Business Environment Analysis: Organizations, Structure, and PESTLE

This report provides an introduction to the business environment, defining its influence on organizations and their operations. It offers an overview of different types of organizations, including public, private, and volunteer entities, with examples such as HSBC Holding Plc, River Island, and Cancer Research UK. The report delves into the size, scope, and legal structures of these organizations, detailing their products, services, and objectives. It further examines the interrelationship between various business functions within HSBC, such as human resources, marketing, and finance, and how these functions are structured. The report also applies PESTLE analysis to identify macro-environmental factors impacting HSBC, including political, economic, social, technological, legal, and environmental factors, and their influence on the organization's activities and transactions.

BUSINESS & BUSINESS
ENVIRONMENT

INTRODUCTION
Business environment refers the collection of all individual, firms and other elements
which can or can not be under control of the firm but can affect this performance, profits and
growth and even survival. Every business operates in characteristic environment. Such as
environment influences business and gets affected by its actions (Bah and Fang, 2015).
Company easily identify, analysis and react of forces when the business person possess a good
understanding of business environment. This report will give introduction an overview with
explain of different types of organizations and growth of international business environment. It
will explain background, size and scope, legal structure and stakeholder of different
organizations.
TASK 1
Overview of organizations and their growth in international
There are different types of organizations such as public, “private” and volunteer that
have a different overview and their growth in international environment.
Public Organization:
It is the part of the economy composed of both public services and enterprisers. Public
sector organization is firm that is publicly controlled or funded. The public sector comprises to
government and public agencies. These organizations can be found throughout the world and
give a broad range of services (Belás and et.al., 2014). It provides education to members of the
public. Many public sector organisations are governed by regulations that ensures equal chances
for everyone. These companies are funded by authority or public. They are responsible to
everyone within a community and rarely overseen by both government agencies and public
interest groups. For example: HSBC holding Plc. It is the public limited company which
operates banking and financial services.
Private Organization:
Private companies are the business which owned by non-governmental companies or by a
small number of shareholder. It is part of the economic system of nation that is run by single
persons and companies instead of authority (Grosanu and et.al., 2015). Many of private sector
companies are run with an intention of making profits. It is also known as privately held
company. Privately held firms are owned by founders and their families as well as heirs or by a
small group of investors. Sometimes, employees are holding shares of private organizations. For

example: River Island. It is the private company which operates in selling clothing, footwear and
accessories.
Volunteer Organization:
It is also called as a voluntary group which is the group of single persons who enter into
an agreement usually volunteers to form of body and to achieve purpose. Some example involve
trade associations, trade unions, professional institutions and environmental groups. The terms
voluntary organization cover every type of group from small local Residents to large associations
with multimillion pound turnover that run large scale operations of business (Clarke, Li and Xu,
2016). Voluntary groups are the wider and actual form of non-profits companies and they have
existed since history. Associations that are organized for profit and financial gain are usually
known partnerships. For example: Cancer Research UK. It is volunteers organization which
specialises in cancer research and awareness charity in UK. In this context, different types of
voluntary organization such as unincorporated, incorporated, company and charitable
organization. Selected company is a charitable organization.
Size, scope and legal structure of different organization
Public Organizations- HSBC Holding Plc
HSBC is British international banking as well as financial services ownership
organization. It is the 7th largest bank in the worldwide. HSBC traces its origin in Hong Kong.
The present form was accepted in London by Hongkong and Shanghai Banking Corporation to
act as new group holding company.
Product and Services:
HSBC provide range of product and services such as retail banking, corporate banking,
mortgage loan, wealth management, credit card, finance and insurance (Bagautdinova and et.al.,
2014).
Size and Scope:
HSBC has important outcomes in all of world's financial marketplace with Americas,
Asia Pacific each representing around one third of its business. It is the biggest bank in
Hongkong's local currency is its name. Global business serve more than 38 million consumers
worldwide through the network that covers 66 nations.
Legal Structure:

It is the public limited which serve financial and banking services to public. It is the
limited liability company whose shares can freely sold and traded to public with the minimum
share capital of £50000.
Mission, Vision and Objectives:
To serve 46 million communities direct four international businesses such as commercial
banking, retail banking, wealth management and worldwide private banking (Lee and et.al.,
2015). The vision is to aspire to be one of the world's great specialist banking groups driven by
loyalty to their core beliefs and values.
Private Organization-River Island
It is UK high street fashion brand such as clothings to men's, women's and children which
operates in a number of worldwide markets. River Island has an in house design team at its West
London Headquarters.
Product and Services:
River Island operates in selling men's, women's and children clothing, footwear and
accessories in the worldwide (Kuipers and et.al., 2014).
Size and Scope:
The company has over 350 stores in the UK, Ireland, Asia alongside 6 online websites
that operates in 4 currencies and over 100 nations worldwide. It is one of the most well-known
and loved brands on the high street with over 60 years of fashion retailing experiences.
Legal Structure:
River Island is a private organization which owned by Lewis family. The company is
setting by Bernard Lewis and his brother in London.
Mission, Vision and Objectives:
The objectives of River Ireland is to bring new and original fashion to consumers with
create great design at the heart of everything. The mission statement of company is to set up to
give services of selling fashionable clothing to young men and women on a conscious budget.
Voluntary Organization-Cancer Research UK
It is cancer examination as well as awareness charity in UK. It conducts reserach into
hindrance, diagnosis and treatment of disease (Bouckaert, Peters and Verhoest, 2016). Also, it
provides info about career and efforts campaigns for raising awareness of diseases as well as
effecting public policy. It is the world's largest independent cancer research charity.

Cancer Research is the charitable organization which is also a limited company that aims
charitable. This company made by mergers of an Imperial Cancer Research Fund and Cancer
Research Campaign. They provide charity services like health services for reducing a cancer
patients.
Product and Services:
Cancer Research UK provides treatment of cancer patients and reduce the number of
death with reason of cancer.
Size and Scope:
There are 3964 employees work and 40000 volunteers in Cancer Research UK. The
charity funds work over 4000 investigators, doctors and nurses throughout UK and help to over
200 clinical to study cancer risk over million people in UK.
Legal Structure:
Organization has formed by the merger of The Cancer Research Campaign and Cancer
Research Fund. The work of Cancer Research is almost funded by the public (Menzel, 2014).
Research actions are carried out in associations, educational institutions and hospitals across the
UK, both by the employees of own charity's and its grant-funded investigators.
Mission, Vision and Objectives:
The objective of Cancer Research is to decrease a number of death from cancer. To
prevent, control and cure cancer through ground breaking the study and in the last 40 years their
work has assisted double living rates.
Interrelationship between functions and organizational structure
HSBC has many functions such as operational, functional, company secretary, global
communication, global finance, internal audit, legal, marketing, financial crime risk, human
resources in the organization (Roehrich, Lewis and George, 2014). The functional organization
structure use by company. These functions are interrelated with each other. In this structure,
employees are grouped based on their roles and functions outcome in functional units such as
marketing, HR, finance etc.
A Global Human Resource Department: The major functions of this department are
recruitment, training and development, employee service and security. Human resource division
is very much concerned with discipline that is set up by an HSBC group. HR is responsible for
implementing people strategy of HSBC. It serves talent management, succession planning,

employees mobility while determining and overseeing the framework that help performance
management, rewards, resourcing and an engagement (Bah and Fang, 2015). HR functions are
interrelated with marketing functions, because HR manager ensure that recruit and select those
candidates who have an ability to marketing of product and services of HSBC. The advantage of
this is to effective workforce planning and resourcing in the firm. The disadvantage of this is to
take a large amount of money and time.
Global Marketing: It assists their international business raise their revenues by ensuring
that they make the most effective marketplace chances, brand strengths and customer perception.
They have dedicated marketing team that work with their international business which helps
them achieve strategic priorities (Functional Organizational Structure, 2016). Marketing team in
Illustration 1: Functional Organizational Structure
Source: (Functional Organizational Structure. 2016)

following areas such as advertising and marketing communication, a digital customer
engagement, sponsorship and events, brand design, marketing governance and marketing
planning as well as budgeting. Marketing functions are interrelated with finance activity of
HSBC, because of these activities are organized through allocated budget. The advantage is to
increase sales and make profits. The disadvantage is to increase the financial cost and investment
of time of business.
International Finance: This function shows a wider role in assure that HSBC manage
costs as well as deploys capital in the most effective manner. The finance team provides financial
insight, quality and control, utilising analytical abilities to help their business, influence and
challenge decisions of business (Belás and et.al., 2014). Human resource functions are
interrelated with finance activities, because of HR manager ensure that hire those people who
have ability to handle all the financial records of the firm. The advantage is to improve the
financial position of company. The disadvantage is to increase and control financial risk in the
business.
TASK 2
PESTLE Analysis to identify macro environment factors
PESTLE analysis is used to identify and determine macro environment factors such as
political, economic, social, legal, technological and environmental which directly impact on
operations and activities of any organization. Therefore, these factors also influenced on
functions and transactions of HSBC.
POLITICAL FACTOR:
Changes in regulations which govern by government such as trade policy, taxation,
limitation and restriction that directly impacts transactions of HSBC. For example: political
development is the location is possible to provide market excitability. It impacts cross the
broader model of banking and affected on needs and wants of consumers (Grosanu and et.al.,
2015). The result of political discussion will be affected on financial capability and risk
management services of HSBC. This impact positively on capacities and management services
of organization.
ECONOMIC FACTOR:
It involves interest rate, inflation rate, a foreign exchange rates which are directly
impacted on organizations' operations. For example: many of the financial organization has been

affected by 2008 financial crisis that was a real liquidity problem. The stability of economic
factors of foreign exchange rate and stock markets are contributing elements help to HSBC
survive the 2008 financial crisis (Clarke, Li and Xu, 2016). Therefore, successful economic
strengths of organization, so that, this kind of factor impact positively on transactions of HSBC.
SOCIAL FACTOR:
These factors involve changing social trends, taste and preferences of consumers which
are directly affected on organization. Also, social factor includes workforce diversity, education
programs of HSBC, digitization of demography etc. For example: the company has promoted
health communication of various communities, cultures and people that impact positively on
people of firm, so that this impact positively on operations of organization.
TECHNOLOGICAL FACTOR:
Technological advancements effect daily basis operation on HSBC in terms of shares
information of company (Bagautdinova and et.al., 2014). Firm is international bank utilises the
very latest technology that can create them assailable to like of cyber attack. It involves need for
automation and digitization that impact positively transactions of bank and fulfil consumer
needs.
LEGAL FACTOR:
Changes in laws such as consumer rights, employment legislation which are directly
influenced in an operation of HSBC. For example: the main issue is mis-sold of payment
protection insurance (PPI) but consumers have not any kind of information of PPI. This kind of
issue affects negatively on business. Company need to create of the UK ring fenced bank which
is suggested by Independent Commission on Banking in 2011
ENVIRONMENTAL FACTOR:
Environmental factors impact on operations and initiatives that impact on business
transaction. For example: The company's goals is to decrease carbon emergence from workers
and improves process and technology to create thing better through lower carbon energy
programs, paperless banking, green building programs and reducing waste etc. that are positively
affected on a transaction of HSBC.
SWOT Analysis to determine strength and weakness
SWOT analysis is utilised to determine strengths, weakness, opportunities and threats of
organization. This help to beat competitive advantage in industry.

STRENGTHS:
The strength is to well capitalised which refers to that it has been able to hold economic
volatility and some of credit crises that influenced competition of HSBC. There is a strong
capital position supported by Capital Equity Ratio. According to this, the company need strategic
measures that will lower Risk Weighted Assets of business. There is good dividend history of
firm by attractive investment for investors of HSBC. Company has given stable and sustainable
dividends to control investor confidence. The firm combined operating model with capital
strengths and a global network that can give HSBC protect amidst political and economic
disabilities.
WEAKNESSES:
The weakness of HSBC is to rise operating cost and lack of good consumer experiences.
HSBC organisation with a small enterprise sector that has created it assailable to more hazard
which can lead to profit shortfalls. Organization has declared lay-offs as part of some of cost-
cutting assesses that has promoted the negative idea of the bank with its retained talent and
stakeholder base. Due to homogenised image, company branding has been directed on
positioning as an international bank, losing connection with localised consumers. It does not
acknowledge local requirements. The company has declared into possible foreign exchange trade
market manipulations which does not fix their reputation.
OPPORTUNITIES:
The strong capitalisation position of HSBC that can help to adopt extra assets to further
strengths of the bank and sustain their business model. Through the acquisition, company has
chance to gain market share and foothold in an emerging markets. Organization will grow
international position that help to reduce impact on external factors such as financial risk and
credit issues (Bouckaert, Peters and Verhoest, 2016). This will also impact competition of firm.
Also, HSBC provides reliable and safe place to invest money for the chance to position.
Therefore, lending capabilities of company. HSBC's own misstep that is negative press reporting
of challengers that has rarely umbrageous which can provide chance to concerted on upcoming
cleaning up image putting any troubles and exploration of their consumer mind.
THREATS:
Due to fiscal losing, credit issues and wrong attitude between world's bank and financial
organizations that HSBC can threats by prospects and fear of losses of consumers. This can lead

to decrease a pool of expectation of consumers. An international credit situation has led to
challenges for all banks in relation to lend goods for many of consumers base. It is decreasing the
ability to lend to many prospects (Menzel, 2014). The organization can also change their
covering execution and give more indication of its lending, banking and investment practices.
Due to financial crime, the whole banking and financial industry are faced threats whereby
unauthorised people illegally access and hack into the financial system.
SWOT analysis of JP Morgan
JP Morgan is the multinational investment bank and financial services company
headquartered in New York.
STRENGTHS:
Company has good financial position and strong brand name that are strengths of JP
Morgan. There are over 250000 around the world and global presences of the company.
WEAKNESSES:
Strong competition from other financial services providers and fluctuation markets result
in instability. JP Morgan is highly dependent on USA which is weakness of firm.
OPPORTUNITIES:
Company create chance in relation to diversify the portfolio for consumers and expanding
their business in other nations.
THREATS:
Changing the government regulations and financial risks like recessions which are highly
threats of JP Morgan.
Interrelationship between strengths, weakness with external factors
The strengths and weakness of company are interrelated with external factors of a macro
environment which are affected the organization. HSBC follow environmental regulations and
policies such as waste management, usage low carbon, sustainable engagement that can reduce
environmental impact on operations of company. Firm need to follow advance technology that
impact in relation to increase consumer expectation and prospectives (Roehrich, Lewis and
George, 2014). This create interrelation between social factors and threats of HSBC. This
technology factor also reduce threats in relation to hacking and cyber attack which directly
impacted on transactions of organization. In this context, the firm composed operating model
with capital strengths and a global network that can give HSBC protect amidst political and

economic disabilities. Organization will grow international position that help to cut down an
impact of external factors such as financial risk and credit issues.
Reflection of findings and impact on decisions making process
I have found that HSBC must have followed all regulations and policies such as foreign
exchange rate, taxation policy, because these factors are directly impact on transactions of
company as well as impact on a consumers needs. Also, I have recovered that company need to
growth of commercial banking and global markets that help to increase economic strength of
business. I have supported that company require focusing on organizing the education programs
that can help to increase the level of education to people and living of standards in society. I have
founded that company need to adopt advance digitization to easy transaction on internet, so that
consumers are effectively done their transactions related to the bank. For reduce legal influences,
HSBC needs to creation of UK ring fenced bank which is suggested by an Independent
Commission of Bank (Grosanu and et.al., 2015). Therefore, this transaction ranks on the
priorities list of performance for HSBC.
I have found that the company needs to adopt a False Claim Act to manage their payment
protection insurances claims. With these, they face bad press for delaying payments. I have
recovered that following all environmental policies such as waste management, usage low
carbon, sustainable engagement that can reduce legal impact on operations of company. I have
found that the company make climate champion programs for safe and protect an environment.
In this context, I have recovered that the company needs to exploit strength and opportunities for
reducing the weakness and threats of business. I have found that firm combined operating a
model with capital strengths and a global network that can give HSBC protect amidst political
and economic disabilities. In relation to, I have recovered that strong capitalization is affected
share buybacks and give sustainable dividend by HSBC.
CONCLUSION
This report has summarised that determine an overview of public, private and voluntary
organization with international growth environment. It has concluded that determine size and
scope, a legal structure of HSBC holding Plc as the public organization, River Ireland as the
private organization and Cancer Research UK as the voluntary organization. It has discussed that
political development, 2008 financial crisis, education programs of HSBC and Technological
advancements decrease carbon emission that directly impact on operations and activities of