Business and Business Environment: Types of Organizations and Their Legal Structures

This report discusses different types of organizations such as public, private, and voluntary sectors with their specific legal structures. It also explains the size and scope of different types of organizations and the inter-relationship between different organizational functions in connection to the company's objectives and structure. Additionally, it covers the positive and negative impacts of the macro environment on various business operations, supported by specific examples.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purpose if organisation with their legal structures............................1
P2 Size and scope of different types of organisation.............................................................3
TASK 2............................................................................................................................................6
P3 Inter-relationship between organisation function in link with their objectives and structure
................................................................................................................................................6
TASK 3 and TASK 4.......................................................................................................................8
P4 Positive and negative impacts of the macro environment on various business operations,
supported by specific examples..............................................................................................8
P5 SWOT Analysis of Marks and Spencer..........................................................................10
P6 Inter-relationship between external macro factors and strengths & weakness...............11
CONCLUSION..............................................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Business is refers to an enterprising entity or organisation engaged in commercial,
professional activities or industrial. It can be either for profit or non-profit organisation. There
are different types of range such as, limited liability companies, corporations, partnerships and
sole proprietorship. (Maksimov and et. al., 2020) Business environment refers to collection of
individual, entities and other factors that may or may not be in control of company, it can affect
their performance, growth, survival and profitability. In this report there will a discussion about
different types and purpose of organisation such as, private, public and voluntary sector with
their specific legal structures. With these there will be a explanation about different size and
scope of different types of organisation. A relationship between different organisational
functions and they are interlink to enterprise structure and objectives. Lastly There will a
presentation on external and internal analysis to identify strengths and weaknesses with their
interrelation.
MAIN BODY
TASK 1
P1 Different types and purpose if organisation with their legal structures.
There are various types of entities that includes private, public, charitable, co operative
and voluntary sectors some of them are mentioned below.
Public sector-
Public sector is basically a portion of the economy that composed all levels of
government & government- controlled enterprise, it is a part of economy that provides a public
transformation, health care, police, public education and military service with other things.
Public organisation are mostly non-profit company which are generally undertaken or controlled
by either state government or through central government. (Preghenella and Battistella, 2021)
 Purpose- The main purpose of public sector organisation or government entities is to
provide good & services rather than generating profits.
 Legal structure-
◦ Central government- Organisation that comes under this category are generally
funded or controlled by central government with the help of tax collected or treasury
such as, British electricity authority.
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◦ Local government- Firms in this category are mostly controlled by municipal
authorities and generated through the revenue of local communities such as,
Corporation for public forecasting.
◦ State government- Entities in this type are generally controlled by a specific
department of government, there is also a interference from central government but at
limited level. Such as, British business bank.
Private sector-
Private sector organisation is a part of every countries economic system which is
managed and controlled by individual person or business. These types of companies are mostly
run with an intention of making profit. The operation of private sector is managed individually
without any interaction of government. It is an encouraging part of country growth and economic
development and are chief agent in order to create employment, building competitiveness,
driving innovation and providing fund. (Bilchitz, 2021)The main aim of such type of firms is to
generate more and more of profit in order to stand in market for much longer period of time.
 Purpose- The private sector organisation main purpose is to earn profits from their
company business operations.
 Legal structure-
◦ Sole proprietorship- Organisation in this category are owned and managed by a
single individual which is the owner of that business and is responsible for all debts,
loss, profits related to firm such as, IKEA.
◦ Partnership organisation- In this category firms there is an agreement between tow
or more either persons or organisations with an intention to share profits and loss of
business either by decided ratio or equal part. Such as, Go Pro and Red bull.
Voluntary sector-
The voluntary sector organisation refers to a business whose main purpose is to
create social impact rather than focusing on profit, it is also called a third sector, not-for-profit
sector or civil society.(Buchheim, Krieger and Arndt, 2020) It a part of economy that is based on
non-profit-making business in order to provide services in community.
 Purpose- The primarily purpose of these firms is to develop opportunity and to provide
social services with main focus on social development of community.
 Legal structure-
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◦ Unincorporated association- Firms in this category can be defined as an association
of two or more individual who are bound together for a common purpose and each
individual are personally responsible for their duties and obligations. Such as, Glaxo
Smith Kline plc.
◦ Trust- In this category organisation are generally an associations which are not bind
by any law and the members are known as trustees. They are responsible for every
action related to operation of business. Such as, Barts Health NHS Trust.
P2 Size and scope of different types of organisation.
PUBLIC SECTOR- BBC
Company overview- British Broadcasting Corporation is a national broadcasting firm in
UK, founded by HM government in 1922 with headquartered in broadcasting house, London,
United Kingdom.
Vision-
Vision of BBC is to focus on becoming most creative company in world.
Organisation are achieving their target more with the help of creating an attractive planning in
order to provide services to their customers. In order to fulfil vision firm is considering different
forms to create and provide information to public.(Ziora, 2020)
Mission -
The main mission of business is to consider public interest through providing
impartial provision, distinctive output and high quality services to serve audience a information
regarding their entertainment and education. In order to maintain their mission company is
focusing on public interest.
Size-
Market presence of firm is huge as it is one of the top leading broadcasting brand
in UK and world's oldest national broadcaster. It is on top of providing public service in globally
as well.
Scope-
As company presence in international market is huge, still there are countries firm
can expand their operation, in order to increase enterprise growth and international presence.
Business can expand their broadcast on online platform for customers, so that they can enjoy
from internet.
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Stakeholders-
Companies stakeholder are both internal and external that includes owner,
shareholder, managers and employees. In external stakeholder it includes customers,
government, banks, local community and supplier.
PRIVATE SECTOR- Marks and Spencer
Company overview- Marks and Spencer is major British multinational retailer, founded
by Michael Marks and Thomas in 1884 with headquartered in London, England, UK.
Vision-
Vision of the company is to establish a strong standard against their competitors
that can be measured from customer's experience. With a motive to care for environment and
community to create a good working environment or employees.
Mission -
Brand mission is to build a core values towards value, service, trust, quality and
innovation, as an overall business mission is to make a aspirational quality to accessible for
everyone with the help of depth and range of their products.
Size-
Companies market presence is huge in globally as it has over 1037 stores located
in UK and also around 470 other stores in around the world, with employees around 70 thousand
across worldwide.
Scope-
As firm presence in globe market is strong but there are countries where company
can expand their operation. (Sarja, Onkila and Mäkelä, 2021) Enterprise can focus on creating
strong base on digital marketing, as it will provide increase in growth and profit of company.
Stakeholders-
Marks and Spencer stakeholder consists of both external and internal that
includes, customers, shareholder, investors, local communities, pressure group, employees and
government.
VOLUNTARY SECTOR- Oxfam
Company overview-
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Oxfam is British charitable organisation that focus on alleviation on reducing
global poverty, it was founded in 1942 in Oxford, England with headquarter in Nairobi, Kenya
led by Oxfam international.
Vision-
Vision of the organisation is to make world without any poverty. The world where
people are treated and valued equally and enjoy their every rights, as they can influence
decisions affecting their lives.
Mission -
Enterprise mission is to help through creating a lasting solution to injustice of
poverty. Empowering people to make a their future secure and free them from poverty. To end
poverty from locally and globally.
Size-
Oxfam has an international presence with around 300 staff globally, their
affiliates have over 10,000 staff as volunteers and interns presence around world. Company
operation in 90 countries.(Türkmen and Soyer, 2020)
Scope-
Company presence in international market is huge but here is a scope for them is
that, there are countries where such organisation presence is important in order to serve their
people from poverty and help them.
Stakeholders-
Firm mainly have external stakeholder that includes, donors, alliances,
governments, public, private sectors, academic institutions, suppliers, supporters and
environment.
TASK 2
P3 Inter-relationship between organisation function in link with their objectives and structure
ORGANISATIONAL STRUCTURE
An organisational- structure is a system that defines how certain are activities are oriented
to achieve the common goal of organisation. It also determines that how communication will
flow between different levels, It confirms the hierarchy within the organisation. For instance, in
centralised structure, decision-making power is in the hands of top level but at the same time in
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decentralized structure, the power of decision making is divided into different levels of the
organisation. (Goody, 2018) There are four type of organisational structure-
1. Functional structure:- This structure divides company into departments respective of
their specialisation of its workforce and these departments are consists of marketing,
sales, finance, operations. Most of the small to middle sized businesses use this structure.
2. Divisional structure:- This structure is mainly followed in large organisation having
many business units. So companies using this structure haves many products, projects
and subsidiaries and for them they have different leadership respectively.
3. Flatarchy structure :- This structure is mainly followed by start-up as it flattens the
hierarchy and provides every employee autonomy. In this mentioned structure
implementation gets faster as every employee has power to implement.
4. Matrix structure:- This structure is least used because it is very complex and confusing.
For instance employees working in more than one department like sales and finance. The
company divide employee through matrix in different groups accordingly.
In context to mark and Spencer company, it is recommended to management of firm that
they should follow divisional structure, as organisation is dealing in many products and this
structure is beneficial or suitable for the firm like this, many larger organisation follow this
because this structure provides differentiate leaders for every product or project accordingly to
their specialisation. (Anshari and Sumardi, 2020) It creates segments of business based on
product and project, as opposed to their job roles. Companies having certain characteristics will
more on using this type of structure.
 Offering a wide range of products to customers.
 Advertising to a wide variety of demographics.
 Providing products requires personal attention for customer.
 Marketing their products to different geographical areas.
There is a reason behind suggesting this structure to company marks and spencers, some
of them are mentioned below :-
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 This structure provides transparency and accountability because divisions have their own
management team to lead them.
 This structure helps to gain the local competitive advantage as managers have autonomy
to take decisions in their scope.
 This structure offers more market share as it is capable of accommodated expansion.
The inter-relationship between different organisational functions in connection to
company's objectives and structure are as such. (Otley and Berry, 2019) Relation between
marketing and finance, business goal of both is same that is making company profitable and
maintain cash flow. Most marketers are all about long term planning, numbers, revenues,
demand generation and marketing campaign. Most finance executive are also number based.
Some relationship between both are written down below:
 Marketers are going to ask big budget for marketing and finance are going to limit the
budget but none of the side sit down and address the counter part of why they need more
budget and why they need to cut down budget.
 When marketing spends more money without knowing its return on marketing investment
and finance take charge from there and refuses the spend.
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TASK 3 and TASK 4
P4 Positive and negative impacts of the macro environment on various business operations,
supported by specific examples.
Speaker notes: A PESTLE analysis can be used in different cases and guide organisation or
manager to take strategic decisions and this analysis studies that help an organisation to
understand its key external factors that can influence an industry. The PESTLE analysis is
performed on marks and Spencer, which is a UK based company dealing in retail outlets with
food and clothing lines.
Political factors
These factors are related to country's government , how the government treats the company and
what are the policies they make for business.
Positive impacts- The company has took the benefit of Europe Union's trade agreement
and this helps the company in reducing the sourcing cost. Mark and spencers utilized the EU
agreement by selling products without tariffs across the different countries.
Negative impact- If government increases the tariffs on products which will end up
having increased price of product and hence less demand for products.
Economical factors
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These factors are related to the economics environment that directly impacts the business
performance of the company like changing fiscal policy , change in inflation rate etc.
Positive impact- UK is one of the biggest economy that has controlled its inflation rate
and marks and Spencer made strategies to take its fullest use in environment of low inflation rate.
Negative impact- Financial crisis, lead company to decrease in demand for products due
to low disposable income in the hands of the customers.
Social factor
Social factor is related to society of a country that how they respond to product , some people
gives emphasis on quality and some on quantity, different people have different thinking.
Positive impact- This factor is been countered by company and dominating the ready
meals industry. The demand for this brand's product has been raised in UK market and all over
the world as well.
Negative impact- Mark and Spencer isn't a modern name so its customers relate it with
past. Due to long existing, customer's aren't able to associate this brand with brand of the youth
and hence it is losing the customers of new age.
Technological factors
Technological factor is related to the using of technology and the process of accessing
technologies and tools that can be used to develop the digital environment.
Positive impact- Marks and Spencer has opened their thoughts on technological
transformation programme it will help company toward becoming digital first business. They
have took a big step towards agile, faster and commercial technology will help them to grow
business.
Negative impact- The company has low online presence as it does not avail its facility of
online stores world wide.
Legal factor
Laws and legislation made by government impacting businesses comes under this factor like
taxation policies and new business law etc.
Positive impact- The company has regularly improving and making rules accordingly
laws of particular geographical area.
Negative impact- Marks and Spencer convicted two charges related to health and safety
at work act 1974 and they have to pay 500000 pounds for each offence.
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Environmental factor
This factor analyse the environmental concern and what are the things that are caused by product
in our surrounding .
Positive impact- The marks and Spencer has promoted the factor of sustainable retail
industry multiple times they have took oaths and vows to be careful about their production
process.
Negative impact- Marks and Spencer have been criticised by many groups across the
world because of the pollution caused by textile producers that call themselves suppliers.
P5 SWOT Analysis of Marks and Spencer
Speaker note: SWOT analysis is a framework that helps in identifying and analysing companies
strength, weakness, opportunity and threats that may affect business growth and success in
market.
Strength- Marks & Spencer is well-experienced and has been in the market since past 136 years.
It is one of the top leading retail brand in UK, experience of plethora is huge plus point for the
firm. It is well reputed entity in order to provide quality products to their customers in market, it
is second most popular supermarket. Company has a quite value for money because it provides
quality, convenience and wide range of products.
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Weakness- There is strong competition in market from other retail brands which lead to limited
market share of company. One of the major drawback of firm is that it has a heavily relies on
manual operation system in management which cost them immense and consume lot of time.
Enterprise is behind adopting latest technology in various process, as other firms already adopted
latest tech which help them in saving time, cost and it is efficient.
Opportunities- Marks and Spencer is a multinational brand but there are other countries which
firm needs to expand their business. In this way brand will play an active role through increasing
more and more branches in other countries. Firm can build its online presence more strong as
current market is focusing more on digital shopping as it will help companies online growth and
a great opportunities that it should pursue.
Threat-Marks and Spencer has some great competitors in market of UK and also in abroad. As it
faces big threat of losing scope in business, competitors such as, Amazon, Tesco, ASDA and
others. If firm will not change their strategy then it would fade away from market gradually
because of the strong competitors.
P6 Inter-relationship between external macro factors and strengths & weakness
Speaker notes:
Political- As the stability of government policies within UK is high from which company make
adjust their strategies regarding policies for long term process which will led to better result
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and smooth functioning of business. There are some benefits from EU's trade union
agreement is working for the company.
Economic- UK has one of the highest economy that has a control over business inflation rate
which is working for the business. But due to this it also reduce companies demand in
market due to low disposable income of the company.
Social- business is keeping updating there trends with current market trends which help in
making a strong establishment in market and attract new customers every time with new
launches of products for customers. Brand a strong image and value in market which help in
favour of business.
Technology- As technology is changing constantly from which there is increase in production
costs which led to increased in price of products and reduce in demands, but company has
developed technology in operation and production from which it is helping company in
other factors also.
CONCLUSION
From the above report it is concluded that there is different organisation sector with their
individual structure that help in maintaining the work flow in systematic for better performance
within company. Through the analysis of private, public and voluntary sector from their purpose,
size and scope helps understanding different sector and also relation between each department in
order to do perform operation of any firm. Lastly from the analysis of external and internal
factors of business environment through the help of pestle and swot helps understanding factor
that may or may not affect the company success and growth in future basis, with inter-
relationship of strength and weaknesses.
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REFERENCES
Books and Journals
Anshari, M. and Sumardi, W.H., 2020. Employing big data in business organisation and business
ethics. International Journal of Business Governance and Ethics, 14(2), pp.181-205.
Bilchitz, D., 2021. Fundamental Rights and the Legal Obligations of Business. Cambridge
University Press.
Buchheim, L., Krieger, A. and Arndt, S., 2020. Innovation types in public sector organizations: a
systematic review of the literature. Management Review Quarterly, 70(4), pp.509-533.
Goody, J., 2018. The social organisation of the Lo Wiili. Routledge.
Maksimov, M.I. and et. al., 2020. Acceleration of business: a comparative analysis of companies
development methods. Journal of Advanced Research in Dynamical and Control
Systems, 12(6), pp.2248-2253.
Otley, D.T. and Berry, A.J., 2019. Control, organisation and accounting. In Management Control
Theory (pp. 101-114). Routledge.
Preghenella, N. and Battistella, C., 2021. Exploring business models for sustainability: A
bibliographic investigation of the literature and future research directions. Business
Strategy and the Environment, 30(5), pp.2505-2522.
Sarja, M., Onkila, T. and Mäkelä, M., 2021. A systematic literature review of the transition to
the circular economy in business organizations: Obstacles, catalysts and
ambivalences. Journal of Cleaner Production, 286, p.125492.
Türkmen, E. and Soyer, A., 2020. The Effects of Digital Transformation on Organizations.
In Handbook of Research on Strategic Fit and Design in Business Ecosystems (pp. 259-
288). IGI Global.
Ziora, L., 2020. Machine learning solutions in the management of a contemporary business
organisation. Journal of Decision Systems, 29(sup1), pp.344-351.
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