Introduction to Business and Management

This document provides an introduction to the concepts of business and management. It covers topics such as external environment analysis, organisational structure, and financial performance. The document also compares the performance of two retail organisations, ASDA and TESCO. Study material and solved assignments on these topics are available on Desklib.

Introduction to
business and
management

Table of Contents
INTRODUCTION .........................................................................................................................3
External environment (PESTLE analysis)..................................................................................3
Organisational structure .............................................................................................................5
Financial and non-financial performance of both organisation..................................................6
Comparison of two firms & Conclusion.....................................................................................7
REFERENCES ...............................................................................................................................9

INTRODUCTION
Management is an act of getting people together in order to attain objectives and to make
effective use of available resources. In addition to this, it is the process of effective planning,
organising, direct as well as controlling all the activities so that the targets are met on time
period. On the other hand, business organisation is termed as structure which an organisation
follow in order to execute activities as well as operations in a systematic manner (Bozarth and
Handfield, 2016). In addition to this, business is designed with two main objectives that is
gaining of high profits and success at marketplace. It is important for the managers of an
organisation to conduct external analysis, market analysis, competitive analysis, internal analysis
before starting any of the business as it assist in developing effective strategies and dealing with
situations in a proper manner.
For the present report, ASDA and TESCO is taken into consideration. ASDA is a British
supermarket retailer which was established in the yea 1949 and its head office is located in
Leeds, UK. On the other side, TESCO is a multinational groceries & retailer supermarket which
was founded in year 1919 and headquarter in London, United Kingdom. The present report will
cover external analysis of respective organisation with the help of PEST analysis. In addition to
this, there is discussion about organisation structure of two chosen companies. Moreover,
financial as well as non-financial performance of company is elaborated. In the last, a conclusion
is developed in comparison of two retail organisation.
External environment (PESTLE analysis)
PESTLE analysis is defined as a framework that help company to gain knowledge about
the factors that impact on the business performance and operations of an organisation (Cassell,
Cunliffe and Grandy, 2017). In addition to this, it is a strategic planning tool that is adopted in
order to analyse the influence of macro environmental factors on business activities. PESTLE
analysis of TESCO and ASDA is given below:
Political factors
These factor consist the level of government intervention on business activities and
operations as well. It involve political stability, taxation rates and so on. These factors influence
on operations of both ASDA and TESCO. In relation to ASDA, national, international &
European union regulations impact on the employment, consumer rights, taxes impact business
operations. It is determined that political stability of UK is quite well which is beneficial for

ASDA. With reference to TESCO, it is a retailing organisation which operates globally and is
affect by political factors that is increase in employment rate of many countries directly affect on
its performance level.
Economical factors
It is stated that economic factors are the major concern of TESCO as it is associated with
the demand, leverage cost and price as well. Internationalisation as well as diversification are
two main factors which assist TESCO to gain success and growth at marketplace. In addition to
this, decline in the level of household income and disposable income, respective organisation is
emphasis on advertising of brand value & not of luxurious item offered by it (Giacosa,
Mazzoleni and Usai 2018). With reference to ASDA, it undertake economic factors such as pay
level, cost of credit, labour demand as well as supply, energy prices and many more. This all
impact on the performance & pricing strategy of ASDA.
Social factors
The social aspects on which ASDA emphasis are ageing population, celebrity following,
healthy lifestyle and so on. It is stated that understanding of these factors assist ASDA in
launching new products as well as service at marketplace. It also assist in developing
segmentation strategies that help in raising the performance in an appropriate manner. It is
determine that TESCO face major problems of customer's social behaviour. In the present time,
people are focused and concerned of their health and made respective organisation to emphasis
on organic food. This help company to fulfil customer requirement and gain success at
marketplace.
Technological factors
In the present time period, technology is changing rapidly and impact the buying
behaviour of customers as they prefer to consume those products which is new as well as
innovative at marketplace. In context to ASDA, it started selling its product online add also
develop its mobile application on which customers can order and get delivery at their door step.
If it is talking about TESCO, it develop a software that track the products purchase by customer
and generate billing rapidly. This decline the time taken by the employee for billing (King and
Brooks, 2016). All this assist both the companies to attract large number of people and sustain at
marketplace for longer time period.
Environmental factors

It is significant for an organisation to emphasis on environmental factors in order to
protect environment and maintain its image at marketplace. In relation to TESCO, it make use of
renewable resources & develop 100% of electricity by the year 2019. On the other side, ASDA
emphasis on various issues associated to carbon footprint, organic food, green economy and
many more. This help company to protect environment and maintain its brand image at
marketplace.
Legal factors
ASDA should abide by the various rules as well as regulations prevailing in the country
as it help in execution of activities without any interruptions and legal issues as well. In addition
to this, it is determined that it pay minimum wage to its staff members and ensure their safety at
workplace as well (Maylor, Blackmon and Huemann, 2016). In context to TESCO, it face legal
problems or issues for accounting misleading and fraud the investors of organisation. This
develop a negative influence on the stakeholders of company and decline its brand image at
marketplace.
Organisational structure
It refers to the hierarchical arrangements of various positions within company. It helps to
determine the job role and responsibilities of individuals in organisation. It is consider as a
system that is followed by an entity in order to undertake various business activities in
systematic manner. Here, information are floated from one person to another person to take
effective decisions. There are different types of organisational structure are used by different
companies in regards to their size, scope and other factors. With this, the job, duties are
determined of various person working within company that helps to minimize internal conflicts
and disputes. In addition, organisational stricture also determine reporting relationship between
individuals. It provides clarity that who is responsible for a particular task in order to achieve
predefined objectives.
In this regards, it is monitored that organisational structure and culture both are
interrelated with each other and crucial part of an organisation (Mendling, 2017). Diversify and
organised culture is essential for the growth and development of employees within company. It is
analysed that attitude, personality, behaviour of workforce are highly affected with culture
prevailing in entity. Performance of employees depends upon culture and internal environment
of organisation. There are various kind of organisational structure such as functional, divisional,

matrix, hybrid and more that are opt by managers as per the requirement and work environment
of company. In context of ASDA, it adopts functional organisational structure in which
different work is assigned to different individuals as per their capabilities and head is appointed
for each and every department to manage operations of respective division. It helps to enhance
skills and knowledge of employees and make them effective in particular task. On the another
side, it also leads lack of communication and interaction between different departments as all
individuals are responsible merely for their own respective division. Here, staff members work
separately as an individual they do not pay due attention to organisational objectives and goals.
They work with an objective to achieve desired goals for respective division (Morden,
2016Myers, 2019). To handle this kind of culture and maintain positive working condition
within company communal culture is essential to follow. It will help to create positive and
healthy environment at work place where all the employees can effectively communicate and
interact with each other. With this, organisation will be able to achieve its desired goals in
predefined period of time.
TESCO, follows hierarchical structure to manage large work force organisation in an
appropriate way. It is operating business at large level thus it is quite difficult for a single leader
to manage all business functions effectively. So, that respective entity is using Hierarchical
structure in order to run business in best possible way. There are 10 people included in Board of
Members of company as per the changes made in 2014-2015. John lewis has been appointed as
the new CEO of entity. Here, five committees are consisted in PLC board of entity. Therefore,
with this company is able to manage all its business activities in an appropriate manner.
Financial and non-financial performance of both organisation
TESCO generated a revenue of £53bn in UK and ROI last year which was 1.3 billion
more than the previous year. But it failed to secure it's market share from discounters Lidl and
Aldl and was left with 26.9 percent. As for this year the company saw a reduction in revenue by
1.84% but retained some of it's market share while the world faced a deadly pandemic
(Schaltegger, Burritt and Petersen, 2017). This success can be attributed to the corporates long
standing commitment towards technological advancements. The organisations ability to deliver
it's products through online channels and contactless devilry attracted customers as online
presence was necessary for every company during a pandemic. This surge in profit in the year
of a global pandemic is credited to it's possession of booker cash sand carry group and to further

give discounter corporates a tough competition the company has decided to minimise costs .
TESCO is all sell to sell it's supermarket chain in Thailand named TESCO lotus for £8bn to
Thailand based CP group which is series of failure in Asian markets after South Korea and japan.
This underperformance is because of the corporates inability to change it's plans according to the
countries and eliminate cultural differences This decision was made so that TESCO can focus on
it's UK operations. The organisation has expanded in India by forming a strategic alliance with
subsidiary of TATA group due to governments FDI relaxation. The firm has used technological
superiority and expertise to grow in the digital age.
Asda yielded a revenue close to 23bn after failing to merge with Sainsbury's in 2019.
Third quarter financial analysis of Asda this year shows a growth rate 2.7% and the company is
expecting more profit for the coming Christmas season. The organisation's diversification into
new areas such as Jewry pharmacy has opened new avenues for business(Sison, Beabout and
Ferrero, 2017) . The company's commitment to improving it's technology has lead to formation
of cheap loyalty program which has attracted new customers. The company is easily accessible
online and has expanded it's online presence and enhanced it's delivery positions from 450,000
to725,000 because of this the company ha seen steady growth.
Comparison of two firms & Conclusion
TESCO is one of the renowned retail organisation as stands on the fourth position as a
highest revenue in year 2019. On the other hand, ASDA was the most expensive supermarket
grocery basket of customers costs at an average of £143.36 – a hefty £16.33 and is less in
comparison of TESCO. It is concluded that from the outcome of independent shopping website
which average price of each product of TESCO is sell at less price than ASDA (Vom Brocke and
Mendling 2018). There are lot of problems faced by company in order to meet with customer
expectations & deal with behaviour of consumer. It is determine that TESCO is more profitable
in comparison with ASDA as it make use of diversification strategy.
Moreover, it has been concluded that TESCO and ASDA is functioning and operating in
retail sector and making high profits by offering quality services at marketplace. Furthermore,
technological advancements is adopt by both organisation that assist in providing quick and on
time deliveries which impact on productivity as well as profitability.

REFERENCES
Books and Journals
Bozarth, C.C. and Handfield, R.B., 2016. Introduction to operations and supply chain
management. Pearson.
Cassell, C., Cunliffe, A.L. and Grandy, G. eds., 2017. The SAGE handbook of qualitative
business and management research methods. Sage.
Giacosa, E., Mazzoleni, A. and Usai, A., 2018. Business process management (BPM). Business
Process Management Journal.
King, N. and Brooks, J.M., 2016. Template analysis for business and management students.
Sage.
Maylor, H., Blackmon, K. and Huemann, M., 2016. Researching business and management.
Macmillan International Higher Education.
Mendling, J., and et. al., 2017. Challenges of smart business process management: An
introduction to the special issue.
Morden, T., 2016. Principles of strategic management. Routledge.
Myers, M.D., 2019. Qualitative research in business and management. Sage Publications
Limited.
Schaltegger, S., Burritt, R. and Petersen, H., 2017. An introduction to corporate environmental
management: Striving for sustainability. Routledge.
Sison, A.J.G., Beabout, G.R. and Ferrero, I. eds., 2017. Handbook of virtue ethics in business
and management. New York: Springer.
Vom Brocke, J. and Mendling, J., 2018. Business process management cases. Digital innovation
and business transformation in practice.
Wilton, N., 2016. An introduction to human resource management. Sage.