
 Positive impact: Interest rate of providing loans is low which will help Cadbury to
take loan from financial institution easily.
 Negative impact: Due to low value of pound Kraft company purchases shares of
Cadbury at low price, as compare to there original value it will impact directly on
earning of the company (Nayak, and Mohanty, 2017).
 Social factors: It also known as socio-cultural factors. These factor includes,
demographics, customers relation with organization, brand value, goodwill among
public, etc. Socio factors showcase preferences and attitude of public towards the
business organization.
 Positive impact: Brand value of Cadbury is high it will help this company to
launching new product in market as they did not need to incurred expenses on
searching or attracting customers.
 Negative impact: It becomes really hard for this organization to fulfil changing
demands of customers.
 Technological factor: Innovation of new products, process, features uses of
various technologies, etc. Technological factors directly impact on a company as
this will effect management procedure of the company.
 Positive: With advancement of technology, Cadbury uses digital media to promote
their products at wider area. It will also help in cut throat additional cost of
promotional activites.
 Negative impact: Rivalry industries uses technologies as their tool of competitive
advantage.
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 Legal factor: These factors determine how effectively ethical rights, customer’s
law, act of parliaments, impact on business organization. To maintain position in
market it is necessary for an organization to imply with their legal policies.
 Positive: The Company get tax benefits and other advantage and schemes started
by government of United Kingdom as they always implies legal policies.
 Negative impact: Legal compliances has been increase to sell products of Cadbury
due to brexit agreement in European union countries (Sharafutdinova and
Steinbuks, 2017).
 Environment factor: It included all the factors which are surrounded to a business
entity. It determine how effectively climate changes, geographical factors, weather
condition, natural resources impact on business life cycle.
 Positive: Weather and climate conditional always in favour of Cadbury
organization.
 Negative: The Company uses organic or manufacturing green and black chocolate
are reduces due to increase of manufactures of using these products.
SWOT analysis: It is the strategic planning method used to evaluate the strength, weakness,
opportunities, and threat involved in project or in business organization. This technique is
used to identify the best possible ways which help in minimizing cost and maximizing
profit in order to maintain strong position in market environment. Component of SWOT is
mention below:
 Strength: It is a distinctive competence that gives business organization a comparative
advantage in market place.
 Weakness: It is a limitation or deficiency in resource, skills, and capabilities that seriously
impact effectiveness of business performance.
 Opportunity: It is major favourable situation in business environment.
 Threat: It is unfavourable situation in the business organization environment. It is key
impediment to the firms’ current or desired future position.
SWOT analysis of Cadbury
Strength
 Cadbury is successfully run their
business in UK market since 1824
Weakness
 Cadbury provides high rate of
products to their customers which is
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thus it has maintain strong brand
value and familiarity and loyalty
among public.
 Sales volume of Cadbury is very high
their market segment wider area and
they provides various of unique
quality of product of their customers.
out of range for low society of
people.
 Issue of diversity is always arise
within the preemies’ of Cadbury
(Yang, 2017).
Opportunity
 With the effect of globalization
Cadbury has great chances to explore
their business in African countries by
using digital media platform.
 They can increase their sale volume
by providing various offers on
festival and occasion season in India
and other countries.
Threat
 Due to times changes competition
rate is increase now Nestle and Amul
give toughest competition to
Cadbury.
 People person becomes more heath
conscious and due to Corona and
other virus problem rate of buying
chocolate and milk products are
decrease.
Findings: After overall analysis it was founded that factors that made business environment
are play vital regarding business. Even an individual have adequate capacity of financial, or
perfect combination of production factors they only attain success when they properly
understand concept of economical and non economical factors and work according to these
factor, They should company with all the legal policies and they built plans which attract
and satisfy their customers for this purpose they need to analysis their natural, political, legal
factor of the running business organization.
CONCLUSION
From the above analysis it has been concluded that macro environment factors has directly
impact on the profitability rate of business organization. These are factors which can be built
an organization and can be destroy the business enterprises. Macro environment includes all
the economical and non economical factors which consider, natural, demographical,
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population, preference, demand of customer, brand value image, political, legal, policies of
an country influences on running business organization. It totally depends on the skills of
management department of an enterprises how well they uses their environment scanning
technique in order to identify upcoming, strength, threat, opportunities and risk elements of
their business environment. Managers use various environment scanning tools to identify
essential factors of business entity. They use PESTLE and SWOT framework for this
purpose. After identify all the risk and opportunity element, they formulate policies and
take decision related which help in achieving business goals by optimum utilization of
resources.
REFRENCES
From books and journal
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Petrescu, D. C. and Petrescu-Mag, R. M., 2016. Propensity to negotiate: business vs
environment. Calitatea, 17(S1). p.138.
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of Intelligent Manufacturing.pp.1-12.
Saura, J. R., Palos-Sanchez, P. R. and Correia, M. B., 2019. Digital marketing strategies based
on the e-business model: Literature review and future directions. In Organizational
Transformation and Managing Innovation in the Fourth Industrial Revolution (pp. 86-
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Lu, Y., Wang, H. and Xu, X., 2019. ManuService ontology: A product data model for service-
oriented business interactions in a cloud manufacturing environment. Journal of
Intelligent Manufacturing, 30(1). pp.317-334.
Sales, A. and Beschorner, T., 2017. Societal Transformation and Business Ethics: The Expansion
of the Private Sector and its Consequences 1. In The moralization of the markets (pp.
227-254). Routledge.
Lam, J.S.L. and Wong, H.N., 2018. Analysing business models of liner shipping
companies. International Journal of Shipping and Transport Logistics, 10(2). pp.237-
256.
Nayak, S. and Mohanty, V., 2017. Green HRM for business sustainability. Indian Journal of
Scientific Research, pp.102-106.
Sharafutdinova, G. and Steinbuks, J., 2017. Governors matter: A comparative study of state–
business relations in Russia's regions. Economics of transition, 25(3).pp.471-493.
Yang, J. S., 2017. The governance environment and innovative SMEs. Small Business
Economics, 48(3). pp.525-541.
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12

INTRODUCTION
TASK 1
Explanation of how business nature, culture and environment helps in shaping business
organization
PESTLE analysis
SWOT analysis
CONCLUSION
REFRENCES
13