Business Environment and Organizational Style

The provided document is a report on the business environment and its impact on Mark & Spencer's (M&S) activities. It categorizes the business environment into two parts: micro environmental factors (internal factors) and macro environmental factors (external factors). The report explains the different kinds of environmental factors, their purposes, and how M&S can choose an appropriate organizational style to increase financial profit and attract customers. The document is relevant to students studying business and management.

The Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
P1. Different types and purposes of organisation and ownership...............................................1
P2. Different stakeholders and their influence on Business........................................................2
P3. Manner in which two business are organised.......................................................................3
P4. Styles of organisation............................................................................................................4
P5. Influence of two contrasting economic environments on M&S...........................................5
P6. Impact of macro factors on business activities and their stakeholders.................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Business environment is consist of various internal and external factors which affects the
performance of every enterprise. In simple words, success and failure of a company is
determined by its internal and external elements. Generally, internal components of company
involves management, employees, organisational structure and so on (Constangy, Marger and
Brompton, 2015). Whereas, macro environment involves political, economical, social and
technological factors. This report is based on Mark & Spencer which is a multinational retailer
company and situated in United Kingdom. In this report, various types of business and their
purposes has been explained. Along with this, influence of macro environmental factors on
organisation has also been described.
P1. Different types and purposes of organisation and ownership
A business entity is an organization that uses economic resources or inputs to provide
goods or services to customers in exchange for money or other goods and services. Business
organizations come in different types and different forms of ownership (Kennerley and Neely,
2003).
3 Types of Business
There are three major types of businesses:
1. Service Business: A service type of business provides intangible products (products with no
physical form). Service type firms offer professional skills, expertise, advice, and other similar
products.
Examples of service businesses are: salons, repair shops, schools, banks, accounting firms, and
law firms.
2. Merchandising Business: This type of business buys products at wholesale price and sells the
same at retail price. They are known as "buy and sell" businesses. They make profit by selling
the products at prices higher than their purchase costs.
A merchandising business sells a product without changing its form. Examples are: grocery
stores, convenience stores, distributors, and other resellers (Kennerley, Neely and Adams, 2003).
3. Manufacturing Business: Unlike a merchandising business, a manufacturing business buys
products with the intention of using them as materials in making a new product. Thus, there is a
transformation of the products purchased.
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A manufacturing business combines raw materials, labor, and factory overhead in its production
process. The manufactured goods will then be sold to customers (Schepers and Van den Berg,
2007).
Forms of Business Organization
These are the basic forms of business ownership:
1. Sole Proprietorship: A sole proprietorship is a business owned by only one person. It is easy
to set-up and is the least costly among all forms of ownership.
The owner faces unlimited liability; meaning, the creditors of the business may go after the
personal assets of the owner if the business cannot pay them.
The sole proprietorship form is usually adopted by small business entities.
2. Partnership: A partnership is a business owned by two or more persons who contribute
resources into the entity. The partners divide the profits of the business among themselves
(Witkowska, 2007).
In general partnerships, all partners have unlimited liability. In limited partnerships,
creditors cannot go after the personal assets of the limited partners.
3. Corporation
A corporation is a business organization that has a separate legal personality from its owners.
Ownership in a stock corporation is represented by shares of stock.
The owners (stockholders) enjoy limited liability but have limited involvement in the company's
operations. The board of directors, an elected group from the stockholders, controls the activities
of the corporation.
P2. Different stakeholders and their influence on Business
Accomplices are anyone that is affected by a business or has an energy for it.
Accomplices are affected by particular decisions made by associations, paying little heed to
whether it is positively or oppositely. They can affect an association and the decisions that they
make. Customers require extraordinary quality things and organizations at direct costs (Pingali
and Roger, 2012). They get a kick out of the opportunity to see improvements consistently being
made with the objective that they believe they are getting a motivating force for money. As often
as possible, people associate themselves with particular brands they buy. Affiliations and
associations are destitute upon their customers. If they do not make customer reliability, they
could begin to lose their customers. Customers get a kick out of the opportunity to identify with
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the brands they buy. M&S?s customers have a tremendous effect over the business. They use
their customer?s information to reveal any legitimate and expected upgrades to their business.
Customers can give their considerations, points of view and comments with a particular true
objective to reveal to M&S how they are doing as an association and what updates they feel
ought to be made etc. They don't offer the right organizations, things and progressions, at that
point their customers will end up shopping in choice stores (Yagyasen, Darbari and Ahmed,
2013).
The essential concentration of Primark's is that customer who are especially discerning
about shape and besides the people who needs regard for their money. Accomplices are the
people who has quick or underhanded their stake in the affiliation (Kennerley, Neely and
Adams,2003). In the relationship there are such an assortment of different accomplices like
advance supervisors, customers, boss, specialists, government, suppliers, union and gathering. In
the affiliation considerations of each accomplice are unmistakable.
Partners of Primark:
 Suppliers: (untouchable and Factory conveying items)
 Customers: (need to understand that the thing they purchased are made ethically)
 Governments: (countries in which mechanical offices and stores are found)
 Trade Unions: (these are the bodies who addressing the workers)
 Non-administrative Organizations: (give help and responds in due order regarding
worker's issues)
 Investors: (Investors of association or affiliations)
 Delegate: ( creator of pieces of clothing)
 Gatherings: (Providing support and help) In the affiliation each accomplice is basic.
P3. Manner in which two business are organised
M&S Board of Directors contains 10 people and there were basic changes in the Board in
the midst of the cash related year 2014/15 (Schepers and Van lair Berg 2007). M&S definitive
structure is particularly dynamic reflecting the immense size of the business. In reality, even in
store level, there are upwards of four layers of organization in some broad stores. Note that the
structure underneath is not resolute for all M&S stores and a couple of stores work with a
possibly special structure reflecting their territory, appraise and an extent of other store-specific
factors.
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It can be fought that three or four organization layers inside a singular store may make
pointless association with a negative consequences on the surge of information over the
organization layers. In this way, the senior level organization needs to consider delayering
openings i.e. growing the versatility of operations and changes inside store and stimulating the
surge of information by methods for decreasing the layers of organization (Klapper and Parker,
2011).
Primark Stores Limited Introduction Primark Stores Limited is a reinforcement of
Associated British Foods PLC, and Primark has transformed into a settled family name starting
late. It has set a benchmark for a few associations to follow in a section of the market named the
'regard division'. The association was set up to make clothing that is a motivation for money, so
to speak you are paying for the idea of the thing and not for the check that come joined
(Schmidheiny ,1992).
P4. Styles of organisation
M&S structure empower each motivation to focus in their particular theme and focus on
what they are awesome at instead of the district that they don't know anything about. Primark
reliably endeavour and give the best customer organization and pitch the best things to the
customers from that point forward it shows what sort if association they are and that they will
effectively empower customers if they to require it (Yagyasen, Darbari and Ahmed, 2013). In
case each of the labourers expected to administer to more than one locale at any given minute it
would be ghastly for the association from that point forward they would not have space plan
savvy to guarantee that each of the reaches are spotless which infers that the vocations will finish
truly or missed all together which is terrible in light of the way that it contemplates gravely the
business. Primark furthermore have a publicizing bunch which is moreover something to be
grateful for the business since it suggests that they end up plainly familiar with what the
customer considers, which infers that they can costs back to the buyers and distinctive divisions
so they can change the way that the show and the things are. The structure makes them work
more capably and quickly which is something worth being grateful for in light of the way that
then it infers that they can stay before their restriction and makes the arrangement build up every
day (Harrison, 2011).
The purposes of affiliations depend on upon the sort of business they are. For example,
the purposes of a charity affiliation will be extremely not the same as those of a for-advantage
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overall business. A business needs an unmistakable capacity to know east from west, which must
be clearly passed on to all accomplices. This is the purpose of the business which would then be
able to be isolated into smaller focuses and objectives. There are past suppliers that M&S have
had a positive relationship with and some of which the suppliers have been kept right now.
P5. Influence of two contrasting economic environments on M&S
Money related improvement will impact M&S as it would assemble their advantages in
view of more people requiring more things and expecting to spend their money (Harrison, 2011).
In this errand I would be talking about the effect of two money related circumstances on business
works out. So this could be the way by which Primark in the UK worked in the midst of the
withdraw and the impact time period. The UK is in the improvement money related condition
and this infers the country was before in the subsidence monetary condition.
Financial: Significance of constancy security is when specialists can make desires for the
short and the medium term about likely demands for their things soon.
Primark would be impacted if there are changes in the money related condition and these
are advancement, subsidence and continuously outstretching impact. Improvement is when more
things are being conveyed and consumed. This furthermore suggests the vocations are rising. So
in Primark if customers buy more stock and ventures, the era office would make a greater
number of things than the standard with the objective that they can offer more things.
P6. Impact of macro factors on business activities and their stakeholders
Primark: Political variable: Political can Primark in both oppositely and decidedly
through changes made to obligation, work and national security laws (Carroll and Shabana,
2010).
Legitimate variable: Business can be affected by various aspects of government approach. They
ought to in like manner consider the impact of any unavoidable institution on their operations.
This may require taking exercises before the enactment ends up plainly viable.
Social element: Society is industriously changing for instance, taste and plan consistent change.
Present, youthful purchasers have been raised amid a period where mobile phones and PC are
used every day. Associations will conform to this standard and start to consider the necessities of
the new time.
M&S:
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Politician consider: With a relationship as extensive as M&S there will be various subjects that
may impact them. For instance political. This could fuse government support, give, overhauling
aptitudes of the working people of M&S which may fuse get ready days or selection days in case
you have as of late been now used (Cantwell, Dunning and Lundan, 2010).
Legitimate component: The major Legal variable would be that no individual can work more
than 39 hours on a typical working week. This is the law (Boons and Lüdeke-Freund, 2013). The
way this could affect M&S activities is that M&S may require a rota to share the working hours
in the midst of the day and in the midst of the night shifts.
Social calculate: The rule social Factor would be the present dejection that is happening inside
the world in spots like Africa and different poverty struck spots.
CONCLUSION
Through concluding this project report, it is concluded that business environment plays
and important role in different organisations. It is categorised in two parts which are micro
environmental and macro environmental factors. All companies consider these factors while
making their important business decisions. In this report, different kinds and their purposes has
been explained so that Mark & Spencer can choose appropriate organisational style. Through
analysing all environmental factors this company can make effective and systematic strategies
which helps it in increasing high financial profit and also will help in attracting a huge number of
customers.
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REFERENCES
Books and Journals
Constangy, H.W., Marger, E and Brompton, A., 2015. CHANGING BUSINESS
ENVIRONMENT.
Kennerley, M and Neely, A., 2003. Measuring performance in a changing business environment.
International Journal of Operations & Production Management. 23(2). pp.213-229.
Kennerley, M., Neely, A. and Adams, C., 2003. Survival of the fittest: measuring performance in
a changing business environment. Measuring Business Excellence. 7(4). pp.37-43.
Schepers, P and Van den Berg, P.T., 2007. Social factors of work-environment
creativity.Journal of business and psychology. 21(3). pp.407-428.
Schmidheiny, S., 1992. Changing course: A global business perspective on development and the
environment (Vol. 1). MIT press.
Taipale-Erävala, K., Heilmann, P. and Lampela, H., 2014. Survival competence in Russian
SMEs in a changing business environment. Journal of East-West Business. 20(1).
pp.25-43.
Witkowska, J., 2007. Foreign direct investment in the changing business environment of the
European Union’s new member states. Global Economy Journal. 7(4). pp.1-30.
Yagyasen, D., Darbari, M. and Ahmed, H., 2013. Transforming non-living to living: a case on
changing business environment. IERI Procedia. 5. pp.87-94.
Online
Neil Kokemulle, 2017. What Are Internal & External Environmental Factors That Affect
Business? [Online]. Available Through: <http://smallbusiness.chron.com/internal-
external-environmental-factors-affect-business-69474.html>. [Accessed on 19th July
2017].
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