Business Functions, Organizational Culture, and Finance at Body Shop

This report provides a comprehensive analysis of The Body Shop, a leading international cosmetics company. It examines the roles of Human Resources (HR), marketing, and finance within the organization, detailing how each function contributes to the company's success. The report further explores The Body Shop's organizational culture, including factors that contribute to a collaborative working environment and an analysis based on Charles Handy's model. Different management and leadership styles are discussed, with examples of how they are applied within the company. Finally, the report reviews and explains the importance of key financial statements such as the profit and loss account, balance sheet, and cash flow statement, using data from The Body Shop to illustrate these concepts. The analysis aims to provide a holistic understanding of the business functions and financial health of The Body Shop.

Report

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Task 1.....................................................................................................................................1
Role of HR within the Body shop.................................................................................1
Role of Marketing within the Body Shop.....................................................................2
Role of Finance within the Body Shop.........................................................................2
Task 2.....................................................................................................................................3
Organisational culture in the Body Shop......................................................................3
Management / Leadership style in the Body shop........................................................4
Task 3.....................................................................................................................................5
Profit and Loss Account................................................................................................5
Balance Sheet................................................................................................................5
Cash flow Statement.....................................................................................................6
CONCLUSION................................................................................................................................7
References:.......................................................................................................................................9

INTRODUCTION
Business studies can be defined as the field of study in management which teaches about
the entrepreneurship and business functions to operate in the real time organizations which
includes various specializations such as marketing, finance, human resource and many more.
Here the organization chosen is The Body Shop, it is one of the leading international cosmetics
company based in UK in 1976. It offers the products such as soaps, face wash, body wash,
cream, lotion and many more. The following discussion is based on the role of HR, marketing
and finance, organizational culture, management or leadership style, profit and loss account,
balance sheet and cash flow statement with proper findings and conclusion in context of The
Body Shop.
MAIN BODY
Task 1
Role of HR within the Body shop
Definition
Human resource management can be defined as the people management in an
organization where staff are managed as per their job profile and working environment in the
company. Employees are considered as the greatest asset in the firm and that is why taking care
of them it an important function in an organization (Stewart and Brown, 2019).
Explanation
Human resource management itself contains various domains and areas in which
employees are managed such as recruitment, hiring, selection, on boarding, payroll, training and
development, compensation, recognition, performance management and termination domains.
This is done in order to satisfy the staff in terms of the job and social life as well (Opstad, 2018).
In context of The Body Shop
The Body Shop Company has adopted the human resource management function in a
strategic manner so that employee turnover can be reduced and retention can be increased. They
encourage employees not only in developing professionally but personally as well in order to
achieve the targets, goals and objectives as per the expectations and planned by the leaders and
managers. For example, at the time of new launching of the product, company has organised an
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event in which the presentation program has conducted in which every employee associated with
the program are asked to give the presentation and this not only had advertised the firm’s
products but also the personal communication skills in the employees.
Role of Marketing within the Body Shop
Definition
Marketing management can be defined as the promotional and advertising activities in an
organization in order to create awareness about the company, products and services in the market
place. Customers attracts towards the products if the marketing activities are attention gaining
and it is basically the buying and selling activities in the firm (Deepak and Jeyakumar, 2019).
Explanation
Marketing management itself contains various domains to perform such as sales activity,
planning activity, data management activity and many more. There are various methods to
market the products and services such as television, newspapers, magazines, radio, social media
marketing, search engine optimization, google ads and many more (Colli and Perez, 2020).
In context of The Body Shop
The Body Shop Company has adopted the marketing management function in a strategic
manner such as they focus on the target markets and value proposition methodology. They
mainly promote the products through the internet via digital or online marketing process because
now a days people are more on the internet rather than the traditional market place (Chernev,
2018).
Role of Finance within the Body Shop
Definition
Finance management can be defined as the budget management and auditing of the
financial statements so that better interpretation and analysis can be done for the future
considerations in terms of profit, losses, revenues, expenses and many more to examine that what
measures must be taken by the company to enhance such budgeting.
Explanation
Finance management itself contains various domains to operate in an organization such
as auditing process, budgeting process, documentation process, data analysis and many more as
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per the requirements of the company. It is necessary because it helps the company in gaining
more in the future if better determination is done on the finances of the firm (Krueger, Bogers,
Labaki and Basco, 2021).
In context of The Body Shop
The Body Shop Company has adopted the finance management in a strategic manner
such as they maintain all the important documents in the firm to better analyse the cost and
income in order to reduce the cost and increase the efficiency in production with more sales and
revenue generations as it helps in decision making process. For the full year, combined net
revenue raised 7.8% on a reported basis and 7% at constant currency to R$14.4 billion that is
£2.3 billion. Adjusted EBITDA for the year was up 7.5% to $R2 billion that is £330.26 million
while underlying operating income improved 5.7% year-on-year.
Task 2
Organisational culture in the Body Shop
Definition of culture
Culture can be defined as the environment of the organization in terms of behaviour of
the people, standard of the leaders, skills of the managers, maintenance of operations and
structure of the firm. How such things are managed and operated within an organization is
basically known as the culture of the company as it defines the friendly and working
environment towards goals and objectives of the company (Driskill, 2019).
Contribution towards a collaborative working environment
Culture has a great contribution towards the cooperation and collaborative functions in an
organization because each and every function or department of the company are different to each
but yet they are interdependent on each other to perform their individual functions. Hence,
working culture of the firm assist such function to work in a collaborative manner (Level, 2018).
Factors which make up the culture within an organisation
There are many factors which develops the culture in an organization such as size is one
of the factor of culture which means that size of an organization decides the number of people
who will work together or not. Location can be another factor of culture because it decides that
what behaviour or things it is required to be adopted in the company. Beliefs is also an another
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factor of culture which states the individual beliefs of the employee and employers of the firm
followed by their overall stakeholders.
Charles Handy's concept of organisational culture
This model consist four elements in context of organizational culture such as first is
power delegated to leaders and employees are important that must not be negative but positive.
Role is second element that everyone in the firm must be satisfied with the role and their job
duties and responsibilities. Task is third element because culture definition is dependent on the
task rendered to each employee to accomplish. People is fourth element in culture theory because
employee form the whole culture in an organization either in the positive or negative manner.
Management / Leadership style in the Body shop
Autocratic style
This style is defined as the leader is autocratic in nature which means they do not allow
their team mates to make the decision for anything, they just provide resources to accomplish the
task and assign each and every member to fulfil their responsibilities.
Democratic style
This style is defined as the leader is democratic in nature which means they allow their
teammates to make the decision but monitors that the decision is right or wrong and then allow
to proceed further (Bazeley, 2018).
Laissez faire style
This style is defined as the leader is free rein in nature which means they permit all the
rights of decision making to their team mates and continue the task accordingly and don't
interfere in their work.
The impoverished manager
The style of manager can be defined as the manager who accomplish his or her task in a
sufficient manner but it lacks need commitment and Retreat from realities of work and people.
The authoritative manager
This style of manager can be defined as the manager who is responsible to get the job
done well at all the cost in and direct manner while controlling the people who do what they are
told which helps in acknowledge the results in a better manner.
The social manager
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The style of manager can be defined as a manager who believes in the contended staff
will do well and accomplish the results which are reasonable and valid to to present. They avoid
conflict and really criticize among the people. Harmony is an essential area among the people
instead of the quality of the work.
The middle of the road manger
The style of manager can be defined as the manager who aims to compromise with some or the
other part of a work but not too much loss in the quality of work. They have the nature to avoid
the real issues and resolve it the conflicts in a potential manner (Cohen, 2019).
Contribution of Management/leadership style in the Body shop
The Body Shop Company has adopted all the three styles of leadership and management
as per the demands of the situation, it cannot be possible for the firm to be consistent in the style
but it is important to change the style from time to time and from situation to situation. This
helped the firm in performing its functions in a smooth manner with effective people as well as
operations management.
Task 3
Profit and Loss Account
Explanation
It is defined as the income statements of a company which shows revenues and expenses
for a particular time period. It indicates that how the revenues are converted into the net profit or
net income.
Importance of document
It helps the company to analyse the net income of the business which can be helpful in a
process of decision making (Edelson, Senk and Stock, 2018).
Balance Sheet
Explanation
It is defined as the summary of the finances of an organization which contains the amount
of asset and liabilities of the firm which must be matched to know the proper financial conditions
of the firm.
Importance of document
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It is basically important for the investors so that they can figure out that how much they
should invest in the company by reading the balance sheet of the firm (Lund-Thomsen, Hansen
and Lindgreen, 2019).
Cash flow Statement
Explanation
It is defined as the financial statement of the firm which shows that how the changes in
balance sheets affects the cash flows in the company as it also affects the operating, investing
and financing activities of the firm.
The Body Shop International Cash Flow
Annual
GBP FY, 2011 FY, 2015 FY, 2016 FY, 2017 FY, 2018
Net Income 14.0m 17.0m
Depreciation
and
Amortization
36.0m 37.0m
Accounts
Receivable
(7.0m) (1.0m)
Inventories 6.0m 5.0m
Accounts
Payable
(8.0m) 8.0m
Cash From
Operating
Activities
28.3m 53.0m 34.0m 69.0m 71.0m
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GBP FY, 2011 FY, 2015 FY, 2016 FY, 2017 FY, 2018
Purchases of
PP&E
(41.0m) (36.0m)
Cash From
Investing
Activities
7.6m (75.0m) (46.0m) (36.0m) (26.0m)
Short-term
Borrowings
(62.0m)
Long-term
Borrowings
(1.0m)
Cash From
Financing
Activities
(22.4m) 3.0m (19.0m) (32.0m)
Net Change
in Cash
13.5m (19.0m) (21.0m) (2.0m) 45.0m
Importance of document
It again helps the investors to make the investments decision and can interpret the future
cash flows of the firm (Doern, Williams and Vorley, 2019).
CONCLUSION
It is concluded that business studies is an important concept to learn about the
management to practice its conceptions in the real world organizations. Therefore, it is important
to analyse the role of HR, marketing and finance functions, it is essential to examine the
organizational culture, it is necessary to determine the management or leadership style and it is
significant to gain the knowledge about the profit and loss account, balance sheet and cash flow
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statement. Hence, this report covers all such areas in order to better understand the
conceptualization of the business studies (Daft, 2021).
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References:
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Driskill, G.W., 2019. Organizational culture in action: A cultural analysis workbook. Routledge.
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the place of “introduction to management” in an integrated curriculum. Journal of
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Stewart, G.L. and Brown, K.G., 2019. Human resource management. John Wiley & Sons.
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