Unit 1 : Business Environment

Unit 1

Table of Contents
INTRODUCTION...........................................................................................................................1
Main Body.......................................................................................................................................1
Conclusion.......................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Aggregation of internal as well as external factors like needs of customers, their
expectations, employees, management supply & demand, suppliers, clients, governmental
activities, innovation within technology, etc. is known as business environment (Chetwood and
et. Al, 2014). It is crucial for an organisation as it assists them to evaluate business opportunities
and accordingly make changes to that. In this Costa Coffee is taken into consideration, which is
a British multinational coffee house and was founded in 1971. they furnish their services
worldwide. This further contains different types of organisations, their size and scope and
relationship between various organisational functions. Along with this, it contains advantages
and disadvantages of organisational functions.
Main Body
Private organisations are defined as sector which is operated by individuals, franchises or
in a partnership. Costs Coffee was founded by Bruno and Sergio Costa with its headquarter in
Dunstable, Bedfordshire. They provides customers with products like coffee, tea, iced drinks and
sweet snacks. As Costa Coffee is British coffee house, they provides wide range of products to
their customers at reasonable prices which are affordable. Their major purpose is to furnish high
quality services by which they can make a remarkable spot in minds of people (Crane and
Matten, 2016). By this they can gain loyalty of customers which will lead them to sustain within
market for longer duration of time. The legal structure of private organisation comprises of
partnership and sole proprietorship. Partnership refers to formal agreement among two or more
individuals within a business. They can be either general and limited partnership. On the other
hand sole proprietorship denotes that business is completely controlled, managed and owned by
an individual.
Organisations which works under private sector and are funded by governmental
companies or groups to carry out their business operations are referred to public organisations.
With respect to this, Crown Prosecution Services is public prosecution agency which is present
at Wales and England. They are responsible for providing legal advices to investigating agencies.
The major purpose of Crown Prosecution is furnish effectual and correct advices so that right
prospectives can be brought in with respect to criminal proceedings. The legal structure of public
organisation comprises of local, national and state government, as they are controlled by
1

government. Each of these structures are controlled and managed by respective authorities Like
In context of local government , they are being managed by local authorities and so are the others
(Gharajedaghi, 2011).
Non-profit groups which carry out their operations for welfare of society, individuals and
to serve humanity are known as voluntary organisation. Oxfam is a non-governmental which
furnishes their services for eradication of poverty, relief from disaster, pro-migration and policy
research. There major purpose is to eliminate poverty from the world by which living standards
of individuals can be improvised concurrently. There legal structure comprises of three legal
structures, they are unincorporated association, trust and company limited by guarantee. When
an agreement occurs among group of individuals who are working together to attain a common
purpose are unincorporated association. Trust refers to formal agreement among among diverse
parties as well as a trustee who is holding right to property. Within company limited by
guarantee there exists limited number of members and shares within organisation.
As the different types of organisations have defined above, the following section will be
containing size and scope of these firms by taking into consideration two organisations. In
context of private organisations, they are owned by individuals or group of people (Gilboy,
2016). Costa Coffee is a multinational company which renders there services worldwide which
denotes that there size is large. They have there around 3882 outlets in 31 countries. They have
the scope to extend their menu as well as increase number of outlets. It has became the second
largest coffee house chain within world. Starbucks is an American coffee company as well as
large chain of coffeehouse. They are represented as second wave coffee which have
distinguished them from other competitors within market. There size is large which is indicated
by their services which are provided worldwide. They have around 2,91,000 employees in
around 30,000 outlets. They provides there customers with products like baked goods,
smoothies, coffee beverages and sandwiches. As they are already providing their services around
the world, they need to increase items on menu and must maintain the standard of services which
are being provided to customer.
With respect to public organisations which denotes that organisation is partially or wholly
owned by government authorities (Kian Chong, Shafaghi and Leing Tan, 2011). In context of
Crown Prosecution Services they provides services related with legal advices. There size is
around 6000 employees who are furnishing there services as 14 different regional teams that are
2

leaded by Chief Crown Prosecutor. Crown Prosecution Services render there services in England
and Wales. There scope is vast, like they can make use of digitalisation through which flow of
information can become fast and this will also improvise their quality of advising (Vaiman,
Sigurjonsson and Davidsson, 2011). National Health Service (NHS) is a public organisation
which are responsible for understanding individuals and furnish them with high standard of
excellence and professionalism. There size is vast, around 1.4 million employees. They provides
primary medical facilities and services to people. They have broad scope as they can also start
providing services to people from different countries like London, Switzerland and many others.
In context of voluntary organisations, two firms which are taken are Oxford Committee
for Famine Relief (OXFAM) and Cancer Research UK. Oxfam is a charitable organisation which
is responsible for raising funds for affected people. There size is 20 charitable organisations that
are independent and they possess around 32.9% market share. Along with they provide services
within 14 different countries. Furthermore, they they have large number of volunteers from
diverse location for offering their services (Türetken and et. al., 2011). Oxfam can enhance their
scope by rendering services within locations which are unreached and untouched by welfare
services. Cancer Research UK is a cancer awareness and research charity within United
Kingdom and was brought on February 4, 2002. They aims at reduction of deaths which are
caused from cancer. There size is large as they comprises of around 3,964 employees and around
40, 000 volunteers. They have the scope to extend their services in other counties also by which
they can aid cancer patients.
The organisation vary in size, they can be either small, medium or large. Small
businesses are held by family members and founder, they are completely responsible for decision
making. Small businesses make use of informal processes to do things. Most of the capital needs
are met by taking into consideration net worth (Kaufmann, Kraay and Mastruzzi, 2011). But the
major drawback is that they have limited number of development opportunities. On the other
hand, medium businesses are owned either family members and some public. Along with this,
professionals and owners play key roles whereas decisions are made by CEO and key leaders
with respect to long term planning. They also do not have complete formal process for carrying
out things. Furthermore, customer base is also limited within niche industry. With respect to
large businesses, they are mostly held by investor which are public and managed by professional
management. Apart from this, business is managed by professionals and decision making is
3

carried out as per organisational hierarchy. In this entirely formal structure is is adopted and they
have wide sources of funds. All these businesses aims at attaining goals as all of them enters
within a market to gain profit (Li and et. al., 2011). Depending upon the requirements of
customers, their size, products furnished by them, etc. makes differences among their goals as
well as objectives (Tayur, Ganeshan and Magazine, 2012).
There exists certain forces within market they can be either internal or external. Internal
factors comprises of strengths, weaknesses, opportunities and threats which are possessed by
Costa Coffee. They need to analyse these factors so that effectual results can be obtained. Like,
Starbucks is strong coffee house within market, Costa Coffee can make use of their strengths
such as well qualified employees and by providing training to them their performance can be
enhanced which will lead them to acquire more market shares. This also depicts that they are
making use of opportunities which are present with them. When external factors are taken into
consideration, they comprises of political, economical, social, technological, legal and
environmental factors. These factors hamper the operations of organisation in both positive as
well as negative manner. Like if in some country rate of interest is high then it will lead to loss
for organisation but it might not be same in other country. Costa Coffee can ensure that services
are carried out in those countries where there is stability in terms of politics and economical
situations prevailing (López-Gamero, Molina-Azorín and Claver-Cortés, 2011).
There exists different kinds of departments within organisation which are responsible for
carrying out their operations and activities. These all departments work in collaboration with
each other for carrying out their operations without any kind of problem. Within Costa Coffee
there exists different departments which are responsible for carrying out their operations through
which productivity can be improvised. Marketing and finance department are crucial part of
company as firm cannot carry out their operations without capital which is maintained by finance
department. The major goal of Costa Coffee to to increase their funds and develop their
performance. Departments have certain accountabilities which interconnects them with
marketing functions which assists in attaining capital by utilisation of sources. On the other
marketing and research& development focus on effectual knowledge of requirements of
customers this leads them to make their work more simpler so that desired outcomes in terms of
profitability can be attained (Meiners, Ringleb and Edwards, 2014). The information which is
obtained by marketing manager aids manager of research and development to carry out suitable
4

research by which effectual results can be attained. Both works in coordination with one other to
understand fashion and trends to increase end result. Management of Costa Coffee needs to
formulate strategic decision with respect to facilitating information for both employees and
management by which relevant modifications can be carried out (Saleem, 2017). Operations and
production department are responsible for carrying out operations of Costa Coffee and the other
department is furnish end product.
These interrelations furnishes high quality services when they work in collaboration with
each other. When positive aspects are taken into consideration then it will lead them to have
desired results like if marketing department is carrying out market research then information
provided by them will aid production/ operations, R&D department to carry out their operations
as per requirements of customers this will lead them to enhance overall profitability of Costa
Coffee. On the other hand when work is carried out together then conflicts can also arise. For an
instance, if marketing department needs budget for carrying out market analysis then they can
give their requirements to finance department. But it is possibility that there may arise conflict as
the later may try to minimise or cut down cost. Their are probable chances that conflicts will
arise (Sekaran and Bougie, 2016).
Conclusion
From above it has been concluded that business environment plays crucial role within
every organisation. There exists different types of organisation which varies in size and scope.
Along with this, there legal structure also varies and the way in which they carry out their
operations are also different from one another. Diverse department works in collaboration with
each other, this facilitates them to carry out their operations in effectual manner through which
productivity as well as profitability can be enhanced.
5

REFERENCES
Books and Journals
Chetwood, M. K. and et. al, 2014. Transforming a legacy IT infrastructure into an on-demand
operating environment. U.S. Patent 8,775,232.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Gharajedaghi, J., 2011. Systems thinking: Managing chaos and complexity: A platform for
designing business architecture. Elsevier.
Gilboy, G. J., 2016. The myth behind China's miracle. In SEEKING CHANGES: The Economic
Development in Contemporary China (pp. 1-16).
Kian Chong, W., Shafaghi, M. and Leing Tan, B., 2011. Development of a business-to-business
critical success factors (B2B CSFs) framework for Chinese SMEs. Marketing
Intelligence & Planning. 29(5). pp.517-533.
Kaufmann, D., Kraay, A. and Mastruzzi, M., 2011. The worldwide governance indicators:
methodology and analytical issues. Hague Journal on the Rule of Law. 3(2). pp.220-
246.
Li, Q. and et. al., 2011. Towards the business–information technology alignment in cloud
computing environment: anapproach based on collaboration points and agents.
International Journal of Computer Integrated Manufacturing, 24(11) pp.1038-1057.
López-Gamero, M. D., Molina-Azorín, J. F. and Claver-Cortés, E., 2011. Environmental
uncertainty and environmental management perception: A multiple case study. Journal
of Business Research. 64(4). pp.427-435.
Meiners, R. E., Ringleb, A. H. and Edwards, F. L., 2014. The legal environment of business.
Cengage Learning.
Sekaran, U. and Bougie, R., 2016. Research methods for business: A skill building approach.
John Wiley & Sons.
Saleem, M. A., 2017. The impact of socio-economic factors on small business success.
Geografia-Malaysian Journal of Society and Space. 8(1).
Tayur, S., Ganeshan, R. and Magazine, M. eds., 2012. Quantitative models for supply chain
management (Vol. 17). Springer Science & Business Media.
Türetken, O., and et. al., 2011, June. Enforcing compliance on business processes through the
use of patterns. In ECIS (p. 5).
Vaiman, V., Sigurjonsson, T. O. and Davidsson, P. A., 2011. Weak business culture as an
antecedent of economic crisis: The case of Iceland. Journal of Business Ethics. 98(2). pp.259-
272.
6