Report on Business and Business Environment of Burberry Group PLC

This report provides a comprehensive analysis of the business and business environment of Burberry Group PLC. It begins with an overview of the types and purposes of public, private, and voluntary organizations, including the legal structure of Burberry as a public limited company. The report examines the size and scope of various organizational types, using Virgin Group as a comparative example. It then delves into the relationship between organizational functions and objectives, highlighting how Burberry's structure supports its goals. A key focus is the impact of the macro environment on Burberry's operations, with PESTLE analysis to identify external factors. Furthermore, the report conducts an internal and external analysis using SWOT to identify strengths and weaknesses and their interrelation with external factors. The report concludes with a discussion on the strategies needed for businesses to cope with an uncertain and turbulent environment, particularly after the UK's decision to leave the European Union.

BUSINESS AND BUSINESS
ENVIRONMENT

EXECUTIVE SUMMARY
Present report explained the macro and micro environmental factors that affect decision
making and organizational structure of organizations. PESTLE and SWOT analysis are
conducted to identify these factors of Burberry Group PLC, UK which highlighted positive and
negative impacts. The research also investigated Burberry’s internal and external environment
which clarified strengths and weaknesses of London based fashion house. Further, this report has
discussed the organizational objectives, legal structures, mission, vision, business objectives and
information about stakeholders of Burberry Group PLC.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Types and purposes of public, private and voluntary organizations and legal structures of
Burberry Group PLC...................................................................................................................1
P2. Size and scope of a range of different types of organizations...............................................3
TASK 2............................................................................................................................................6
P3. Relationship between different organizational functions and relation to organizational
objectives and structure...............................................................................................................6
TASK 3............................................................................................................................................8
P4. Positive and negative impact of macro environment upon business operations of Burberry
Group PLC...................................................................................................................................8
TASK 4............................................................................................................................................9
P5. Internal and external analysis to identify strengths and weaknesses of Burberry Group PLC
.....................................................................................................................................................9
P6. Interrelation of strengths and weaknesses with external macro factors of Burberry Group
PLC............................................................................................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

LIST OF FIGURES
Figure 1: Organizational structure of Virgin Group........................................................................5
Figure 2: Organizational Structure of Burberry Group PLC...........................................................8
Figure 3: Macro environmental factors.........................................................................................10

INTRODUCTION
Business is an activity of an organization or economic system where goods and services
are exchanged for one another with an aim of making profit. Business environment consists of
the factors, forces, individuals and entities which influence an organization where it operates.
Report on business and business environment is prepared with the purpose of understanding
these internal and external environmental factors which affect the business operations and
organizational structure of Burberry Group PLC. The present report will investigate internal and
external environment of Burberry to understand the micro and macro factors which affect its
operations, and organizational structure. It will explain these factors by conducting PESTLE and
SWOT analysis. Also, its positive and negative impacts will be discussed. Strategies needed to
be developed by business for coping up with uncertain and turbulent business environment after
UK’s referendum decision to leave European Union will be explained as well.
LO 1
P1. Types and purposes of public, private and voluntary organizations and legal structures of
Burberry Group PLC
Overview
Business environment is the collection of several conditions i.e. institutional, political,
social, legal and economic factors that are uncontrollable has and have impact on functions of
Burberry Group PLC with affecting its organizational structure and business (Boons and Lüdeke-
Freund, 2013). Business environment includes internal factors comprising employees, objectives,
culture, vision and mission that are under its control. External factors include economy, market,
government, stakeholders and media which are beyond business control which might cause a
threat to the organization. It is the collection of internal and external factors that affect a business
in its operations, performance, functions, growth and survival.
Background
Burberry is a public limited company listed on the London Stock Exchange and is a
constituent of Financial Times Stock Exchange 100 index. It was founded by Thomas Burberry
in 1856 with the concept of developing fashion garments which later on shifted to a high fashion
market after development of Gabardine fabric which is breathable and waterproof (HISTORY,
1

2018). The brand has multiple stores and franchises all over the world which began selling online
in US and UK in 2006 October.
Different types, size and scope of organizations
Private Sector
Private sector is run by private individuals, groups and companies with the motive of
earning or generating profit by employing workers. It is the part of national economy that is
owned, managed and controlled by forming new enterprise or privatizing a public sector
organization. Sole proprietorships, Partnerships, SME’s, Trade unions etc are some private sector
businesses which are diverse area and has a huge role on economy of a country. Virgin Group is
a leading investment company with a global identity and brand image which renders various
products and services including mobile telephony, travel, holidays, music, health and financial
services. It has operations around 50 countries with more than 50000 employees. Their purpose
is to serve society through delivering quality products and services with a profit making motive.
Public Sector
State sector or Public sector is the part of a country’s economy which is controlled by
national, state or provincial and local governments that comprises of public services and
enterprises (Bughin, Chui and Manyika, 2010). These part of national economy offers goods and
services to the public which cannot be delivered by private sector and is composed of all levels
of government and government controlled enterprises. London North Eastern railway is a British
train operating company that operates long distance inter city services and is owned by
department of transport. It manages 11 stations and intend to render services until a new public-
private partnership is established.
Voluntary Sector
Community or voluntary sector are the organizations whose primary motive is to create
social impact rather than generating profits. These are independent organizations which are
called as civil society, tertiary or not for profit sector in contrast to private and public sector.
National Health services (NHS) England is the world’s largest publically funded healthcare
organization. Its purpose is to serve nation and people for the betterment of society and
communities.
Legal structure of Burberry Group PLC
2

Burberry Group PLC is larger than a joint stock company is an incorporated business run
by Board of directors on shareholder’s behalf where they can vote on certain issue and problems
related to the organization (Cantwell, Dunning, and Lundan, 2010). They are listed company in
the London Stock Exchange where it sells it shares to the general public and raises finance to
meet the capital requirements of the business. It is a legally registered company and to meet the
interests of shareholders issues certificate of incorporation and trading that allows it to sell shares
on the London stock exchange. The licensing segment engaged in royalty’s receipts from firm’s
partners in Japan and global licenses of eyewear, watches and European children wear. The
board of directors are collectively responsible for promotion of Burberry’s long term success to
set strategic aims and ensure agenda of discreet and effective controls.
Analyzing how structure, size and scope of different organizations link to business
objectives and products and services offered by Burberry Group PLC
Structure, size and scope of an organization connects with goals of business organization
which sets a huge target as their aim when having an effective organizational structure. An
organization’s people or employees in organizational structure with fair knowledge regarding
subordinates and roles helps in achieving goals with great clarity. If the size of organization is
huge enormous and huge capital investments can be made as companies set their objectives
based on their scope (Carroll and Shabana, 2010). Main aim of every organization is to serve
customers and earn profit which differs according to firm’s size. Burberry Group PLC involves
products that offer change and attract attention of luxury consumers. They focus on delivering
and creating full outfits for customers adding innovation at every price to add new customer
base. The brand delivers luxury items which includes fragrances, trench coats, sunglasses,
cosmetics, fashion accessories and ready to wear outwear.
Growth of international business environment
Due to liberalization of trade and investment, globalization and support of advanced
technologies, international business grew over 20th century. It has led business organizations to
take several transformations and implement strategies to cope with the changing business
patterns and trends.
P2. Size and scope of a range of different types of organizations
VIRGIN GROUP
Background details of Virgin group
3

Virgin Group Ltd. is a private sector enterprise or company is technology focused venture
investor and a UK based multinational venture capital conglomerate. It was founded in 1989 and
has a portfolio of more than 35 companies spread over the internet.
Products and services offered
Investment team of Virgin is focused on core consumer sectors of Travel and tourism,
music, Media, Telecommunication, Entertainment, Energy, Retail, Money, Beverages, Nonprofit
care services, Earth challenges, Financial services and health and wellness.
Size and scope of organization
Virgin Group is an active technology focused venture capital investment firm which has a
strong network of investors, management teams and alumni’s with having a diversified group
into 200 different businesses (Chesbrough, 2010). It has more than 50,000 employees in more
than 50 countries with revenue of £15 billion in 2012.
Vision
“Changing business for good”
 Think about long term impact of business decisions
 Embedding principles, values in all existing and new business investments.
Mission
 “To embrace the human spirit and let it fly”
 To deliver long term capital appreciation through investment in its sectors and seek for
new opportunities to partner with likeminded potential investors and stakeholders.
Business objectives
 Have clear articulated, embedded and measurable purpose in every business which drives
decisions and enhance success resulting I positive impacts on customers, people,
communities and environment.
 To become a global business leader by pioneering systemic change and rising to
challenges.
 To serve customers as per their expectations with high standard innovative services in a
cost efficient manner.
Organizational structure
Virgin Group follows a decentralized decision making process with a focus on
independent responsibility for each business’s development. It follows a structure based on the
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product areas and separated with specialized goals. The strategy is common in its all businesses
with a strong dynamic corporate culture, transformational and charismatic leadership. It has a flat
and multi hierarchical teams with a flexible structure that is people oriented innovative, creative,
future and customer oriented approach.
Figure 1: Organizational structure of Virgin Group
Stakeholder’s information
Virgin Group’s enthusiastic employees are the excellent brand ambassadors who place
the brand at top position in market that help them in achieving growth and success. The
organization prioritizes their employees more as well motivated staff can help in gaining happy
customers.
BURBERRY GROUP PLC
Background details of Burberry Group PLC
Burberry Group PLC is a public limited company headquartered in London which is a
luxury fashion house and has branded stores and franchises around the world (Commander and
Svejnar, 2011). It is listed on the London stock exchange and is famous for its trench coats.
Products and services offered
Burberry is a luxury brand which offers high quality products to consumers delivered
through a combination of superior organic profit growth and continued generation of cash with a
commitment to capital allocation framework. The brand delivers luxury items which includes
fragrances, trench coats, sunglasses, cosmetics, fashion accessories and ready to wear outwear.
Size and scope of organization
Burberry Group PLC has 10,000 employees globally and operates around the world
through franchises and stores. It supports business and society diversity
5
Virgin Group
Air Travel Mobile Financial Retail Hotels and
Leisure Music Rail

Vision
 Establish position in luxury fashion by sharpening positioning in most rewarding and
enduring segment of market.
 Attain sustainable growth and higher margins over time and gain attractive returns.
 Operate responsibly and uphold labor standards throughout operations and activities.
 Attain cross functional connections with a range of team building opportunities and
unique culture
Mission
“Six pillars of strategy- Product, Communication, Distribution and Digital, Operational
Excellence and Inspired People”
Business objectives
Burberry Group PLC’s business model is structured by channel, region and product
division that is supported by corporate functions (Laumer, Eckhardt and Weitzel, 2010). The
luxury brand is aimed at creating authentic and distinctive products to by bringing new fashion to
create good customer engagement, brand value, inspiration and goodwill. The brand also aims at
shareholder value generation, employee’s rewards and recognition for retention, support other
businesses and partners to improve resource efficiency and wellbeing of employees and serve
community by addressing key needs.
Organizational structure
Chief people of strategy and corporate affairs are responsible for all internal people and
health and safety matters of the Burberry Group PLC. The luxury brand also consists executive
team to progress against responsibility goals by reviewing regularly. External advisory
Committee group of leading stakeholders independently with expertise advices on drafting
strategies. Foundation board upholds vision and ensures delivery of charitable purposes.
Stakeholder’s information
Burberry Group PLC is aimed at creating good and long lasting relation with their
customers, Partners, supporters and stakeholders to create a distinctive business identity.
NATIONAL HEALTH SERVICES (NHS)
Background Details of National Health Services
6

NHS is the public health services in UK which is a collective organization established in
1948 as one of the major social reforms after Second World War. It is a public funded healthcare
system for England and is the largest single payer healthcare in world.
Products and services offered
Main services offered by NHS includes; urgent and emergency care, mental, sexual
health services, hospitals, pharmacies, opticians and dentists.
Size and scope of organization
NHS provide majority of healthcare in England that consists of primary care, in patient,
long term patient car, ophthalmology and dentistry. It employees more than 1.4 million
individuals and is operating since 70 years.
Vision
Enable people to live healthier and more independent lives through a high quality,
effective harmonized care.
Mission
“To provide services and care that families and society would want to use”.
Business objectives
NHS is planning to improve the health and wellbeing of local communities, capitalize
and build a strong base to develop local integrated systems and innovative ways of working, test
new ideas while considering risks and explore new opportunities and markets.
Organizational structure
Secretary of state is responsible for the overall work of Department of Health and Social
care which provides a strategic leadership for public health and funding for both in in England. It
is supported by 23 agencies and public bodies. NHS has an independent body and is the
commissioner of primary care services.
Stakeholder’s information
NHS involves people in decisions about health care and consult and include them while
planning or changing commissioned health services. Contributors, commissioners, customers,
collaborators, channels, etc. are some of their main stakeholders who is hugely depend on NHS’s
interest concerns and activities.
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LO 2
P3. Relationship between different organizational functions and the way they are linked to
organizational objectives and structure
Interrelationships between organizational functions and impact on Burberry Group PLC’s
organizational structure
Organizational structures depend on business functions of Burberry Group PLC as it
makes their structure and objectives to serve the customers. They generate objectives to increase
productivity and create an effective organizational assembly and deliver customers with
distinctive products (Prajogo, 2016). There are various aspects related to various types of
organization that needs to be analyzed effectively which make an impact on business. Some of
the organizational functions that vary indifferent manner in organizations are:
Management: It is an effectual execution of Burberry’s activities by effective
communication of organizational objectives which impact overall performance and decision
making of business. It is done by effective management team involved in managing
organizational activities that affects productivity and profitability of Burberry.
Finance: This department or functional unit of Burberry controls and manages the flow
of capital, cash and resources in and out of the organization. It prepares, allocates and sanctions
fund or capital for investment, advertising, purchase, etc. of Burberry Group. Every department
of Burberry is interrelated with this functional unit as it manages all the cash inflows and
outflows of the organization.
Human Resource /Administration: It is necessary to effectively execute activities in
Burberry which are related to hierarchy that lead to taking flow and delegation of responsibilities
and roles that affects overall performances. It also includes delegating authorities and tasks,
providing training and development to employees to make organization’s productivity better.
Advantages:
 Inter employee relationship among various organizational functions assists business to
maintain cooperation that will lead to increased productivity and profitability.
 It increases effectiveness in business through association of employees
 Rises profitability level of organization and business as every employee of different
functional department shares information
Disadvantages:
8