Business and the Business Environment: A Report on Arcadia Group

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Business and the Business Environment
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Table of Contents
Introduction......................................................................................................................................3
LO1 and LO2- Report......................................................................................................................4
Introduction..................................................................................................................................4
Task 1...........................................................................................................................................4
Task 2...........................................................................................................................................6
Conclusion...................................................................................................................................9
LO3 and LO4- Report....................................................................................................................10
Introduction................................................................................................................................10
Task 3.........................................................................................................................................10
Task 4.........................................................................................................................................13
Conclusion.................................................................................................................................16
Conclusion.....................................................................................................................................17
Reference List................................................................................................................................18
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Introduction
Business involves the efforts of an organisation to deliver the services and goods to the
customers for earning income. A business operates in a changing environment that affects its
operations and decision-making. Arcadia Group Ltd. is a private company that falls in the retail
industry. This firm has been established in 2002. The headquartered of the organisation is in
London, UK. At present, the Finance director is Paul Budge, CEO is Ian Grabiner, and Sir Philip
Green is the chairperson. The products traded by this organisation are accessories, clothing as
well as footwear. There are many subsidiaries of this corporation, such as Burton, Miss
Selfridge, Topshop, and others. In this report, there will be an explanation on various types of
organisations with the emphasis on their structures, size and scope. The different functions of the
chosen firms will be assessed as well. The Discussion on the macro and micro factors of
environment will be provided as well as their connection with the firm’s decision-making
process will be evaluated.
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LO1 and LO2- Report
Introduction
The provided report will have a discussion on different forms of organisations. The positive and
negative influences of their legal structures will be provided. The various organisational
structures will be explained, and their link with the structures of the organisation will be
discussed.
Task 1
Develop a report about different types of organisations such as private, public or
voluntary. You must highlight advantages and disadvantages along with some difference
such as the size, scope, legal structure and objectives of these organisations. Discuss if these
organisations operate in the primary, secondary, or tertiary sector.
Private
The person owns the private companies, and the objective of such a business is to make a profit.
The advantage of the private organisation is that it provides benefit to the investors, shareholders,
and the members who have ownership in such firms. The advantage of such a company is that it
is a limited liability and the loss in business will affect the investors. One of the examples of the
private organisation is Arcadia, a British retail company. The objective of this firm is to earn
profit within the targeted timeframe by providing quality goods to the consumers. The
employee's size of this firm is 22, 000 (arcadiagroup.co.uk, 2019). The scope of Arcadia is high
as it has functions in different countries such as the US, Ireland, and others. The legal structure
of this organisation is of a private limited company. This legal structure prohibits the members of
the company to trade the shares in the public. The company falls in the secondary sector as it
provides finished products to the customers.
Public
The country’s government owns the organisations in the public sector. The advantage of this
organisation is that it is operated with the resources generated from the tax of the people. The
disadvantage of this company is that it lacks innovation. “Metropolitan Police Service” is one of
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the organisations that fall in the public sector. The objective of MPS is to provide service to the
native citizens by protecting them and embassies as well as palaces of the country
(met.police.uk, 2019). The size of personnel of this corporation is 43, 000 (met.police.uk, 2019).
The scope of this agency is within the UK that is England, Scotland, Wales as well as Northern
Ireland. The legal structure of this firm is a general partnership. As per this legal structure, the
members of the organisation would share the profit as well as responsibilities together. MPS falls
in the tertiary sector as it provides intangible services to the people.
Voluntary
Trustees run the organisations in the voluntary sector. The objective of such a firm is to help the
society. The objective of the public organisation is to benefit the society by providing them with
services and goods. The disadvantage of such a company is that it is dependent on other
companies for donation. “Action for Children” is a voluntary company that provides charity to
the vulnerable people in the UK. The objective of “Action for Children” is to provide essential
services to young people and children of the native country (actionforchildren.org.uk, 2019). The
size of this company is 7, 000 (charitycommission.gov.uk, 2019). The scope of this business is
within the country. The legal structure of this firm is of a charity and ‘company limited by
guarantee’ (actionforchildren.org.uk, 2019). This legal structure would enable the company to
make contracts with another organisation. However, this legal structure would make the action
for children to make expenditures on the formality of submitting filings to the Charity
Commission. “Action for Children” falls in the tertiary sector as it delivers insubstantial service
to the native citizens.
Organisations’ comparison based on their size:
Micro
One of the micro businesses in the UK is “Turtle Tots”. It provides swimming lessons for the
toddlers (turtletots.com, 2019). The legal structure that this company follows is that of a private
limited company. The size of this organisation is less than 10 employees. The annual revenue of
this firm is less than 2 million pounds. The scope of this firm is within the country.
SME’s
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In the United Kingdom, one of the medium sized businesses is “Orion Electrotech Limited”. It
provides recruitment services to the people. The legal structure of the company is of a private
limited company. The size of the employees is within 250. The annual turnover of this firm is
within 50 million pounds. The scope of this firm is in the boundaries of the country.
Large
Among the large organisations of UK is Arcadia Group, a retail company. Its legal structure is
that of a private limited company. The size of the employees is more than twenty thousand. The
annual revenue is more than one billion (craft.co, 2019). The scope of this particular firm is
beyond the boundaries of the UK.
Task 2
Provide an analysis of two types of organisations structures and discuss the relationship
between the different organisational functions/departments. How they link to
organisational objectives, structure, and use an organisational chart to help your discussion
in answer.
There are some organisational structures such as functional, divisional, flat, and others. In the
functional structure, the roles of the company are divided into groups. In every department, a
manager is in charge of managing the workforce of the specific department.
Advantage of functional organisational structure
 The workers are allocated tasks as per the functions and the skills they possessed.
 The firm is benefitted by employing the expertise in each field for taking the specific job
roles.
 This structure enhances the productivity because of the focus on each function.
The disadvantage of functional organisational structure
 It lacks communication with other departments.
 There can be management issues due to the control if the managers over the functions of
the staffs.
 In this structure, innovation is lacked due to the activities allocated by the managers.
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In the divisional structure, the division is created to operate on its own, which included
maintenance of resources and such activities. The geographical division is a part of this structure
in which division is created as per the geographical region.
Advantage of divisional organisational structure
 It offers flexible working condition as each division operations are reported to the
management of that particular division.
 The working culture of each division in this organisational structure is enhanced.
The disadvantage of divisional organisational structure
 There can be issues regarding the management of resources.
 This structure increases the cost of the business.
Various functions in Arcadia Group have a connection with its organisational structure. The
structure of the Arcadia is functional. In this structure, the division is based on the functions
such as finance, human resource, digital, technology. Communication, store and property
development, supply chain, supplier management, customer care, loss and audit prevention,
group purchasing, legal team, and facilities such as security, cleaning, maintenance, reception,
travel, and others (arcadiagroup.co.uk, 2019). Every member of each departments focuses on
meeting the objective of the business. The functions have a connection with each other such as
the human resource department recruits labour force for every department. The finance
department invests in other functions of the firm. The technology department employs IT
services such as online mode of shopping facilities to the customers to earn a profit, a major
objective of the business.
The digital team provides the customers with services in different languages in different
countries. Every brand or subsidiary of the company such as Topman, Evans, Wallis, Dorothy
Perkins, and others has apps to be used by the consumers. The campaigning, media events, and
such activities are done by the communication team. The property development function
includes enhancing the working environment of the firm as well as to improve the customers’
experience by beautifying the outlets. The team members of supply chain supply the products
from one place to another. There are several distribution centres of the firm in different
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CEO
Finance Human
Resource
IT Digital Communication
Manager Manager Manager Manager Manager
Staffs Staffs Staffs Staffs Staffs
countries, and this team carries out their functions. The management team to source the resources
runs the management of supplier. The customer care provides services to the consumers 24/7
globally. The team of loss prevention controls the stock. The purchasing team includes activities
such as packaging, designing, printing, as well as making posters for promotion. The facilities
team monitors the head offices by looking after the cleaning, reception, security and other areas.
The legal team provides advice concerning the limit on promotion by the use of commercial,
corporate governance, and such important matters.
(Source: Created by the learner)
The functional structure of the firm allows the members of the firm to organise the functions
into groups. There is a connection between the various functions such as the technology and
digital departments help in the marketing of the commodities. The communication department
also assists the company in the same purpose. All of the diverse sections of marketing are
connected with each other as well as get assistance from the finance department. The purchasing
team manufactures the packages that would be needed to package the commodities. Thus it is
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Figure 1: Organisational Chart of Arcadia Group Ltd

connected with the sales department. The legal team provides advice on maintenance of rules
and policies in every department such as judicial use of technology, appropriate marketing
techniques, and such. In this way, there is a connection between different departments. The
functional structure enables the Arcadia Company to increase the effectiveness of different
operations. The manager of each department reviews the work carried out by the staffs. It helps
in having an appropriate result from each department. The employees are given the tasks of each
functional department based on their knowledge and experience, this it simplifies their work and
allowing the firm to enhance the marketing of the products with enhanced value.
However, there is a disadvantage of this organisational structure for the firm. The members of
the company would not be able to make effective communication because of the division based
on departments. The information of each department could not be shared among each other that
can be essential for them. However, the connection between the departments can affect the firm
negatively as well if anyone department fails to do the work properly. For instance, if there were
a failure in the IT system in the marketing of the commodities, the business would fail in meeting
the objective. The lack of an effective budget plan would result in wastage of resources in the
activities such as marketing, packaging, and others. In this way, there are some positive as well
as negative influences of the interrelationship of the organisational functions.
Conclusion
The conclusion can be made from the report provided above is that there are several kinds of
organisations based on their size and types. There has been a discussion on their legal structures
as well as employees’ strength and scope. The objectives of the firm have been explained along
with the diverse functions of the chosen company, Arcadia. Its organisational structure has been
provided to have an understanding of how the functions are divided.
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LO3 and LO4- Report
Introduction
The given report will provide analysis on the external and internal factors of the environment
that can affect the business of Arcadia Group. Their interrelationship will be explained as well as
there will be a discussion on their influence on decision-making.
Task 3
Write a report to identify real contemporary examples and demonstrate both the positive
and negative influence/impact the macro environment has on business operations. Use the
PESTEL tool to highlight this in any industry of your choosing
Factors Description Effects on Arcadia Group
Political Brexit would increase the cost of
trade for the retailers (Owens,
2017).
Brexit has created havoc in
employment of the EU workforce.
The value of pound has been
reduced that can decrease the
exchange rates from the foreign
countries.
The change in the trade
agreements due to Brexit would
increase the cost of the business.
This would affect Arcadia in a
negative way, as there would be
extra expenditure on trading
goods.
The restriction in employing the
workers from EU nations would
make the Arcadia recruit form
the national country that would
increase the cost to fill the
positions left vacant by EU
workers.
The change in the value of
currency would influence arcadia
negatively as there would be less
profit in dealing with the foreign
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customers.
Economic The economic growth rate of UK
has been increased by3% that is
from 0.2% in March 2019 to 0.5%
in May 2019
(tradingeconomics.com, 2019).
The rate of inflation has seen
reduction from 2.48% in 2018 to
1.80% in 2019 (in2013dollars.com,
2019).
The unemployment rate of the
United Kingdom has been dropped
by 1% from 3.9% in April 2019 to
3.8% in May 2019
(tradingeconomics.com, 2019).
The rise in the growth rate of
UK’s economy would be
profitable to the Arcadia Group
as there will be increase the
capacity of purchasing by the
customers. The company in this
way can sell more number of
goods and make more profit.
The reduction in the inflation
rate of the U.K would increase
the purchasing power of the
citizens. Arcadia will be able to
make sales of more number of
goods.
The reduction in the
unemployment rate would let the
company employ skilled people
from the nation. he increase in
the opportunity of working
would increase the participation
of members in work as well as
there would be increase in the
capacity of buying by the people.
In this way, the employment of
the country would have a
positive influence on the firm.
Social The buying habits such as based on
the occasions or profession affect
the retail business.
The preference of online shopping
The buying habits would affect
the company’s profit as the
products sold by the firm are
mostly fashionable garments and
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by the young generation has been
increased.
dies not provided traditional
apparels.
The increase in the online trend
of shopping would have positive
influence on Arcadia as it has
started selling the commodities
through online method.
Technological Technology has assisted the retail
company in UK by enhancing its
selling methods (Fernie and Sparks,
2018).
It has also contributed in managing
the supply chain with less cost.
The use of technology on marketing
of the commodities is immense.
The retail companies use the
advanced technology to enhance
the users experience by providing
them with personalisation services.
Arcadia can use the help of
technology to improve its online
features.
Arcadia can use the technology
to develop the management of
supply chain to reduce the cost
of the business.
Arcadia group can improve the
marketing activities with the use
of technology in promotion of
the commodities.
Arcadia should boost the
experience of the customers by
using personalisation service.
This would also be helpful in
enhancing the brand’s image.
Environmental As per the “Climate Change Act
2008”, the companies of the
company should control the
emissions of harmful gases
(legislation.gov.uk, 2019).
The “Environment Act 1995”
regulates the activities of
companies of nation by controlling
Arcadia would be affected by the
environment legislation of the
government of UK such as the
act of climate change. The firm
to avoid legal penalty should
monitor the gas emissions in the
transportation of the goods.
Arcadia would be under the
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