Business and Business Environment Report: ASDA, Tesco, NCVO Analysis

This report provides a comprehensive analysis of the business environment, focusing on three distinct organizational types: ASDA (private), Tesco (public), and NCVO (voluntary). It examines their purposes, legal structures, size, and scope, highlighting the differences between small, medium, and large organizations. The report delves into the interrelationships between organizational functions like HR, finance, marketing, and sales, and how they link to business objectives and structures. Furthermore, it explores the impact of the macro environment using PESTLE analysis and conducts SWOT analyses to identify strengths, weaknesses, opportunities, and threats. The report critically evaluates how macro and micro factors influence business objectives and decision-making, providing valuable insights into the complexities of business operations and strategic planning.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
P1. Examine the different types of organisation, their purpose and legal structure....................1
P2.Examine the size and scope of a range of different types of organisations...........................4
Comparison between small, medium and large organisations.........................................................4
M1.Examine how the structure, size and scope of different organisations link to the business
objectives and product and services offered by the organisation................................................5
P3. Examine the relationship between different organisational functions and there link to
organisational objective and structure.........................................................................................5
M2. Analyse the advantages and disadvantages of interrelationships between organisational
functions and the impact that can have upon organisational structures......................................7
D1.Provide a critical analysis of the complexities of different types of business structures and
the interrelationships of the different organisational functions...................................................7
P4. Examine the positive and negative impact of the macro environment has upon business
operations of ASDA....................................................................................................................8
M3. Analyse PESTLE model to support a detailed analysis of the macro environment within
an organisation............................................................................................................................9
P5. Conduct the internal and external analysis of ASDA in order to identify strengths and
weaknesses................................................................................................................................10
P6. Examine the strengths and weaknesses of ASDA and interrelate with external macro
environment...............................................................................................................................11
M4. Apply SWOT and justify how they influence decision making........................................12
D2.Critically evaluate the impacts that both macro and micro factors have upon business
objectives and decision making................................................................................................12
CONCLUSION..............................................................................................................................13
References:.....................................................................................................................................14

INTRODUCTION
An organisation is occupied by many people's to carry commercial activities in order to
attain profit and growth is a business and business environment consist of group of employees,
entities and internal and external factors of environment which determines the productivity,
profitability, growth and performance of the business (Szromek, 2020). The report covers the
three types of organisation: ASDA, a private organisation owned by single individual is a
supermarket chain located at Leeds, London. Tesco , a public organisation funded by the
government is a a multinational groceries and general merchandise retailer located at Wletwyn
Garden City, England. The last is voluntary organisation named as NCVO( National Council of
voluntary organisation. Apart from this report outlines the organisation and legal structure of
above organisations. Size and scope of private, public and voluntary organisation are also
discussed. PESTLE and SWOT analysis of organisation are conducted to analyse the strengths
and weaknesses. The inter relation of strength and weakness with external macro environmental
factors are outlined in the report.
MAIN BODY
P1. Examine the different types of organisation, their purpose and legal structure
Organisations are the commercial entities categorized in three sectors:
PRIVATE SECTOR
Private organisations are the companies owned by the individuals for the profit earning
and are not managed and controlled by the state (Li, 2020). Private sector inclined to have larger
market share of the economy. ASDA Stores Ltd. is one company among the private sector of
UK. ASDA is a second largest retail supermarket chain founded in 1949. The company was
earlier acquired by the Walmart but now in 2021 acquired by the EG group by Issa brothers.
Purpose of Private Sector
The main purpose of Private sector to earn profit with income and maximize the economy
and provide more employment that public sector. Private sector aims at increasing sales, growing
business and earning larger income. For example ASDA is a private company with the aim to
become largest supermarket chain of UK. The sole purpose of ASDA is to drive highest profit
and growth for future with its retail counter all over the world and UK.

Legal Structure Sole proprietorship:Sole proprietorship is type of private sector company owned by the
sole person who pays all the taxes and owns the profit personally. This is the easiest and
simple type as there are no government regulations (Özkaya, 2020). Partnership: Partnership is a arrangement of business between two or more groups or
individuals to operate the business and profits and liabilities are also divided between
them. This structure require the legal contract to agree the partnership.
 Corporation: The type of private organisation that guard owner assets and address
liabilities, in core, creating Unique entity without drawing any tie-up with individuals.
These companies are has different tax laws.
ASDA comes under the partnership type of private organisation as the firm is acquired
recently in 2021 by the two brothers of EG group to expand and establish its stores with the
petrol filling stations. The firm is now operated under the partnership of Zuber and Mohsin Issa.
All the decisions, profits and liabilities are together taken by the two partners.
PUBLIC SECTOR
Public sector of the economy are owned by the government for the community. Public
sector are the not profit driven else there made to serve the people in community and is for the
benefit of the public. Public sector employs have the job security and life time pension (Yoon,
2020). The rules and regulations in this sector are regulated by the government. Tesco is the
public limited organisation in the retail industry of groceries and other merchandise. It is largest
retailer of grocery in UK.
Purpose of Public sector
The sole purpose of the public sector is to serve the community or society with the
products and service at cheaper cost without any aim of profit. The public sector aim to collect
taxes from people and use this finance to serve local communities. Tesco a public limited
company with the purpose to save the money of people by selling there product and services
cheaper from other retail stores.
Legal structure Local Governance: Local governance is the authority of the local government to regulate
and control the public sector organisation with local laws and there benefit to local

community(Vučković, and et. al., 2020). The role of local governance in the public sector
organisation is to ensure the public sectors functions and operations are ethical and
beneficial to local people's health and well being. State Governance: State governance is undertaken by the government of the state in
which public sector runs the organisation (Dvorsky, and et. al., 2020). The role of state
governance is to make sure the public sector organisation are beneficial for the economy
of state and employing the state people's.
 Central Governance: Central governance is top level governance which is regulated by
the central government as per nations rules and regulation. Central governance or
corporate governance has purpose to develop strong economy and ensure transparency.
Tesco as public limited company has corporate governance legal structure which helps in long
term sustainable business. Corporate governance helps the public sector in attracting and
maintaining the stakeholders and shareholders for the firm.
VOLUNTARY SECTOR
Voluntary sector is the social enterprise run and owned by the voluntary people's for the
social causes and non profit organisations. The Voluntary organisations are operated at large
scale to benefit the society selflessly with there work. NCVO (National Council for Voluntary
Organisation) is UK's voluntary sector organisation in England with approx 14000 voluntary
members.
Purpose of Voluntary Sector
Voluntary sector are with the primary purpose to help needful people in society rather
than earning profit (Oba, and Postole, 2021). NCVO is the Voluntary organisation with aim to
make difference in society wit there vision and believe that they are essential for the societies
well being. NCVO work under three principles connecting, representing and supporting the
organisation with the voluntary government.
Legal Structure Trust: Trusts are for managing the money or property donated by the donor to the
trustees of the trust who become the nominal owners of that donation and so that people
in society can be benefited by the trust at time of need. Trust are non- democratic
organisation.

 Charitable organisation:Charitable organisation is a unincorporated association set up
with sole principle is to benefit the people among the society to provide them with
happiness and support for the living through counselling and charity (Dvorský, and et. al.,
2020). These are the non profitable organisation and highly favoured by the government
for goodwill. For example NCVO is one of the charitable trust with values in culture to
be collaborative, transparent, inclusive and ambitious.
P2.Examine the size and scope of a range of different types of organisations
Basis ASDA Tesco NCVO
Size ASDA has approx
145000 dedicated
employees with approx
650 stores. ASDA has
approx 18 million
customers on weekly
basis shopping in the
stores.
Tesco has diversify
workforce of approx
320000 and 3700 stores in
UK. Tesco serves
millions customers every
week in physical and
online stores. Tesco is
world's largest retailer in
size.
NCVO is the regulated by
the board of 12 trustee and
50 members assembly.
NCVO reflects approx
16,000 voluntary
organisations, social service
companies, charities,
community groups in
England. NCVO operates at
the national level.
Scope ASDA is offering
grocery, general
merchandise, financial
services and now mobile
phone with low price
strategy has a scope to
become lowest prices
supermarket.
Tesco scope is to expand
the market with product
and service it offers.
Tesco is largest retailer in
UK and now is planning
to expand in US.
NCVO is large social
organisation and has scope
of growth in income with
inflation and also make
difference with there well
being.

Comparison between small, medium and large organisations
Basis Small Medium large
Meaning A organisation with 0-
50 employees, less
capital, less resources
and works on small
scale with one owner.
A organisation with 0-
250 employees, short
term cash flow by
venture capitalists with
limited customer base
(Băeşu, and Bejinaru,
2020).
A organisation with
1000 employees,
larger customer base,
full of capital and
machineries.
Objectives Profit maximization,
excellent customer
service and sustainable
growth with core
values are the
objectives of small
organisation.
Innovation, profit and
attracting large
enterprise for
collaboration and
capital are the
objectives of medium
organisation.
Development and
diversification with
innovation and earning
profit, growth
reputation , stability is
the objective of large
organisation.
Decision-making Decision making is
done by the owner.
Decisions are taken by
the CEO, owner or
specific members.
Decision making is
hierarchy process by
the board of directors
of large company.
M1.Examine how the structure, size and scope of different organisations link to the business
objectives and product and services offered by the organisation
Size, scope and structure of the organisation are used and linked with the goals and aims
of the organisation. no. of employees, stores and customers decides the structure of the
organisation and their objectives to be achieved. On the basis of the scope it is evaluated that the
organisation under voluntary sector have scope to serve society without profit, where as
organisation with scope to earn profit on large scale with government rule comes under public

sector and private sector scope is to gain profitability and growth. Hence, scope of the
companies decides the objective and products and service to be served by the companies and size
and structure helps in achieving them (Kanyeria, and Karugu, 2020).
P3. Examine the relationship between different organisational functions and there link to
organisational objective and structure
Every organisation is combination of various functions and departments and these
organisational functions and there work are interrelated to each other. In context of ASDA the
role and interrelation of various organisational functions are discussed below:
HR and Finance Department:Human resource department functions involves all the activities
related employees hiring, recruiting, firing, training and acknowledging employees benefits.
Whereas Finance department role is to manage all the capital and funds of the organisation and
create budget for expenses and profits. In ASDA Finance department leverage on HR department
for the adequate supply of required taskforce. Moreover in HR planning for training and
recruiting employees HR manger of ASDA need some capital which is approved by finance
department.
Marketing and Sales Department:Marketing department role is to promote the product and
services, reach customers and investors with prominent message to outshine company's image.
Moreover Sales department is to convert the leads in sales by selling products to customers to
earn revenue(Eddleston, Banalieva, and Verbeke, 2020). In ASDA the marketing people collect
the data of customers and market to provide sales department with quality leads for there
supermarket stores. Whereas the sales department provide the information to marketing
department regarding planning of marketing strategy for the market expansion according to the
interest and feedback of customers.
Organisation structure
Organisation structure are the system or pattern a organisation follow for proper
utilization of resources and to organise the workforce with required skills and talent, so that
organisation operates smoothly to achieve the goals and objectives. The various organisation
structure are:

 Divisional: This structure is about segmenting the organisation functions into sub
divisions to offer the flexibility to large companies like Tesco to operate its various
division like supermarket, hypermarket, etc. to operate as its own another company. Functional:In this organisation are divided in small functional groups in regard of
specific task and roles. For ex. IT, finance, HR etc. ASDA follows the functional
structure to operate its supermarket operations and each department has its own manager
to manage the large number of employees smoothly.
 Matrix:A complex and blended combination of functional and divisional structure where
employees need to report to more than one boss (Opeyemi, and Ajeh, 2020). NCVO a
voluntary organisation follow such structure as they have different trustee and random
members so role and responsibilities are divided in different trustees and decision making
is of all.
M2. Analyse the advantages and disadvantages of interrelationships between organisational
functions and the impact that can have upon organisational structures
Interrelationship between the HR and Finance department and Marketing and Sales
Department possess some advantages and disadvantages that effect the organisational structure
are mentioned below:
Advantages
 Interrelationships between the organisation functions build the cooperation and
understanding between the different departments and their members this helps ASDA
like organisation to work more effectively.
 Operational speed is increased in the organisation as interrelationship helps in quick
solution and decision making (Kristinae, and et. al., 2020). Profitability and effectiveness of the organisation are enhanced as employees of different
functional areas share the information that develop each others knowledge and skills.
Disadvantages:
 Unhealthy competition is created between the organisational functions thereby creating
clashes which results in rift in organisation structure of the organisation like ASDA.

 Information of each other department are leaked by the breaches which creates the rift in
departments also members and mangers deny to work for each other for which
organisation structure is seen to ineffective for the organisation like ASDA.
D1.Provide a critical analysis of the complexities of different types of business structures and the
interrelationships of the different organisational functions
It is criticality evaluated from the above information that the organisational structures are
the pattern through which the different types of organisations are formed. Moreover different
structures are designed by considering different functions performed by organisation. But the
role and responsibilities of this functions are different and there interrelations helps the
organisation structure to work significantly (Hudelcu, 2020). It is analysed that the small
business have simple structure and with limited functions , size and scope where are large and
medium business have complex structure with large size and scope. Therefore the types of
business are different as per there objectives and scope for future. For example ASDA is private
company, Tesco is public company and NCVO is voluntary company with their respective
complex structure: functional, divisional and matrix. Hence, organisations have different
organisational functions like, IT, finance, HR, operations, sales etc. and there complexities drive
organisational structures and there interrelationship(Terziev, Lyubcheva, and Denis, 2020).
P4. Examine the positive and negative impact of the macro environment has upon business
operations of ASDA
ASDA is the second largest retailer of groceries and other entities in UK. ASDA Stores
Ltd. is the supermarket chain of British situated in Leeds,England. For the strategic planning and
to analyse the effects of macro environment on the business of ASDA , PESTLE analysis is very
important framework to analyse the factors associated with the operations of ASDA. The
following factors of PESTLE analysis are: Political: ASDA has different approach towards the political factors as political stability
in UK sounded beneficial to the company. However, the impact of Brexit was uncertain
to the ASDA business. But post Brexit has build the hope for the supply of materials in
EU and UK. Political pressure, taxes, new legislations is impacting the prices of the

ASDA. Therefore, ASDA constantly monitor the political environment of UK and other
countries it operate in. Economic: Economic factors impact the pricing strategies of the ASDA, like due to
COVID-19 economy of UK declined and so the jobs of people in 2020 which reduced the
shopping activity and reduced the spent amount of customers. Rate of inflation of UK has
positive impact on company. The pressure on government to restrict the large companies
like ASDA for competition approach of small business is risking the long run operations
of ASDA dee to which prices are at downfall. Social: Healthy lifestyle trend , ageing population and social changes have serious impact
on the sales of ASDA. Social factors like demand of organic, vegan and vegetarian food
is capturing market rapidly which helps the ASDA to diversify and penetrate new market
and customer base. Young population is increasing the customer base of ASDA with
there habit of spending. Technological: Technology adapters are gaining the competition in the market as
COVID-19 has made the world digital. ASDA is well organised in this factor as company
uses latest technology in stores to distribute thereby reducing waiting time for customers.
Daily changes in technology has increased the expense of ASDA in technology and
digitalization. ASDA as the largest supermarket daily practice new technology to
implement in stores for ease and simplicity. Legal:Legal laws and regulations abide the business of ASDA and other forms of UK.
Legal factors play the crucial role in operations of business like penetration, segmentation
and establishment. ASDA is the private company and comply all the UK government
rules and regulation for the trading onside and outside the UK. Company has laws to
protect the employees benefits and rights.
 Environmental:ASDA always ensure that there protect doesn't have negative impact on
environment for which company uses renewable and reusable resources for the product
packing and materials used in stores for environment friendly approach. For ASDA
organic food, green economy, carbon footprint, harmful waste are the matter of concern
as customers are more concerned for the environment.

Hence, PESTEL analysis of ASDA is helpful for company to examine its competitors strategy
like Tesco through which ASDA has become a supermarket with low price strategy. Moreover
PESTLE analysis is benefiting the ASDA to overcome the impact of EU and UK separation and
the coronavirus impact on customers trends.
M3. Analyse PESTLE model to support a detailed analysis of the macro environment within an
organisation
By applying the PESTLE model in ASDA, a second largest supermarket chain of UK it is
critically analysed that the factors of macro environment of organisation are moderate in
providing benefits to the organisation. Political factor like political stability in UK have benefited
the ASDA organisation in its operations. Economic factors like High inflation rate of UK is
favourable for ASDA to invest in new products. Social factor like customer online shopping
trend increases ASDA online customer base. Technological factor like e- shopping, new
technology for distribution has benefited the ASDA to attract customers as waiting time is
reduced for busy scheduled customers. Legal factors like corporate governance code of conduct
in business of ASDA leverage the business with government support in trading. Environmental
factor where customers concerns for environment has increased helped the ASDA to develop
new new products like organic and vegan food. Hence, implementation of PESTLE is boost the
business of ASDA.
P5. Conduct the internal and external analysis of ASDA in order to identify strengths and
weaknesses
SWOT analysis is the tool for internal and external analysis that identifies the strengths,
weaknesses, opportunities and threats to organisation due to which companies longevity and
service can be hindered (Gao, and Li, 2020). ASDA is a retail grocery supermarket chain
recently acquired by the EG group is facing several changes in market as well as in customers
choices and decision for which SWOT analysis is conducted:
Strengths Weaknesses
 ASDA has a reputed and strong product
portfolio with wide range of products to
serve the customers such as: groceries,
 ASDA presence in other countries other
than UK is very minute which restrict
the companies penetration and