Report on ASDA's Business Environment and Operations

This report provides a comprehensive analysis of ASDA's business environment. It begins by defining different types of organizations, including public, private, and voluntary sectors, and examines their purposes. The report then delves into the size and scope of various organizational types, such as micro, small, medium, and large scales, and their objectives. It explores the relationships between organizational functions like HR, marketing, finance, and operations, highlighting their interdependencies. Furthermore, the report assesses the positive and negative impacts of the macro environment on ASDA's operations, using PESTEL analysis to evaluate political, economic, social, technological, environmental, and legal factors. The analysis considers ASDA's structure, functions, and the external influences shaping its performance in the retail sector. This report is useful for students studying business and related fields.

Business Environment

Table of Contents

INTRODUCTION
Business environment refers to comprises various type of companies and components
which directly or indirectly influence on activities of firm. Shareholders, employees, suppliers,
customers and competitors are various internal factors which influence operations. Government,
technological and environment are external elements which executive consider while designing
system and also conduct functions on the basis of situations of market. This given report is based
on ASDA that is famous retail store situated in United Kingdom and different other nations. This
is subsidiary of Walmart which provides different grocery items, food products and various other
things to have large customer base (Mahmood and Hanafi, 2013). This assignment specifies
different types and purpose of organisation that is public, private and voluntary which vary with
each other in respect to size and scope. Company has different department which has
interrelationship and help administration to accomplish objectives. Positive and also negative
affects of macro environment are identified through external and internal analysis to
acknowledge strengths and weaknesses.
TASK 1
P1 Different types and purposes of organisations
NGO and NPO are various firms which are set by individuals to deliver items and services in
market in according to needs and wants of people. These firms don't have aim to generate
revenue but to conduct activities for welfare of society. Thus, these are various aspects which has
large number of enterprises that execute operations to accomplish their goals and objectives
(Commander and Svejnar, 2011).
Basis of
Comparison
NGO NPO For Profit
Meaning Non-government
organisation are firms
which are started by
individuals to deliver
adequate items and
services in society for
welfare of people.
Non-profit firms are
those enterprise which
provide products to
customer to fulfil their
demands and generate
revenue which is
invested again in
This concept define
companies which are
established by people to
utilise funds and deliver
appropriate things in
market to gain profit from
business.
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business.
Area of
Operations
NGOs conducts large
scale activities.
Limited scale of
operations are executed
by NPO.
Both large and limited area
of activities.
Objectives Main aim of this kind of
sector is to enhance and
develop society; thereby
improve economy of
country.
This sector objective is
to promote science, art
and commerce by
conducting appropriate
activities.
Profit organisation prime
goal is to generate large
amount of revenue from
business by enhancing
customer base and sales.
Market has different types of organisation which require to function in according to
Public Sector: This tactic includes firms which require to be managed and function in respect to
government. It is essential that administration design system and formulate strategies in
according to rules and legislations of authorities.
Purpose: This sector comprises organisation which are established with objective to
deliver appropriate items and services in market for welfare of society. Along this, management
even increases employment opportunities to provide appropriate chances to people to generate
money for maintaining their living standards (Cronan and et. al., 2011).
Private Sector: This concept includes companies which are started and operated by
individuals to utilise funds and execute effective techniques and technologies in system to
provide products or services on the basis of needs and preferences of customers. ASDA is private
firm which has retail firm situated in United Kingdom and different countries. Management
offers various grocery, food, clothes and other things to grab attention of people by giving them
variety of choices.
Purpose: Private firms goal is to give different services and products to attract large
number of people by giving them things in respect to their taste and preferences. Executive
require to establish good position and image in market to generate adequate profit from business.
Voluntary Sector: This sector comprise organisation which are operated by individual to
provide items and services for completion of needs and wants of public. Oxfam is firm in which
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executive design system to gain adequate profit which can be invested back in business to
conduct operations effectively (Dahan and et.al., 2010).
Purpose: These companies objective is to provide things and opportunities to people to
earn appropriate money for regulating and managing living standards.
Legal Structure: Public and private sector firms require to follow guidelines and make system
function in according to regulatory bodies.
Public sector: State government: This is an effective discrete organisation that objective is for
government standards with administrations and some of the other items in commercial
centre for an economical advancement (Fernando, 2011). Local government: This form of authority require to organise business for welfare of
society. Local commodities is essential factor which organisation provide on the basis of
demands and needs of individuals.
 Central government: This sector comprises firms which are set up by authorities to
make system function in according to both state and local government.
Private sector: Sole Proprietorship: This concept includes firms which are established and controlled by
single persons to conduct business and operations in such manner that individual is able
to generate appropriate profit from business.
 Partnership: Two or more people comes into agreement to share assets, funds and skills
to execute business activities to gain adequate revenue.
P2 Size and Scope of various types of organisations
Market has large number of enterprises which differs with each other in context to scope,
size, structure and objective. Small, micro, medium and large are different organisation forms
which exist to utilise funds and deliver appropriate items and services in according to needs and
wants of people. This is description of different types of firms (Gebauer, Paiola and Edvardsson,
2010):
Small scale: This concept defines those firms which are larger than micro and has approx
50 members employed which help executive to generate 5 million dollars from business.
Micro scale: This sector includes organisation which are set up by individuals to generate
adequate income to maintain their living standards and get financially secured. Firm has very
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less number of staff as management have limited capital and resources (Commander and Svejnar,
2011).
Medium scale: This tactic comprise companies which comprises around 200 employees
which benefit senior to gain 5 to 23 million dollars.
Large scale: This sector has companies 250 to 500 members which help management to
mange and regulate branches in different nations. ASDA has large number of stores established
in number of cities which benefit executive to have large number of customers. This helps
seniors to enhance market reach; thereby increase sales and profitability (Cronan and et. al.,
2011).
Objectives differentiation:
Micro Small Medium Large
This kind of firms
prime focus is to
execute business
operations to gain
adequate money to get
financially secured and
maintain livelihood
and standards.
This form of business
are operated by
individuals with goal
of delivering items and
services in according
to demands of people.
Main goal of this
sector organisation is
to increase market
reach and customer
base by opening
outlets in same city
and in other countries.
This kind of firms
prime motive is to
provide variety of
items and services to
establish competitive
advantage in respect to
competitors and bring
sustainability in
economy.
Scope of Different types of Organisations:
Micro Scale: Business activities executed by firm of this level is limited in nature which
is due to amount of capital executive have to purchase material in respect to market conditions
and objectives determined by seniors. Management has opportunity to increase market reach by
opening branches in same city and expanding in different nations (Halbert and Ingulli, 2011).
Small Scale: This kind of firms which has scope to increase operations and implement
appropriate tools and techniques in system to transform and enlarge business to medium scale.
Medium Scale: This sector require that management should increase funds and expand
business by increasing branches in same city and in different nations. This help administration to
increase market reach and customer base which benefit firm to enhance sales and revenue.
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Large Scale: These are firms which have outlets in number of countries, this help
executive to have large number of people. But, management even need to sustain and mange
system to establish competitive advantage in respect to rival firms.
Transnational Company: This tactic includes organisation which have outlets in more
than one country. Executive have appropriate resources that is funds, material and manpower to
establish stores in different nations to have large number of customers. Multinational firms such
as ASDA is transactional enterprise which has big market reach which help management to
enhnace sales and profitability (López-Gamero, Molina-Azorín and Claver-Cortés, 2011).
TASK 2
P3 Relationship among various organisational functions and link with objectives
Administration formulate policies and strategies to make system function
legally by making tactics in according to rules and regulations of government.
Along this, flat organisation structure is used by ASDA which help top personnels
to manage staff and provide them appropriate direction and guidance in respect to
duties and tasks assigned by seniors. This benefit company to deliver variety of
items in store in according to taste and preference of people. Hence, executive is
able to accomplish goals and objectives; thereby improve market position and image
(AgarwalGrassl and Pahl, 2012).
Finance, Human resource, marketing, operation, sales, IT, research and
development are different department which are present in every organisation. It is
essential that management design system and implement appropriate tools and
techniques to deliver adequate things and services in market. Therefore,
organisation functions has interrelation with each other which stated below:
Human Resource Department: Entrepreneur require to have proper
manpower in firm to implement activities of business effectively. It is essential that
employees are given activities and tasks in according to their skills and abilities.
Compensation, selection, Recruitment, training and development are practices
executed through HR of ASDA to coordinate and manage team members. Human
resource duty is to take care that each unit have skilled and competent people which
help in accomplishment of goals and objectives.
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Production and Operations: This department require to manufacture items
and deliver appropriate services to customers in according to their needs and wants.
ASDA which is supermarket has variety of things in store which help management
to attract individuals through giving them products in context to want and demands
of individuals. This is subsidiary of Walmart; so it is necessary that quality items
are delivered in outlet to satisfy people ( Aterido, Hallward-Driemeier and Pagés, 2011).
Marketing Department: This segment responsibility is to frame appropriate
plan which comprises information about product, price, place, promotion, people,
process and physical evidence. Market department helps other segments of ASDA to
function effectively by informing people about variety of items that are present in
store. Along this, finance unit provide budget that can be investing in promoting
things to grab attention of customers.
Finance department: Management of ASDA require to utilise capital and
design system which help organisation deliver services and products on the basis of
wants and demands of individuals. Every unit need to have adequate funds which
help seniors to conduct business activities effectively. Financial statement that is
profit and loss, balance sheet and cash flow is maintained by seniors to have
accurate and complete knowledge about profitability and expenses ( Auzair, 2011).
Research and development: Market survey and research are tools used
through R&D of ASDA to acknowledge requirements and preferences of
individuals. It aids management to manufacture products and provide them in
according to preferences of customers. Along this, finance unit provide funds and
support to conduct operations effectively.
TASK 3
P4 Positive and negative affect of Macro environment on Business operations
Organisation needs to make system function on the basis of market conditions. It is
necessary that macro environment is evaluated by management to anticipate positive and
negative impacts on business activities. PESTEL analysis is technique use by management of
ASDA to anticipate influence of external components on business activities. This help seniors to
design system and frame policies in according to rules and regulations of government. Hence,
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administration is able to establish competitive advantage to attract customers by position firm
higher than rival firms.
PESTEL analysis of ASDA is described below:
 Political factor- UK Government had formulated laws and legislations to regulate and
mange business activities. Human resource responsibility is to frame policies and design
system to make it function legally. ASDA has outlets established in different nations, so
management make changes and transformations in system to deliver things in respect to
market conditions (Avramenko, 2012).
Positive effects: Free trade policies are made by authorities of UK which encourage ASDA to
transfer items from one nation to another. Along this, Brexit also benefits firm to execute
business activities effectively.
Negative effects: Every country has different policies which makes administration work
complex as they require to regulate business and make tactics to establish appropriate position in
market.
 Economical factor- Interest rate, exchange rate and inflation are various elements which
depend upon state of economy. Government fix these to attract and restrict firms from
setting their outlet in nation.
Positive effects: In United Kingdom, there is an inflation which stated that people have
appropriate money to buy products on the basis of their wants. It aids ASDA to have strong
consumer base which advantage executive to increases profit and productivity. (Adeoye and
Elegunde, 2012).
Negative effects: Brexit influence on fluctuations in currency which define that in ASDA,
management faces problems in export of items from one nation to another.
 Social Factor- This tactic define that organisation provide items and services in market
in according to fulfil needs and wants of people. ASDA is retail store which has variety
of food items, clothes and various other things in according to taste and preference of
public.
Positive effects: ASDA launch new items to provide products in respect to market trends. It
helps management to attract consumers and make them buy things in according to their wants.
Negative effects: Administration of ASDA require to make changes in system and keep
changing products in according to demands of people.
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 Technological Factor- This component define that executive need to execute proper
tools and also techniques in system to provide products on the basis of needs and wants
of people.
Positive effects: Superfast broadband and mobile apps are used by seniors of ASDA to conduct
activities effectively. Along this, internet helps provide quick services to customers to enhance
market position and image in respect to rival firms (Bar-Isaac and Shapiro, 2013).
Negative effects: Management require to conduct training and development activities to enhance
skills and abilities of members; thereby make them competent to perform tasks with technologies
that are implemented in system.
 Environmental Factor- This element define that organisation require to utilise natural
resources. ASDA is retail store which provide quality items and take care of pollution
and hazardous waste.
Positive effects: ASDA makes system function environmental friendly and position firm
superior than competitors.
Negative effects: Management require to take care that resources are utilised efficiently. Along
this, they even require to monitor items are note harmful and dangerous for people.
 Legal Factor- Equality, discrimination and minimum wage act are developed through
government to safeguard and also protect rights of people.
Positive effects: ASDA have competent and skilled people individuals help executive to provide
better quality items and quick services to individuals (Burnsand Winter, 2011).
Negative effects: Company require to have adequate manpower to deliver things superior than
competitors.
TASK 4
P5 Internal and External analysis of ASDA
Administration require to have complete information about market conditions and system
abilities. ASDA is supermarket established in UK and other nations, so it is essential that
management design system and make it function according to wants and demands of persons.
SWOT analysis refers to technique that used through top management to know strengths and
limitations of firm; thereby utilise market opportunities and protect system from threats. This
tactic helps ASDA to position higher than competitors.
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SWOT analysis of ASDA:
Strengths Weaknesses
 ASDA is subsidiary of Walmart which
is famous retail store.
 Management has variety of food,
clothes and home products in outlet to
attract customers by giving them items
in according to their taste and
preference.
 ASDA design system and use latest
technologies which help in reducing
cost and provide items at appropriate
rates.
 UK has limited number of small
supermarket which impacts on
performance of ASDA.
 This is world's largest grocery store
which specifies that management
require to make system function and
use appropriate information
technologies in system to control and
manage operations effectively (Boons
and Lüdeke-Freund,2013).
Opportunities Threats
ASDA executive can merge and take strategic
alliance with other retail stores to enhance
market reach and customer base.
Morrisons, ALDI, LIDL and Waitrose are rival
firms of ASDA. Management require to
provide variety of items and quality things in
store to establish competitive advantage than
rival firms.
P6 Interrelation of Strength and weakness with external Macro factors
ASDA is retail store which has outlets established in number of countries.
Grocery, food items, clothes and various other products are provided by company to
have large customer base. This help executive to increase market reach which
benefit in enhancing sales and revenue ( Chow and et. al., 2011).
PESTEL analysis is tool which helps management of ASDA to have finish information
related to external factors and also their affect on activities of business. Along this, SWOT
analysis is another technique used through executive to acknowledge market conditions and
system capabilities. ASDA which is subsidiary firm of Walmart require to utilise funds and
resources to make system function in according to competitors.
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Management of ASDA frame policies and strategies in respect to government policies in
respect to taxation, trade barriers and exchange rate. Government has frame free export policies
which encourage ASDA to transfer items from one nation to another. Executive give tasks and
duties to members in respect to their abilities and skills which help them to have skilled and
competent staff. Along this, latest technologies are executed in system which benefit seniors to
provide quality items and services in store. ASDA has powerful logistics system which help
management to deliver things and enhance market reach and customer base. This helps executive
to generate appropriate profit from business and improve sales (Mahmood and Hanafi, 2013).
CONCLUSION
From the above report it has been concluded that the business environment has internal
and external factors which directly or indirectly impacts on business activities. Public, Private
and also voluntary are different types and purposes of firm that differ with the each other in
context to scope, size, objective and structure. Human resource, finance, production, research
and development are various department which have interrelation and require to function
effectively. PESTEL and SWOT analysis are technique used by management to anticipate
positive and negative impacts of macro environment. Along this, strengths and weaknesses of
system is also ascertained by seniors to acknowledge its interrelation with external macro factors.
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