Unit 1: Business and the Business Environment - Tesco Case Study

Unit 1: Business and the Business
Environment
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Table of Contents
Introduction......................................................................................................................................4
LO1 Explain the different types, size, and scope of organisations..................................................5
P1 Explain different types and purposes of organisations; public, private and voluntary sectors
and legal structures......................................................................................................................5
P2 Explain the size and scope of a range of different types of organisations.............................7
M1 Analyse how the structure, size, and scope of different organisations link to the business
objectives and product and services offered by the organisation................................................9
LO2 Demonstrate the interrelationship of the various functions within an organisation and how
they link to organisational structure..............................................................................................10
P3 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure......................................................................................10
M2 Analyse the advantages and disadvantages of interrelationships between organisational
functions and the impact that can have on organisational structure..........................................12
D1 Provide a critical analysis of the complexities of different types of business structures and
the interrelationships of the different organisational functions.................................................13
LO3 Use contemporary examples to demonstrate both the positive and negative influence/impact
the macro environment has on business operations.......................................................................14
P4 Identify the positive and negative impacts the macro environment has on business
operations, supported by specific examples..............................................................................14
M3 Apply appropriately the PESTLE model to support a detailed analysis of the macro
environment within an organisation..........................................................................................18
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LO4 Determine the internal strengths and weaknesses of specific businesses and explain their
interrelationship with external macro factors................................................................................20
P5 Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses..........................................................................................................20
P6 Explain how strengths and weaknesses interrelate with external macro factors..................22
M4 Apply appropriately SWOT/TOWS analysis and justify how they influence decision-
making.......................................................................................................................................24
D2 Critically evaluates the impacts that both macro and micro factors have upon business
objectives and decision-making.................................................................................................25
Conclusion.....................................................................................................................................26
References......................................................................................................................................27
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Introduction
For every business organisations, it is highly important to consider both internal as well as
external environment before taking any decision related to business activities. Operational
activity and profitability get affected by external and internal factors so it is essential for the
company to give focus on employees, suppliers, management, demand, supply, business
regulation, competitors etc. This project report is based on Tesco which is a multinational
company in the United Kingdom. It is largest merchandise retailer and grocery organisation that
offer high-quality products to customers. This organisation faces tough competition from its
competitors such as Morrison’s, ASDA, Sainsbury’s etc. This report is categories into four
sections in which the first section examined various different types of an organisation like the
public, private and voluntary. The second part has been analysed the different purpose of public,
private and voluntary sectors with their legal structures. Pestle analysis has been examined in this
report that helps the company to identify all factors that affect its operations. In the fourth
section, external and internal factors have been discussed to analysis the strengths as well as
weaknesses of the company.
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LO1 Explain the different types, size, and scope of organisations.
P1 Explain different types and purposes of organisations; public, private and voluntary
sectors and legal structures
There are various different types of organisation which are a sole trader, partnership, and limited
organisation. These are discussed as under:
Sole trading organisation: This type of organisation is owned by the only single person who is
liable for all profit as well as loss. In this, all responsibilities and liability of the company depend
on the single person. It is also known as a sole proprietorship because it is operated and owned
by one person who does not need to follow any kind of legal structure. The biggest advantages of
a sole proprietorship are that he will bear high profitability individually and the biggest
disadvantages are that if the company get loss then he will be a single person who is liable for it
(Yüksel, 2012).
Partnership organisation: When two or more person ready to share their profit and loss equally
and ready to make contract then it is known as partnership organisation. There are so many
advantages of partnership firms such as they do not require paying income tax separately, high
profitability and productivity, capture more market share, great ideas, and thoughts. Partnership
business assists to increase the revenue and sales in the large competitive marketplace. Apart
from this, there are various disadvantages of a partnership like the chance of conflicts arises
between partners, not the clear transparency of shares, limited capital and many more.
Purposes of the organization are as follows:
Types of organization Purposes of the organization
Public SECTOR It is healthcare organisation which offers high-quality healthcare
facilities and services in the United Kingdom. The major aim of
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(National Health Service) National Health service is to fulfil needs of people and deliver
free services to those people who unable to afford treatment.
There are huge numbers of employees who are employed in the
organisation for achieving set goals and objectives in the certain
time period.
Private SECTOR
(TESCO Company)
It is largest grocery and merchandise retailer organisation in the
United Kingdom which offers high-quality goods and services to
customers. The main objective of Tesco is to provide products
according to the market as well as customer’s requirement for
enhancing their level of satisfaction (Writing, 2017). It is a
private organisation which has the main motto to earn high-profit
margin and sale.
Voluntary SECTOR
(Red Cross)
The British red cross is a non-profit organisation which works
for the welfare and benefit of the society. It is a voluntary
organisation which does not have main aim to earn high
profitability. This organisation provides so many services to
fulfil the requirement of people and society.
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