Business Environment Analysis

This assignment requires a comprehensive analysis of the business environment using PESTLE factors. Students will evaluate how different business models (e.g., innovative business model canvas) impact profitability and sustainability. The role of Human Resource Business Partners in shaping successful business environments will also be examined, considering the influence of knowledge economies and international business contexts.

The Business Environment

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Type of business purpose and relationship of two contrasting business................................3
P2 Stakeholders influence on purpose of two contrasting businesses.........................................4
TASK 2............................................................................................................................................6
P3 How two businesses are organised.........................................................................................6
P4 How style of organisation helps them to fulfil their purpose.................................................7
TASK 3............................................................................................................................................8
P5 Influence of two contrasting economic environment on business activities of selected
organisational...............................................................................................................................8
TASK 4............................................................................................................................................9
P6 Impact of political, legal, social factors on business activities of selected organisation and
stakeholders.................................................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment is sum total of all individual, institutions and other forces that are
outside the control of enterprise but the business still depends on them as it affects performance
and sustainability of business of two contrasting businesses one is non-profit 'OXFAM 'and
profit organisation 'Tesco'. This report will underline types of business purpose and their
relationship with two contrasting business. It will discuss stakeholders influence on these
businesses. Further, this report will underline how two businesses are organised by comparing
functions with its organisational structure. This assignment will describe that how structure of
company helps this firm to achieve their purposes. On the other hand, it will outline the impact
of economic environment on this firm and also includes under its purview effects of legal, social,
technical factors of these businesses through use of analytical tool 'pestle'.
TASK 1
P1 Type of business purpose and relationship of two contrasting business.
Non-Profit Business (OXFAM)
Non-profit organisation works with motive of serving social welfare where focus is
serving benefit to society. Key aspects of non-profit organisation are trustworthiness, honesty to
every person of society who have invested in organisation. Main aim of non-profit firm is to
analyse problems and suffering of society to enable solution for support. This non-profit
company is owned by governmental organisations or trustees of different countries. Oxfam is
non-profit organisation formed with 20 charitable organisations with the motive of removing of
poverty and helping people to fight with injustice and lack of resources (Hair and et.al., 2015).
This company focuses on key areas of development of work which deals with lifting out
communities from poverty. Humanitarian work which focuses on taking care of natural disaster
affected peoples from calamities. This organisation has improved its functions and is now
focusing on eliminating poverty. now to alleviate poverty from. Oxfam is public sector company
works for the community and society benefits This firm is working without any objective for
money for earning profit and are only focused on benefits of society and public and provide them
with fruitful solutions to eradicate poverty by motivating them to stand up for their own rights
(Hunter, Saunders and Constance, 2016.).
Oxfam is limited liability firm means its members are limitedly liable for company's
debts and their liability. Firm is an international organisation with 14 organisations who are

trustees of the firm works in 98 countries. 'Winnie Byanyima' is executive director of OXFAM
non-profit organisation ant this company is very well managed by their trustees. Debt in this
company took place in 1970s and1980s which created a huge loss for the company and forces the
firm to overcome their debts through inviting public spending to balance debts of the company to
recover some drawbacks and come back to the stable situation. This company is limited liability
means members of this company are liable for its debts and liabilities (Zolnowski, Weiß and
Böhmann, 2014,).
Private Business (Tesco)
Private organisations run with the motive of earning profit with increasing workforce and
comfortable working environment. This companies do not bother about the well-being or welfare
of society they just target is to increase productivity and brand image of company to increase
profits of the company. This profit-based companies are owned either by non-governmental
organisations or small number of shareholders company members (Wheelen and.et.al., 2017).
TESCO which is private based company. It is multinational groceries and general
merchandise retailer headquartered in England United Kingdom. It is third largest retailer in
world measured by gross revenues and ninth largest as measured by revenues. This company has
diversified in the areas of retailing of groceries, books, clothing, electronics and furniture. Tesco
is public limited company as its shares are with different shareholders but ownership of firm is
private means it is privately owned company. This company is liable towards its customers to
satisfy them by providing quality products and increase customer loyalty. This company have to
buy back 700 of its debt as retailer tries to strengthen its balance sheet and will regain its
investment status. Tesco is a private Limited organization.
P2 Stakeholders influence on purpose of two contrasting businesses
Private Business (Tesco)
 Mission: TESCO mission is to create value for the customers to earn their lifetime
loyalty of customers.
 Vision: This company wants to be growing, modern and innovative business full of
opportunities.
 Business objectives: This company main objective is to become a leading retail super
market and provide good quality products at low cost to compete in market.

 Stakeholders: Stakeholders of TESCO includes customers, suppliers’ employees,
business partners and environmental groups those are strength for this company as it
provides all the goods so that they can sell and earn profits. Customers are external
stakeholder while suppliers and employees are internal stakeholders. Customer influence
company as through their needs and demand they change mindset of firm to bring
innovative products in market so that more customers can get attracted towards items
TESCO offering to its consumers. On the other hand, Employees are internal
stakeholders as they influence company by providing employment security and impress
company with their performance through increased productivity in resulting in good
turnovers of the firm. Further, Suppliers are external stakeholders they influence this
company through providing good quality raw materials, services which enhances the
quality of production by the company which helps the firm in managing successful
corporate reputation. Influencing attitude directly or indirectly motivates an organisation
to grow their business and influence most of the customers to be a part of this brand.
Non-Profit Business (OXFAM)
 Mission: Mission is to create listing solution to eradicate poverty.
 Vision: This company mission is world without poverty where all men's and women
should be treated equally.
 Business objective: This company wants to run life changing development projects to
tackle poverty
 Stakeholders: Directors, trustees and donors of various countries are their stakeholders
they influence this company as directors want best of this company as it is charity-based
company works for removing poverty from the world not for any profit earning goals.
They Staff and employees of this company influences charity and motivates the affected
persons to raise their voice for their rights. These members acting as a stakeholder for the
company mainly influences them to come up with the policies which can help society to
become poverty free nation with their independent rights. Donors are external
stakeholders they are very well aware about the company and its functioning they are
getting impacted by our work directly and influences through assessing the results of the
company of past years. Further, Employees of Oxfam also influences the charity greatly

that's why charity is more successful business in current scenario (Uhl, and Gollenia,
2016.).
TASK 2
P3 How two businesses are organised
Functional areas of TESCO
 Finance- This area work towards recording all the business transactions, controlling the
finance and cashflows so that firm can stays reliable and also checks the financial
position in terms of availability of funds to invest in new projects and to earn profits..
Also, takes timely decisions through comparing predicted performance with actual
performances to analyse the back-fall areas and work for improvement in that areas to
maintain financial soundness.
 Human Resource - It focuses on recruitment, selection and training of new employees to
enhance team power to work effectively. This company Hr department also works in
keeping the important company document confidential and work for the promotions and
development of employees to enhance their morale to work with efficiency.
 Production function: This function focuses on delivering products to customers and
ensuring that there is enough stock available for further trade. This department mainly
ensures about shortfalls in raw materials and plan to fulfil this shortage through different
strategies.
Link of TESCO departmental structure with their functional unit
As the departments of this company are dependent on each other for their functioning
which will affect the productivity and profitability of the firm. Human resource department.
Finance department, Production department all are having some dependency on each other as HR
department depends upon finance function for its information gathering related to employees as
HR department have to make salaries of employees. In the same aspect Production department
also focuses on Finance function for arranging funds for purchasing raw material and starting
production for increasing productivity and profits of employees. On the other hand, Finance
department depends on HR function for gathering documents and information related to
employees to carry out their taxation and other finance activities (Dudin and et.al.,2015).
Functional areas of OXFAM

This company is running lifesaving emergency responses, implemented various
lifesaving projects and organise campaigns to eradicate poverty from grass roots. This company
executes this to remove inequality between males and females to treat them as equal and
motivates them to fight for their rights for making poverty free nation to safeguard their lives and
motivates them to fight for their rights. It also helps peoples of the community to claim fair share
of natural resources and also focuses on arranging money for basic services.
Link of Oxfam departmental structure with their functional units
As this organisation starts their life emergency responses likewise various projects to
motivates all effected peoples to be energetic to keep your viewpoint to reserve rights and make
poverty free nation. Oxfam organisational structure consist of two head authorities as Board and
Supervisors those work for removing poverty and influences affected males and females to raise
their voice and gain their rights to become poverty free with good lifestyle and rights. These
authorities make this possible through implementing different projects and companions to
eradicate poverty.
P4 How style of organisation helps them to fulfil their purpose
Organisational structure of Tesco
TESCO follows hierarchical organisational structure which flows from top to bottom this
organisation uses hierarchical structure to manage different interdepartmental stores and different
people. This hierarchical structure also helps customers to get the best care in business which
will help customers to get impressed with services. This organisational structure helps company
to divide their powers, authorities in such a way that it gets distributed among them according to
their level of work and designations which will help company to fulfil its purpose in terms of
profits are customer loyalty.
This vertical path from top authorities to middle authorities also help employees to get
clear about their promotional steps that at what next step they have to achieve. In the same way
there are some drawbacks of these type of structures as there are maximum chances of
miscommunication between different authorities which can affect the relationships of employees
leading to uncomfortable environment for working. This structure helps the firm in attaining its
core objective which is competitive behaviour among employees to upgrade themselves at better
levels which will increase strong and talented workforce which will give resulting output as
better productivity of the company (Hamilton and Webster, 2018).

Oxfam organisational structure
Oxfam follows two tier organisational structure comprising supervisors and board of
directors Supervisors work for the appointing and dismissing the directors of the foundation and
fixes his or her remuneration (Gomes and et.al., 2014). These bodies update regularly each other
regarding the functioning of authorities which is relevant for the overall well-being and success
of the foundation (Our governance, 2019).
One major benefit of this structure style adopted by OXFAM is that there is clear
communication between the two head authorities which eliminates chances of conflicts and
misconceptions results in smooth functioning and framing of clear targets and goals which helps
company to achieve purpose of making poverty free nation. This type of organisational
framework maintains relations and there are fewer chances of wrong decisions by the authorities.
This two tier structure enhances new ideas in minds of the boards and supervisors to bring some
new approach which can help an organisation to achieve their aim of being poverty free nation
and motivates peoples to fight for their rights (Gallemore and Labro, 2015.).
TASK 3
P5 Influence of two contrasting economic environment on business activities of selected
organisational
Economic Environment of TESCO
Economic environment plays an important role in any private sector which determining the
macroeconomic factor for increasing growth rate of private sector. It helps directly and indirectly
economy of the firm, it includes factor which affect the economic environment of the firms are
unemployment rate, level of consumer confidence, rate of currency exchange, taxes, demand and
supply (Crane and Matten, 2016.). Whereas the economic environment of private sector is based
on the maximising the profit and less role of government involvement. One more factor which
influence the economic environment of private sector that is microeconomic. Microeconomic is
determining in taking decision, it is less scope in affecting economy of firm. On the other hand,
economic environment of country for Voluntary sector is different and is a mixture of private
sector and public sector. Voluntary sector organised and regulates the qualified charities and
trustees for public benefits, it insures that the purpose of public benefits is clarified by qualified
charities. Voluntary sector focus on the welfare state fore development of public in emerging to
explore the sector or encouraging the work value (Tchamyou, 2017).

Tesco focus on the economic factor of customer behaviour on buying direct impact of
paying. In 2018, increase minimum wages rate by 4.4% it creates high shift of cost for Tesco of
millions in UK. Tesco have to focus on the cost of borrowing in UK, Tesco increase prise and
cost and drop off profit. It affects the image and reputation of Tesco on global market. Tesco
depend upon the grocery market of UK with a 27.7% share. Power of spending of customer is
increases because customer is confident about the Tesco current financial structure and market.
The percentage of customer is increaseincreaseds because the trust and quality of Tesco is as per
their demand. Customer spend more on eating at home as compare to eating outside, it increases
the sales and profit also. Cost of labour is an important factor of economic it can also affect UK
grocery market.
However, Economic Environment of Non-Profit of OXFAM was influenced with
liberalisation in trade policy increases it helps Oxfam to invest in market and opportunity to
cross the limits and made the expand market capturer in UK. High exchange rate help Oxfam to
identifying the short term and long-term investment plans to reach the level of workforce. For
further globalisation financial market have the availability of equity market. Oxfam can invest in
high level of skills of Volunteers in present global opportunity of market. Intervention of
government and their policies will create problem for Oxfam to capture global market. In 2018
rate of inflation is high and increase the market availability to impact the competitor and create
the identity in global market (Cavusgil ,and.et.al., 2014.). Trade policy of liquidity in global
market create availability of workforce to develop present market and help to maximising the
investment for communities.
TASK 4
P6 Impact of political, legal, social factors on business activities of selected organisation and
stakeholders
TESCO
Political factor: Political factor is extent the government policy and specify industry,
stability of taxation and fiscal policies. It retains trading policies, corruption and internal political
issue. For legislative of employment, retailers are encouraged by government to provide
maximum opportunity of job in flexible ways (Enqvist, Graham and Nikkinen, 2014). Large
number of Tesco employees disabled, old people, students, frequently paid them low rate of
salary (Bah and Fang, 2015.). As this company is operating in 12 countries including Asia and

Europe so due to trade between far places there are political factors as taxes, political instability,
unemployment rate and economic conditions of the place where it operates all are affecting this
company directly or indirectly resulting in ineffective trade and earning less profits. This factor
also impacts stakeholders as they have to enhance their budgets to cope up with the challenges
and retain policy of Tesco. Impact of political factor, it creates problems for business activity
through increases high rate of employees (PESTLE Analysis for Tesco discusses its Business
Environment, 2014). Hiring of employees creates high investment as it leads to increase in
expenses of firm. paying salary, so stakeholders will have to enhance their budget and retain the
policy of Tesco. Government policy impact business as well as stakeholder also for example
Tesco can be affected by import duty of goods because Tesco inventory import outside UK like
East Asia and China. “Tesco Tax” is large supermarket of tax, it is proposed through local
council but government of UK cancelled the initiative to avoid rising of price. Avoidance over
the proposal can affects the interest of stakeholder with an activities of Tesco (Menychtas, and
et.al., 2014.).
Legal factor: Legal factor is main point of Tesco because without legal appliance firm cannot
run the firm effectively. There is some legal action faced by Tesco for accounting fraud and
deceptive with investors at the end Tesco have to settle with 12 million. It affected the
stakeholder and customer also to trust Tesco again investing and buying the product. In
accordance with this firm managed strict code from Food Retaining Commission. Compliance
with legal framework is supportive space which helps the firm in protecting interests of
stakeholders like suppliers, customers, government, etc.
Social factor: Due to variety of social changes in environment as current trends indicates
that customers now a days have moved towards bulk shopping to one stop shopping. Types of
goods and services demanded by consumers are influenced by their attitudes and beliefs. And
also, customers are becoming more aware about health issues now days which is resulting in
changes in approaches of Tesco and forcing them to adopt this preference changing attitude of
customers and come out with some healthy organic products which can influence customers to
get attracted towards that product and increase productivity as a result.
OXFAM
Political factor: Political factor play an important role in Oxfam for setting policies and
procedure of goods because of government involvement Oxfam cannot discriminate the

volunteer. Oxfam have to save money for further requirement in future and needs of volunteer, it
also helps stakeholders for investing and maintain the trust with Oxfam. Oxfam do not
discriminate the volunteer because of their gender, it creates conflict between males and females.
It is not requiring to paid volunteer who are working according to law of National Minimum
Wage. It helps and advantage to Oxfam for saving the money and give to who need help.
Legal factor: After entry of international market Oxfam have to carefully consider normal time
of poverty Oxfam. According to employment law it impacts the managing people and leading the
business model. Oxfam will collect data from their volunteers to make sure that the data will be
confidential and protected.
Social factor: Social factor does affect the voluntary firm because it is based on charity.
Oxfam has no necessary to advertise the firm in bigger level like hosting and create major sports
events. Small advertising and advertise on TV are enough to promote Organisation. In 2010,
Oxfam seen as donating money as charity in kinder way and it reflect goodwill or image of
Oxfam. The only drawback is aging population which influence the Oxfam. The organisation is
already doing great job of providing money to those who need, it creates kinder image of Oxfam
in every mind. For that stakeholder also show interest for investing money in Oxfam for giving
them contribute to helping people.
CONCLUSION
The report summarised business environment of two contrasting organisation one is profit
based firm 'Tesco' and another one is non-profit based company ' Oxfam'. This report has
concluded types of business and their relationship and also concluded how stakeholders
influences purpose of these businesses. Further this report concludes about functional areas of
the business in connection to its organisational structure. On the other hand, this report
summarised that how environmental factors as political, economic, legal, social and
technological factors impacts organisational functioning. This analyse of factors has been
concluded in this report with the help of Pestle analysis. This report also concludes that how
different styles of doing business helps organisation in fulfilling their purpose.

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