Macro Environmental Influence

This document discusses the influence of macro environment on companies' operations. It explores different types of organisations and their purposes, as well as the size and scope of these organisations. The document also explains the relationship between different organisational functions and their interrelation with organisational objectives and structures. Additionally, it identifies the positive and negative impacts of macro environment on companies' operations.

Macro Environmental
Influence

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types of organisations and their purposes..............................................................1
P2 Explanation of size and scope of different types of organisation..........................................2
TASK 2............................................................................................................................................4
P3 Explanation of relationship between different organisational functions and interrelation
with organisational objectives and structures.............................................................................4
TASK 3............................................................................................................................................7
P4 Identification of the positive and negative impacts of macro environment on companies
operations....................................................................................................................................7
TASK 4............................................................................................................................................9
P5 Explanation of internal and external analysis of organisation and identification of
strength's and weaknesses...........................................................................................................9
P6 Explanation of interrelation of strength's and weaknesses of organisation with external
factors of macro-environment...................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment of any business involves all the internal and external factors like
employees, supply and demand, clients, consumers needs and expectations, suppliers,
government activities, technological advancement, market trends, etc. These factors affects the
functioning of a business directly or indirectly (Alaloul, Liew and Zawawi, 2017). The
organisation selected for this report is Dyson Ltd. It was founded by James Dyson in 1991 and
headquarter of the company is situated in Wiltshire, England. The company mainly deals with
products like vacuum cleaners, desk fans, hand dryers, hair dryers and air purifiers. The topics
covered in report are different types and purposes of organisations in different sectors with their
size, scope, legal structures. The report also focuses on relationship between different
organisational functions and its link with organisational objectives. In addition to this positive
and negative impact of macro environment on business operations and the internal external
analysis of company is done in report in order to identify the strength's and weaknesses of
company.
TASK 1
P1 Different types of organisations and their purposes
An organisation is a place where a group work together which may be known as a
charity, a union or a corporation. It also refers to a system which arranges or organises things.
The different types of organisations are as follows-
Private Sector organisations: These type of organisations are run by or controlled by
the individuals and companies to earn profits and they are not controlled by state authorities
(Fleming, Lynch and Kelliher, 2016). For example Dyson Ltd which was founded by James
Dyson has a motive to earn profits with sales of products like hand dryers, hair dryers etc.
 Purpose: Dyson Ltd wants to inspire the new generation of engineers. By reducing
harmful emissions it provides materials, mentorship and money to young engineers so
that they can get hands-on with problems and learn how to solve them.
 Legal Structure: Private sector organisations mainly as sole trader, one-person business
with small amount of finance; partnership association of two or more individuals who are
known as partners; private limited company small businesses owned by shareholders.
Dyson Ltd fall is private limited legal structure amongst all other structures.
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Public Sector organisations: These organisations are part of country's economy which
are effectively controlled by the government which provide goods and services for the benefit of
general public (Gandhi, 2017). For example, British Broadcasting Corporation (BBC) founded
by HM Government on 1st January 1927 doing the broadcasting all over the world.
 Purpose: There are many purpose of BBC, one of them is to provide impartial
information or news which makes people understand and creates engagement within the
activities around the world.
 Legal Structure: There are two types of legal structure for public sector organisations
which public corporations and general government which involves central, state and local
government. BBC falls in the category of public corporations legal structure of public
sector organisations.
Voluntary Sector organisations: The primary motive of these kind of organisation is to
create social impact of any issue rather then to earn profits. For example, Oxfam which was
founded at Oxford, England in 1942 and works for human rights.
 Purpose: The aim of Oxfam is to work towards rights based approaches. It recognizes
the indivisibility of human rights and aims to express them in practical manner.
 Legal Structure: The legal structure of voluntary sector organisation are a trust which
are set upped to manage money with defined purpose, an unincorporated association deal
for small group of people with membership, and limited companies (Hofmann, 2019).
The legal structure of Oxfam is charitable incorporated organisation. Apart from this
legal structure of voluntary sector organisation are trusts, unincorporated associations,
company limited by guarantee.
P2 Explanation of size and scope of different types of organisation
Basis Dyson Ltd BBC Oxfam
Size The organisation has
Dyson machines over
65 countries which as
grown from one man
and one idea to a
technological
Being a broadcasting
organisation it has
reach all over world
with approximately
22,401 employees
working for the
It is an organisation
with massive reach for
which over 10,000
employees and 20,000
volunteers work to
fight for human rights.
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company with 1000
engineers worldwide.
company.
Scope The scope of Dyson
Ltd is wide because
has products which are
used by people all
across the world
(Krajnakova, Navickas
and Kontautiene,
2018).
BBC has wide scope
because broadcasting
has connectivity with
different people from
different countries and
information provided
by the company is
understandable by
every person.
As the organisation as
global presence to
motivate people to
fight for their rights
the scope is quite wide
for Oxfam.
Objectives To inspire the new
generation of
engineers and make
the products which can
solve some problem of
pollution are the
objectives of Dyson
Ltd.
The objective of BBC
is to act according to
the public interest,
serve its audiences
with provision of
impartial and high
quality content.
Oxfam works with an
objective to create
solutions for injustice
of poverty. Being a
global organisation
they want to secure
future of people.
Products and Services The products which
Dyson Ltd provides to
its consumers are
vacuum cleaners, desk
fans, hand dryers, hair
dryers and air
purifiers.
BBC provides the
services of
broadcasting on
television, radio
stations and on its
official website. Apart
from this BBC Studio
is one of its
commercial ventures.
The services that
Oxfam provides is to
help the people fight
for their human rights
and poverty the people
are facing in different
parts of globe.
Organisational Dyson Ltd falls in BBC works on Oxfam has flat
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Structure matrix organisational
structure. The
employee’s in this
structure are matrix's
across different
divisions,
superiors,and
departments.
divisional
organisational
structure (Lim, 2018).
It follows divisional
structure because
company has group in
which people work
according to different
products, mainly
divided into small
regions.
organisational
structure. In the
companies were
decentralized work is
done were each
employees are boss of
themselves those
organisations opt the
flat organisational
structure.
TASK 2
P3 Explanation of relationship between different organisational functions and interrelation with
organisational objectives and structures.
Dyson Ltd mainly focuses on providing home appliances like air purifiers, fans , heaters,
hand dryers, vacuum cleaners, and hair stylers. The main objective of company is to increase its
market share and profits for which the goal is to provide products which makes life easier of
consumers and make household work less bothering by improving its products.
Organisational structure: The structures which define entire culture of an organisation,
structure which influences productivity in company, employee’s relations and marketing
strategies all this things come in organisational structure (Löbbers, von Hoffen and Becker,
2017). There are different types of organisational structures which can be discussed as follows:
 Functional Structure- The most common structure implemented is functional structure
which is also known as bureaucratic organisational structure, which means breaking the
work according to specialization of workforce. In this act the company is divided into
different department mainly in marketing, sales and operations.
 Divisional Structure- The second most common structure which is mainly used in large
companies which have many business units, divisional organisational structure. The
companies which have leadership team based on projects, products or subsidiaries uses
this structure.
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 Matrix Structure- Combination of functional and divisional structure is known as
matrix organisational structure (Mawejje and Okumu, 2016). This type of companies take
lots of planning to make appropriate plan for large company that has devoted its
resources in managing complex businesses.
Dyson Ltd has matrix organisational structure because the company wants its employee’s
to give more autonomy and are expected to more responsibilities towards their work. This
angularities the productivity of whole team and adoptive innovation and creativity is seen in
their work.
Organisational functions: Any business or company exists to provide goods and
services that consumers has desire for, need to produce these goods and services organisations
require resources. And these resources are arranged from the functions on which company is
running. The following are some functions which can used individually and can be inter-related
with other functions as well as with the objective and structure of an organisation.
 Finance Function- This function plays an important for any company, through this
function the records of money received and paid by organisation are maintained. The role
of this function in Dyson Ltd is to ensure that the funds are distributed equally to all the
departments. The interrelation of this functions with the other functions also necessary to
be maintained. The activities planned in marketing function are supported by financial
function as the funds for the completion of activities as allocated by finance function. The
relation of finance function with the matrix organisational structure can complicate the
situation for company because funds are transferred to top level managers and they are
the one who decides were funds as to be allocated. To fulfil the objective of Dyson Ltd
this function allocates the funds to all departments of company in proper manner to
provide quality goods in market which helps in attaining more profits to company.
 Marketing Function- Production of goods and services is not only the function which
goals of company, marketing function needs to help the producer by transferring them to
the end consumers (Mohammed, Gururajan and Hafeez-Baig, 2017). Marketing function
plays most important role for Dyson Ltd because to attract a large scale of consumers at
international level the strategies of marketing as to be accurate enough. The interrelation
of marketing function with research and development is to provide the data of sales of the
various products in which company is leading and what all things are demanded by
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consumers in market. The relation of this function with matrix organisational structure
varies upon the situations faced by the company as demand and supply of products are
depended on consumers only. Marketing function helps Dyson Ltd achieve its objective
by implementing right technique of promoting capturing large market areas.
 Research and Development Function- This function is responsible to innovate new
products which are either in demand by consumers in market or can create demand for
products new products provided to market by the company (Osmonbekov and Johnston,
2018). The function has been the key to success of Dyson Ltd as there motive is to invent
the products which have high quality and safes time of people in day to day activities.
This function interrelates with marketing function by providing information of marketing
strategies that can be used for effective promotion of products provided by company. The
relation of this function with matrix structure of Dyson Ltd lets the researched work
circulated in different departments of company. This function researches in market and
develops products for Dyson Ltd for successful achievement of objective set by company
and also improves the quality of products which helps in capturing new market share.
Advantages of interrelation between the functions: When functions of organisation
have good interrelation the operational speed of company increases, this happens because a
senior person handles problems faster then anyone with less experience. The operations have
clarities as the tasks are divided in different parts with which duplication of work and resources
is reduced. The interrelation between functions helps employee's in becoming specialized with
the work they are doing which makes there work effective for company. Team members from
other team share thoughts and knowledge which helps people in learning new skills.
Disadvantages of interrelation between the functions:
The people in different functions are grouped according to their skills and knowledge which
makes the team operate with coordination but the level of bureaucracy and business strategies
make it difficult for them to respond the changes immediately. Sometimes lack of unit
coordination can be seen when functions are performing with high level of efficiency however,
they have difficulty while working with each other by which coordination is compromised. At
some functions employee's are not motivated which affects the innovation level of employee's
and restricts views of goals of organisation.
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TASK 3
P4 Identification of the positive and negative impacts of macro environment on companies
operations
Macro environment: The collection of all factors or conditions which has the capacity to
influence the business operations in positive and negative manner (Rishi and Sharma, 2017). The
factors like plans and polices of company, human resources, plant and machinery and all other
factors which company has within its environment are internal factors. The factors that are
external to the company and according to these factors sometimes firm has to change its terms
and polices are external factors. To analysis external factors and its positive and negative impacts
Dyson Ltd uses pestle analysis.
PESTLE analysis: A business firm is affected by both micro and macro factors in its
external environment and the fact states that these factors can not be controlled by the
organization. So to measure and analysis external factors PESTEL Analysis is done by the firm.
This tool helps the companies have the foot views of the macro environment in which the
company is operating. This technique also helps keep the track of all the changes happening in
the environment.
Political: This factor relates to the government intervenes in the economy. This factor
involves the tax policy,environmental law, labour law, trade restrictions, tariffs and political
stability (Rittenburg, Gladney and Stephenson, 2016). Dyson Ltd has a critical impact of these
factors as it has presence of its brand in international market.
 Positive impact: UK is the local market were the laws have been very easy for Dyson
Ltd usually the political laws do not affects company's business in UK.
 Negative impact: It is little difficult for Dyson Ltd to operate in other countries due to
high exchange rates, unstable government regulations, import restrictions and many such
things affects the international business which results decline in the sales of products in
those countries.
Economical: In this factor the exchange rate, inflation rate, interest rates and the
economic growth rates are involved. It reflects to the influence of the economic conditions on the
Dyson Ltd and their remote environment.
 Positive impact: Due to high economic growth rate Singapore, Dyson Ltd has expanded
its market very well in Singapore and its sales have increased in recent times.
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 Negative impact: After the increase in inflation rates in has North Korea has affected the
sales Dyson because the buying power of consumer's has been reduced, so the market of
company has been affected badly.
Social/ Socio-cultural: The cultural aspects, the health consciousness, the age
distribution, career attitudes , the population growth rate and safety measures of Dyson Ltd are
the aspects which are involved in this factors.
 Positive impact: Looking at today's era every person wants to save time and wants the
work to be done with less efforts, and to fulfil this kind of demands the products of
Dyson Ltd are designed. The company's products matches with people's lifestyles with
great quality which increases sales of products.
 Negative impact: Being an innovative brand, the people who have attain some age do
not prefer the products manufactured by Dyson Ltd as they require proper understanding
for using the products.
Technological: The technological aspects like the automation, R&D activities,
technology incentives and the rate of technological change, all this aspects come under the
Technological factors for the Dyson Ltd.
 Positive impact: Dyson Ltd is known for its innovative technology used in products and
company always keeps on adapting new technological updates which makes the brand to
be ahead of of its competitors.
 Negative impact: Innovative technology requires lots of research and man power for
which huge amount of funds are required for which company has to charge little high
prices from its consumer's to cover its cost of production.
Environmental: The ecological and environment aspects like weather ,climate change
or the events which happen in the nature are involved in the Environmental factors (Šoltés and
Štofková, 2016).
 Positive impact: Dyson Ltd invests in projects which involves ecological investments
and creates awareness amongst people about those activities as now a days people wants
companies to play their roles effectively in saving the environment also.
 Negative impact: If the environmental laws are not followed by company it would
effect the reputation of company in the market which will affect the sales of its product
and profits will not be attained by company.
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Legal: The factors which lets the organization to know how to operate , its costs and the
demand for its products are the Legal factors (Venkatesh, Mathew and Singhal, 2019). The
discrimination law, antitrust law, consumer law, employment law and the health and safety law
are some of the measures of this factor which are also focused by Dyson Ltd.
 Positive impact: Following all the rules and regulations of countries helps Dyson Ltd
conduct its businesses and also helps in building the brand image in different countries.
 Negative impact: Not following the consumer law, employment law creates bad image
in the market which indirectly affects the sales of company.
TASK 4
P5 Explanation of internal and external analysis of organisation and identification of strength's
and weaknesses
SWOT Analysis also known as SWOT matrix is a strategic planning technique is used to
help the organization identify its Strengths, Weaknesses, Opportunities and Threats to the
organization (Rialp-Criado and Komochkova, 2017). This technique, which operates for 'peeling
back the layers of the organization' is designed for decision-making processes at preliminary
levels and can be operated as a tool to evaluate the strategic position of the organization. Dyson
Ltd uses SWOT analysis to factors ot conditions which can effect the business of company.
Strengths Weaknesses
 Innovative Products- The designs and
product quality unique and Dyson Ltd
has the image of innovative products
with great technology in markets of
every countries in which it operates.
 Research and development- The
company has great R&D team who
focuses on every angle of research and
then designs and develops the products
in the headquarters or the brand.
 High Prices- This is a biggest
weakness of the company because the
prices of products are high as compared
to its competitors which can result in
loss of customer base.
 Legal Proceedings and
Controversies- Company has been in
lawsuit with Amway, Vax, Samsung
and other companies which as created
controversies for company and has
spoiled companies reputation.
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Opportunities Threats
 Online Presences- Dyson Ltd provides
products which can be purchased online
as it has tie-ups with multiple retailers.
 Enhancing features of products- The
features of products can be enhanced to
meetup the customer's requirements
which will provide great experience to
its consumers.
 Wavering in Market of UK- The
fluctuation of Housing market in UK
has always been a threat to Dyson Ltd.
 Availability of cheaper products-
The products which are provided by the
competitors at cheap price or quality
can affect the sale of company(Russo
and Confente, 2017).
P6 Explanation of interrelation of strength's and weaknesses of organisation with external factors
of macro-environment.
The macro-environment factors which are external to the company are affected by the
strength's and weaknesses of company. The interrelation of these factors with strength's and
weaknesses are discussed as follows-
Strengths: The innovative products produced by Dyson Ltd are one of the strength's of
the company which are affected by social/ socio-cultural factor of the company as it focuses on
health consciousness, the age distribution, and safety measures taken by people in this era.
Advanced research and development team strengthens the technological factors of company
were the motive of company needs to adopt the technological changes to compete with
competitors in market. Dyson Ltd captures the market with innovative products by which the
economical factors of company has increased and has helped to grow its market in Singapore.
Weaknesses: Providing products on high prices is one of the weaknesses which has been
affected by political factors of company because in some countries the laws are not so strict for
company and in some countries law are strict due to which company has to make price changes.
Legal proceedings and controversies have been faced by Dyson Ltd were have the company sued
other companies which as affected the legal functions of company due to not following the law
company reputation is in risk.
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CONCLUSION
From the above report it has been concluded that business environment comprises all
those activities which are external and internal to the organisation. The different types of
organisations which are private, public and voluntary have different size, scope and legal
structures. The interrelation between organisational functions like finance, marketing and
research and development function have link with objective and structure of organisation. There
are some positive as well as negative impacts of the macro-environment on the political,
economical, social, technological, environmental, and legal factors of the company. The
strength's and weaknesses of company are analysed by swot analysis, these strength's and
weaknesses have interrelation with the external macro factors.
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Venkatesh, R., Mathew, L. and Singhal, T. K., 2019. Imperatives of business models and digital
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