Business and Business Environment

This document provides an overview of the business and business environment. It discusses the purpose of private, public, and voluntary sectors and their legal structures. It also analyzes the size and scope of different types of organizations and explores the relationship between different organization functions. Furthermore, it examines the positive and negative impacts of the macro environment on business operations. Lastly, it conducts a SWOT analysis to identify the strengths and weaknesses of specific organizations.

BUSINESS AND BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
P1- Purpose of private, public and voluntary sectors and their legal structures..........................3
P2 Size and scope of different types of organization...................................................................4
P3-Relationship between different organisation function ...........................................................6
M2- Advantages and disadvantage of interrleationship with various business functions..........7
P4 Positive and negative impacts the macro environment have on business operations.............8
P5- Analysis of external and internal factors of specific organizations to identify its strengths
and weaknesses............................................................................................................................9
P6 Interrelationships of strengths and weaknesses of organizations with its External macro
factors.........................................................................................................................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment is major aspect of every business. It is all about the external and
internal factors that affect functions of company including management, business norms and
regulations, customer needs and employees. These all factors influence business environments
and are very important to keep its durability for a long term. There are some forms of business
which are depended on the criteria like size of operations and nature ans scales of business
according to their basis of industry. It involves the relationship of them with organizations
objectives and strength. It involves the impacts a business that influence appropriately in
decision-making.
P1- Purpose of private, public and voluntary sectors and their legal structures
Private sector- it is a division of economy and its legal structure is it is run by one or more
individuals for earning profits. Organizations that are not owned or operated by government are
defined as private sector (Galli, 2018). Their main objective is to maximize profits and plays an
essential role to minimize deficit of budgets. Private sectors earned a lot of surpluses to enhance
growth in economy. Purpose of private sector is to promote enterprises by providing facilities for
business commercial activities and assure attractive investment in the country. It also makes
collaborations with private-public relationships to come up and hold large scale in economy.
Public sector- It is also a part of country's economy and its legal structure is that it is owned and
operated by government and survives to provide services to its citizens. Public sector are
integrated under the companies Act 2013. Its objectives are to prevent concentration of power in
economy and developments of private monopolies. This sector purpose is to support government
for imposing social control on industry and trade for assuring equal distribution of services and
goods. Their main aim is to provide public services instead of making profits (Coetzee and
Erasmus, 2017). It deals with negative externalities and promote competition. It is responsible
for providing emergency service by not thinking of profitability. This sector does not need to
meet success criteria of commerce. Public sectors are organized in regional, national and national

level. This sector is durable because it provides benefits to community and operated with amount
that are raised from government taxes.
Voluntary sector- This sector has social duties that are non profitable and non governmental. It
has three legal structures that can be a small group, a trust and incorporated association
(Weisinger, Borges-Méndez and Milofsky, 2016). It does not intend to employ workers or own
property. Its primary purpose is to build social impact rather than providing services or gaining
profits. It is also called non-profit sector or civil sector. This sector supports public sector to save
money and engage with communities to fulfil needy people requirements. It provides affordable
housing needs. This sector support and fights for individuals that are facing domestic abuse or
violence. There are no reliable methods of evaluating size of voluntary sector. There are cultural
differences which separates this sector from other two because its mission is to balance their rare
flexibility and play a important role by
volunteering in different ways to create a great social impact.
P2 Size and scope of different types of organization
The following table shows about the micro organization, small organization and large
organization in developed countries-
Characteristics Micro organization Small organization Large organization
Meaning These are micro level
of organization. in
these organization
venture capital is low
with less number of
employee.
Such organization are
obsessed by self-
directed figures
(Pollack, Skillman and
Frogner, 2020). Their
investment towards
organization is low as
their hiring for
employee is
accordance to make
enlarge their business
in achieving short term
goals or objective and
They have sufficient
number of funds with
their workforce. These
organization have their
own outlets and more
developed which is
located at local or
international area. It is
large organization so it
comprise with
thousands or more
employees.

most on working of
expansion in their
sales.
Organization Malton card is micro
organization which
deals in selling
greeting cards and
gifts. This
organization work
with coordination as
they also provide self
customization to
customer and also
developed company in
making theme cards
and also satisfies their
growth and have
higher level of
feedback with their
customer for theme
cards.
Davison company
which sales their own
bakery items and also
provide catering at
wedding, party or
some other various
occasion.
Pharmacy2u s online
medicos organization
in United kingdom.
They have developed
themselves with large
number of customer
on daily bases as they
deliver prescribed
medicines at home.
Scope In every developed
countries like United
kingdom, micro
organization like
Malton cards company
is developing. They
have organized their
platforms in adding
value of countries
Small organization
like Davison canner.
These company are
have their manufacture
system and tend to
function themselves in
corporation or group
and their investment
with capital for
These organization is
international company
which process
according to
government guidelines
and corporations. It is
growing company and
earn large amount of
profit as every year

incomes and also helps
them in providing
better opportunities for
expansion in sales and
can earn more
revenues on
operational cost.
business and their
infrastructure.
from each customer on
regular basis (Teer and
Drawe,2019). The
amount which they
earn in form of profits
that can be preserved
in fulfilling long term
goals or objective. As,
generally they also
focus on developing
their operational
department for internal
expansion and
development.
P3-Relationship between different organisation function
There are various function and department in which the company is interlinked which
helps in maintaing co-ordination, linking various business activities of various departments
which in turn helps company to know requirements of different departments and helps in
increasing efficiency at the workplace and which helps to serve various business dynamics which
as a result helps in fulfiling and meeting requirements of its potential customer to business
operation.
Interrelationships between Human resource and Marketing department
In Morrsion there is interconnection betweeen marketing and human resource department
as they work closely to achieve common desired goals of business as Marketing department in
company is increased with making its products and services reach to mass end customers which
can be by the help of talented, skilled and qualified individual whereby makreting department
works with its human resource departement and ask to hire and recruit employees who can serve
with the same by possessing required skills as needed by the company to achieve common
business goals. This are interelated with each other as human resource in the company helps in

attracting right talented individuals for marketing and sale iof the company who are being kept
happy as it helps in deriving a culture which is fun loving and helps in determining there
satisfaction level which account to there better performance at the workplace and which helps in
fulfling goals of both the department where company can market its products and services more
prominently (Prexl, 2020).
Interelationship bewteen Marketing and Finance department
This are interelated with each other as finance department is responsibe for maintaing
good economic position of the company whereas marketing departement is responsible for
making its product and services promotes in target marketplace where they both work closely as
finance department lays down budget to marketing departement in company to promote its
products and services which also ensures company sufficient with its budget to meet future
contingencies and to survive in highly competitive marketplace. This interrelationship helps in
increasing sales of company by accounting with its budget to meet with business dynamics
which can come in ways of promoting products and services of the company (Beneke, 2016).
This relationship also helps in determining return on investment of various sales promotional
activities by which company gets to know things which helps analysing of various business
opoortunities in which company can invest more to foster growth of the company and also get to
know activities which are not usefull and include huge investment which can be ignored and
rather focused on activities which creates more money
M2- Advantages and disadvantage of interrleationship with various business functions
Intererelationship between Human resource and Finance
There is interelationship between both the departments as finance department in the
company helps in laying down budget which helps in determination for human resource at a cost
whee it will recruit and hire employees for necessary job role which is in accordance with the
budget of the company and affordable for the same and which in turn accounts for smooth flow
of business operation. This are also interelated as finance department helps in laying down buget
for various HRM practices such as buget for training and development of new and existing
employees, it norms and standards with various reward management and allocation of budgets

for various activities where employees work overtime which helps in serving relationship
between two department(Sahibzada,2020)
Company if fails to account to its interrelationship between various departments than it
may account to face conflicts at the workplace which will decrease the productivity to achieve
organisationla goals that would affect its profitability and boosting up of revenues.
P4 Positive and negative impacts the macro environment have on business operations
PESTLE model is used to identify the negative and positive impacts macro environment have on
organization. Pestle of Morrison is done.
PESTLE
Political factors: Brexit is the important political event. Changes in the regulations and policies
brings a lot of uncertainty and put negative impact on the company. Multiple government
legislation in UK brought the high impact on the company. Supermarket of Morrison is present
in lot of countries which bring different types of political risks for the company. There is a
positive impact on retail sector because it brought political stability. Employee benefits are
problematic for the company because every country has its own rules and regulations regarding
this which is complex for the company.
Economic factors: Rise in the oil prices which tight the consumer household budget which is
the negative impact for the company. Inflationary pressure is created because of the currency
fluctuations (Christodoulou, A. and Cullinane, K., 2019). Consumer spending or their purchasing
power affect the company if their purchasing power is high than is the positive impact and if
purchasing power is low than will cause the negative impact.
Social factor: Rise in the age of the consumer brings a lot of business opportunities for the
company which gives positive impact to it. People are becoming health conscious in UK, so they
are buying healthy products and company focusing on making healthy products to attract more
customers. Education level also influence the buying behaviour of the customer.

Technological factor: Morrisons has invested in the technological sector which help the
company in reducing the efforts of their employees and making the business more efficient for
the customers. Using of digital data by the company help them to identify the trends and
providing better services to the customers. Company is focusing on research and development a
lot which added advantages for the company (Perera, R., 2017). They bring the technology
impact on the product which they are offering. The technology diffusion rate is the negative
impact for the company.
Legal factor: Company has made certain legal policies supporting compliance. Trade audits are
also carried by the company which ensure the integrity. Company follow proper health and
safety law which is the positive impact. They understand that health is very important so it is
considered on the priority. Company focus on customer protection because they know that if
interest of the consumer is protected that will create brand value for the company and help the
company to generate revenue.
Environment factor: Morrison consider environment factor as the very important factor.
Carbon emissions are reduced by the company and aim in reducing more in future and this is the
positive impact by the company. Company focusing on reducing waste and investing renewable
sources because company want to offer the plastic free environment to the society. Protection of
the environment is the social responsibility of the company. Proper waste management is carried
by the company in the customer service sector.
P5- Analysis of external and internal factors of specific organizations to identify its strengths and
weaknesses
SWOT analysis
Conducting SWOT analysis is an effective way of calculating project of an organization
(Sarsby, 2016). This analysis is an appropriate technique utilized to determine organizations
strengths, weaknesses, opportunities and threats (Phadermrod, Crowder and Wills, 2019). SWOT

analysis is used in the organizational level to recognize how close a business is aligned with its
development trajectories.
Strengths of Morrison:
Morrison’s is one of the fourth largest supermarket companies with 10.3% of share in
grocery industry of United Kingdom. It has more than 500 stores across UK and it has large
employee strength. This company is also listed on stock exchange of London & FTSE Index.
Morrison establishes itself with conspicuous acquisitions in its past. Online shopping & retailing
has maximized its business (Haleem and Jehangir, 2017). It has high efficiency in its distribution
network and supply chain. Morrison offers a huge portfolio of product to its consumers such as
food and beverages, clothing and services related to music. It is well-known for its good quality
products offerings at low prices. Being a food specialist and having its own fresh made food
products give Morrison competitive advantage over some of its rivals.
Strengths of Tesco:
Tesco is one of the biggest organizations holding a primary position in listing on the
London Stock Exchange. It has huge employee strength of over 500,000 worldwide. It owns
brands of specific private label which provides great brand equity in the market. Tesco follows
new advancement in innovations and techniques of packaging that provides unique position in
minds of consumers. Tesco has around 6500 stores in 14 countries across the world. It has high
strengths for its marketing innovations and strategies of advertising. Its financial strength is
observed in FTSE Index. Tesco has maximized diversifications in global regions for expanding
its business worldwide.
Weaknesses of Morrison
Morrison has reached limited geographic regions as compared to other large brands. It’s
so called past issues related to the rights of farmers has affected the image of Morrison. Lack of
online presence is a huge problem for Morrison.
Weaknesses of Tesco

Tesco faced controversies that built some issues. It has its limited presence in countries
that are emerging as compared to other organizations.
Opportunities of Morrison
Growing market for providing organic products can be tapped by the Morrison.
Expansion of its stores internationally can boost and expand the overall business of Morrison.
Raised demand for private labels can be served by the organization. Connections of small
companies & strategic partnerships can support its business to grow effectively. According to
IGD (2018), the United Kingdom market of food and grocery forecast to grow by 14.8%
between now and 2023,by giving it a high value. It is a great opportunity for Morrison to make
possible efforts for the expansion further in the United Kingdom. Likewise, Expanding in
international markets is also has high worth of exploring.
Opportunities of Tesco
Tesco can plan to make entry in markets that are emerging and expand its area of its
operations. It takes advantages of digital media to make expansion of its reach. Acquisition of
collaborations and small companies can support to boost Tesco’s business.
Threats of Morrison
Competitors increased market share of competitors can put high impact on the margins of
Morrison. These challenging competitors are capable to overtake Morrison in the future.
Maximized taxes and modifications in policies of United Kingdom government is the big threat
for Morrison. E-commerce companies increased businesses can affect the business of its physical
stores of grocery in retail industry.
Threats of Tesco
Constant innovation in competitive organizations can be implemented that are required to
achieve success. High taxation and Government policies can affect operations of Tesco.

P6 Interrelationships of strengths and weaknesses of organizations with its External macro
factors
PEST analysis and SWOT analysis are usually discussed separately because they both are
dissimilar. They have their own strengths and utilizations for its conditions, , but both are rarely
mixed. PEST analysis examines external factors that company can’t directly influence: political,
economic, social, and technology. Morrison cannot interfere or modify any of it without putting
force tremendously (Shtal and et.al, 2018).
These factors exist within Morrison and it cannot forget that essential factors play a critical role
in the growth of any product or business. If Morrison do not abide by factors norms, it may
suffer by harsh time. By combining the information Morrison have and outlines the concerns
from the relationships of two analysis it can grasp both external factors influences (on a macro-
level) and internal factors (on a micro-level). Even though Morrison can’t influence PESTLE
factors, it can take benefits of it by implementing SWOT analysis. Relationship between them
can put Impact on economy and make modifications in norms and regulation Morrison.
Political stability PESTLE collaborates strongly with the SWOT’s threat components, but also
has relevant assessment of opportunities. They can build mitigation of risk and are usually
utilized together to support effective decision-making, action and strategic planning. SWOT and
PESTEL are cost and time relevant that means they highlight key issues related to the context
which cannot be identified, addressed and could crucially affect the chance of success. Both of
them offer the benefit of framing certain issues in an easy way to understand and discuss. If the
objectives of Morrison seem that they are not clear, then they have to agreed and clarified before
embarking SWOT analyses
CONCLUSION
After analysing the total business environment, this report concludes that the different types of
organizations and their purposes that are characterized into different sectors according to their
size and scope. This report demonstrated the interrelationships of various functions in
organizations and their links with its structure. It defines the positive and negative impacts of

macro environment on the operations of business. This report analyses the external and internal
factors of some specific organizations to recognize business strengths and weaknesses by using
some theories to set unique goals. This report also analyses the interrelations of strengths,
weakness and external macro factors.
REFERENCES
Books and Journals
Beneke, J., and et.al., 2016. The impact of market orientation and learning orientation on
organisational performance. Journal of Research in Marketing and Entrepreneurship.
Coetzee, P. and Erasmus, L.J., 2017. What drives and measures public sector internal audit
effectiveness? Dependent and independent variables. International Journal of
Auditing. 21(3). pp.237-248.
Galli, B.J., 2018. How Economic Decisions Are Made in Public vs. Private Sectors: A
Comparison of Methods. International Journal of Strategic Engineering
(IJoSE). 1(1). pp.38-47.
Haleem, F. and Jehangir, M., 2017. Strategic Management Practices by Morrison PLC, UK.
Analysis, Lessons and Implications. Middle East Journal of Business. 55(4182). pp.1-
7.
Phadermrod, B., Crowder, R.M. and Wills, G.B., 2019. Importance-performance analysis based
SWOT analysis. International Journal of Information Management. 44. pp.194-203.
Pollack, S.W., Skillman, S.M. and Frogner, B.K., 2020. Assessing the Size and Scope of the
Pharmacist Workforce in the US. Center for Health Workforce Studies, University of
Washington.
Prexl, K.M.,and et.al., 2020. Exploring the Individual: An Empirical Investigation of
Interrelationships between Dimensions of Absorptive Capacity. International Journal
of Innovation Management 24(05). p.2050077.
Sahibzada, U.F., and et.al., 2020. Refuelling knowledge management processes towards
organisational performance: mediating role of creative organisational
learning. Knowledge Management Research & Practice, pp.1-13.

Sarsby, A., 2016. SWOT analysis. Lulu. com.
Shtal, T., and et.al., 2018. Methods of analysis of the external environment of business activities.
Teer, J.G. and Drawe, D.L., 2019. Size and Scope of the Market. Sheep And Goat
Handbook.4.p.27.
Weisinger, J.Y., Borges-Méndez, R. and Milofsky, C., 2016. Diversity in the nonprofit and
voluntary sector. Nonprofit and Voluntary Sector Quarterly. 45(1_suppl). pp.3S-27S.