Business Environment Analysis: Jaguar UK and Ronald McDonald's Report

This report provides a comprehensive analysis of the business environment, focusing on the public, private, and voluntary sectors. It examines the organizational structures and objectives of businesses, including the functional, divisional, and matrix structures, highlighting their relationships. The report uses Jaguar UK and Ronald McDonald's as case studies, exploring their scopes, sizes, and the impacts of internal and external factors. It analyzes the positive and negative effects of the macro environment on business operations, as well as the interrelation between strengths, weaknesses, and external macro factors. The study aims to provide a clear understanding of how businesses operate within their environments and how they make decisions based on various factors.

Business and the
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................4
P1 Types and purpose of public, private and voluntary sectors..................................................4
P2 Scope and size of different types of organisation..................................................................6
P3 Relationship between organisational functions that are linked with organisation' structure
and objective...............................................................................................................................7
PART 2............................................................................................................................................9
P4 Positive and negative impacts of macro environment on operations of business .................9
P5 Internal and external analysis of Jaguar to identify strengths and weakness.......................11
P6 Interrelation of strengths and weakness with external macro factors..................................12
CONCLUSION..............................................................................................................................13
REFERENCES .............................................................................................................................14

INTRODUCTION
Business which is also known as any company, enterprise or firm is called the entity of
the organisation which is involved in providing services and goods to the customer or users.
Business do not work in a vacuum but they work in a particular environment which is called the
business environment. Business environment can be defined as the combination of external and
the internal environment that affects the business (Bryman and Bell, 2015). Internal factors and
the external factors have influence on each other and they work together so as to affect the
environment of the business. This report is based on the topic of business and the business
environment and it is based on the case of two companies that are Jaguar UK which is a profit
generating company and Ronald Mcdonalds which is a non profit company. The aim of the study
is to analyse various types of organisation including their scope, size and will also help in
determining how they operate in the environment. Relationship of the organisation with different
stakeholders and the effect of external environment on the decision making of the business will
also be explored in this study. Positive and negative impact, strengths and the weakness of the
macro factors on the business will be analysed in the report which will help business in a way or
other.
PART 1
P1 Types and purpose of public, private and voluntary sectors
There are different types of organisation that operates in a business environment. These
types of organisations can be like public, private and voluntary sectors. Public sector
organisations are those which are run and owned by the government for the people. People are
used to pay tax to the government and the money which is received is used to finance public
sector organisations (Casadesus-Masanell and Ricart, 2010). Ronald Mcdonalds is also a type of
public sector organisation as it is non profit organisation.
Types of public sector :
 Departmental Organisation : It is the prominent form of public enterprise because it is
easy for the government to create such enterprise in the framework of the organisation for
the departments who are existing already and in such organisations initial stage of
development are small.

 Public Corporation : It is the type of autonomous organisation with the power of
government but it is but it is flexible and have initiative of private organisation. It is
owned by the state.
 Government Company : It is the another form of public sector. It is the organisation
which is registered under the Companies Act and in this government hold 51% equity
capital (Chavis, Klapper and Love, 2011).
 Joint Enterprise : Participation of the state in economic activity with the private sector
form such type of enterprise which is known as joint enterprise.
 Development Corporation : It can be defined as the autonomous agency in public area,
which is there to promote economic activities instead of operating through subsidizing
system.
Purpose of public sector :
 The main aim of this sector is to provide necessary public services.
 To make appropriate use of the available resources for the benefit of the society.
 There is no motivation regarding profit in this sector, they aims to provide services.
 They aims to provide, produce and buy.
Another type of sector is the private sector organisation, in this the business is run and
owned by the private individuals. There are several types of private sector business that are
operating in the business environment (Chesbrough, 2010). Jaguar UK is the type of private
sector.
Types of private sector :
 Sole Proprietor : This type of business is owned by a single person. There is only one
owner of the business, and he is the boss as well as worker.
 Partnership : It is the type of business which is operated by the two to twenty members
and registered under the partnership act 1890. The profit and the revenue from the
business is divided according the capital which is being invested by the partners.
 Companies : Company normally have 2 to 50 people and the and the share of the
companies can only be sold to the limited number of people.
 Franchise : It is the type of business which already exist and has made its reputation.
They use to sell their copyright to the interested public (Craig and Campbell, 2012).
Purpose of private sector

 The main aim is to make growth and the profit.
 They aims to increase market share and wants to maximise sales.
Voluntary groups are the types of group which are no owned by any single person , in
this someone is responsible to make sure that the targets and the budgets are achieved by them
which they have set up. They can be like charities, social welfare organisation, foundations,
community groups etc. Their main purpose is to help people in the society (Gecevska and et.al.,
2010).
Jaguar UK is a type of private company, it is a brand of luxury vehicle which is owned
and produced by the Jaguar Land Rover in UK in 1936. They operate worldwide and is doing
very good in the premium segment. There product type is cars. Their purpose is to build a
responsible business and wants to operate for a long time. They aims to incorporate both short
and long term environmental, economic and social consideration into their decision making for
the benefit of products and services.
Ronald McDonald is the non profit and individual organisation. Its formation took place
on 15 October, 1974. It has a global network in around 63 countries. They deal in the healthcare,
social welfare and charity. Their main purpose is to make, find and assist those programs that
improve the well being and health of the people and children (Hamilton and Webster, 2015).
P2 Scope and size of different types of organisation
Public sector includes the local government, national government, sub national
government and the regulatory bodies. Not every business which is operating in the business
environment measures it success by the profit, there are many non profit organisation who are
operating for giving services to the customers. They says that profit is not wrong but it is their
belief that the profit which is sustainable and reasonable is the best by giving quality services to
their customers (Klapper and Parker, 2010). Ronald McDonald works on this principle as they
are the non profit organisation, and operates for the welfare of the people. This thing does not
explains that the businesses who are making profit cut the corners and compromise on the quality
of the products and the services. Jaguar UK is the type of profit organisation, and they are
delivering quality products to their customers as well making good profit. Scope of the various
business activities can be defined as :
 Local : It is the business which is owned locally and it serves the local area, like
independent shops which is operated by the local residents.

 National : The business which get expanded nationally and is on a frequent basis, it can
be like any franchise which is opened by a company in other areas.
 International : In this the transactions of the business takes place beyond the national
borders. International business gets many opportunity to sell its services and products
around the world (Klapper, Lewin and Delgado, 2011).
Jaguar is ranked as on of the best employer in the UK and it is found it is a choice of
many people who wants to be part of the company. They exported nearly 80 percent vehicles that
they produce on the retail basis. They employed approx 38000 people around the world and gets
support of the global network of 2720 retailers. They have won 150 awards in 2016 and have
invested £3.1 bn. Future success of the company will be on the basis of continuous process to
anticipate new trends of the market. They have guidance of their strategic plans as well by their
proprietary scenario of mapping tools which will help in identifying the growing opportunities of
the business. They have expanded there business nationally and internationally , they are
reaching more and more customers globally so as to increase their growth and success in the
market. Jaguar currently have six main facilities of manufacturing, R&D and vehicle assembly.
Five are in UK and one is operating in India (Kolk and Van Tulder, 2010).
Ronald McDonald which is a non profit organisation has a global network in the 63
countries and the regions of the three programs, that are Ronald McDonald House which is in 42
countries and is a place to stay for families of hospitalized children. Ronald McDonald family
room is in 24 countries and 3000 families can stay who are there in the community and are not
having prescribed criteria to stay in Ronald McDonald house, and Ronald McDonald care mobile
is in 9 countries and they the mobile clinics. The scope of company can be seen from
international prospective. In the year 1981, Ronald McDonald House was opened in Toronto. In
1991, they opened 150th house in Paris which is now closed. In 2005 they opened 250th house in
Caracas. Currently there are 324 houses of Ronald McDonald (Teece, 2010).
P3 Relationship between organisational functions that are linked with organisation' structure and
objective
There are different types of functions that are being carried out in Jaguar UK and Ronald
McDonald. These functions can be defined as the functions related to the HR, finance, sales,
marketing and production. These different types of functions have direct link with the objectives
of the organisation and its structure, as they are the key factors which helps in achieving the

success and growth in the organisation. There are different types of organisational structure that
have relationship with functions of the organisation (What are the different forms of public
sector enterprises?. 2012). Functional Structure : Most of the business operates in the functional structure of the
organisation. Jaguar UK is one of them. In this type of structure there are different
functions that are there in the different departments and they report to the manager of the
specific departments, who then report to the higher authority. In this type of structure
lines of authority are very clear and each and every employee concentrate on his work
(Trkman, 2010). Divisional Structure : In this type of organisation structure, functions are spread across
various branches. Jaguar UK operates in this kind of structure also as it have various
products lines and the division of every product has its own sales, marketing, R&D and
accounting departments. Each branch as their concerned people to carry out a function. Matrix Structure : If a matrix structure is being used by the company then it helps in
giving the great flexibility to the functions of the business and the Ronald McDonald is
using it (Wheelen and Hunger, 2011). In this each and every employee work in the
departments which are function based like finance or marketing, but the projects can be
assigned to them among different managers. This type of structure helps in adapting the
organisational functions for the different needs of the organisation.
 Organizational Charts : If there is trouble in visualizing the structure of the company
then the organisational chart can be used to see it. This chart shows the authority lines
and the control that is there in the different departments and the different management
levels. If the chart will be well designed then it will be easy to see who will make
decisions (Vitale, Giglierano and Pfoertsch, 2010).
Functions of the organisation helps in achieving the business objectives. There are many
business objectives of the company that are related with the various functions like achievement
of sales, marketing activities for the promotion of business activities, proper management of
human resource etc. Various departments who are related with these activities help in the
achievement of the objectives which eventually help in the growth and success of the business.
Jaguar UK and Ronald McDonald create many objectives that are related with the various
functions of the organisation.

The main aim of the jaguar is to produce the breathtaking performance cars by reducing
the impact on environment. They wants to have innovation and creativity in there products and to
achieve this the R&D function and the marketing function will help in doing this as it will help in
giving the whole market survey and will also help in analysing the competitors strategies. The
objective of Ronald McDonald is to find, support and create such programs that will improve the
well being and heath of the families and for this their development department performs various
functions for achieving this objective (Wheelen and Hunger, 2011).
In the functional organisation structure employees are managed by a person who have
experience in the same field and can easily understand the work. Functional areas may
sometimes have difficulty in working with other functions, they can compete with other areas of
function regarding resources. In matrix structure there will be decentralised decision making and
will help in improving the monitoring of environment but there may high cost and high conflicts.
According to Teece (2010), line organisation structure clarify and simplify responsibility
and authority but they if there will be large firm then this structure will be ineffective. Line and
the staff structure gives high flexibility but there be difficulty in the coordination between line
and staff. As per Gecevska and et.al. (2010) in the project organisational structure work is
divided by specific target and goals but the work is critical in terms of gain and the work may be
complex.
PART 2
P4 Positive and negative impacts of macro environment on operations of business
Macro environment can be defined as the condition that is there in the economy rather
than in a specific region or sector. These are the those factors that are uncontrollable and external
and have impact on the decision making of the organisation. It also affects the strategies and
performance of the business. Jaguar UK and Ronald McDonald also have effect of macro
environment either in positive or negative way. The factors of the macro environment includes
the demographic, economic, legal, social, political, technological factors and the natural forces. Political factors : These factors can be defined as the political environment stability and
the attitude of the political movements and parties. This can be defined as the influence
of government on the policies of tax and the involvement of government in the

agreements regarding trading. These factors can add risk to the business and will lead to
major loss. Increase and decrease in the tax can be the example of political element. Economic Factors : It represents the wide economy and will include the employment
and unemployment level, economic growth rate, raw material cost like petrol, energy,
steel, monetary policy, inflation and exchange rate. It influence the competition nature
that is being faced by the company and the resources related to finance which are there
with the economy (PESTLE - Macro Environmental Analysis. 2015). Socio-cultural Factors : These kind of factors help in representing the culture of the
society of community in which the company operates. It includes the growth rate of the
population, education level, age distribution, demographics, lifestyle and living
conditions. It helps business in analysing how the customer work, think and live to
whom they are targeting. It helps business in making good advertisement techniques and
analysing the changing preference of the customers. Technological Factors : It defines the rate of development and new inventions, change
in the technology and the information, change in the e-commerce and the internet. It
helps in focusing on the technological developments that will help the business to adopt
the new technologies, and will also help in reducing the cost of the business. With the
help of it business can make the secure environment. Environmental Factors : These factors includes those issues like disposal of the waste,
limited amount of natural resources and the procedure related to recycling. These factors
help the business in analysing the types of resources which are needed by the
organisation so as to operate effectively in the business environment (Wild, Wild and
Han, 2014).
 Legal Factors : These factors are like the trade restrictions and the regulations,
employment laws, rules and monopolies and the protection of the consumer. These
factors affect the business regarding policies, regulations and rules, which company
make in the to operate in the environment.
Examples of the influence of the macro environment can be like change in the interest
rate, competitors, change in the taste of the culture, disastrous weather and the regulations of the
government. Positive and the negative impact of the macro environment that have influence on
Jaguar UK and Ronald McDonald can be like :

Positive Impact
 It involves the expertise and the cross functional skills.
 It helps in reducing the effect and impact of threats.
 It helps in encouraging the strategic thinking development (Zott and Amit, 2010).
 It provide mechanism which help business in identifying new opportunities.
Negative Impacts
 Oversimplification of the information can be done by users for making the decisions.
 This process needs regular implementation so as to give effective results but
organisations fails to do this.
 To access the sources of the external data can be costly and time consuming.
 The data is based on the assumptions which are there to make analysis and that can be
sometimes bad (Zott, Amit and Massa, 2011).
P5 Internal and external analysis of Jaguar to identify strengths and weakness
The internal environment focus on those factors that are inside the organisation. These
factors are there in the relation to the elements like culture of the company, management style
which affects the operations. The mission of the company is the brief and to the point statement,
the mission of the Jaguar is to make fast cars that will help the people to enjoy more. The
mission of the company creates no doubt and explains clearly what is the overall aim of the
company. The vision of the company is to make top range of the cars. It outlines the aim of the
company and where they want to see themselves. The culture of the company consist of the
stories, symbols like logo, power and organisational structure, control systems and the routines
and rituals (Wild, Wild and Han, 2014).
External environment of the company consist of political factors which influence to
continue interest to reduce emission of the carbon from vehicle and factories and to increase the
research in the sources of the alternative fuel. Economic factors are like the current climate
which helps to spend less, change in the age of the retirement. People will pay less for the high
price cars which will cause problem Jaguar lack in budget cars. Social factors like sports car are
less desirable because it is not environment friendly. Research can be done on those cars that are
green and more efficient. Technological factors are like electric and the hybrid cars are more
common and the Jaguar needs to develop such cars or they may face risk. Legal factors are like
change in the change in the laws and regulation of health and safety. Jaguar should adopt such

ways in which company should work so as to accommodate new laws and regulations (Kolk and
Van Tulder, 2010).
The five force model is also there which influence competition in which the Jaguar is
working. This includes the suppliers, buyers, substitutes, new competition ans the existing
competition. Buyers are those people who wants to buy Jaguar's product and services. This can
be done by the distributors and the dealership and also the other manufactures who wants to use
Jaguar's engine. Suppliers are those people who provide machinery and other parts to the Jaguar
for manufacturing their cars. Good relationship between the Jaguar and their supplier is the key
to success. Substitutes are the alternative to cars. These could be the public transport. Existing
competition is the various other companies who are operating in the sport or luxury car industry
like Mercedes Benz, Aston Martin, Porsche, BMW etc. New competition can be from existing
companies who started to develop luxury car market, this can be from Ford, Volkswagen etc. and
it can also be from the new companies (Bryman and Bell, 2015).
SWOT analysis can be done for the identification of the company's strategic position and
it outlines the four key areas that may be helpful and harmful for the objectives of the company.
These four areas are : Strengths : Strength of the Jaguar is in the renowned reputation of the company that is
created by producing top range of cars and also by maintaining the excellent staff.
Company also have strength in the area of R&D which allow to have competitive edge
over competition. Weaknesses : Jaguar is not the eco friendly company and this is having the negative
impact on the reputation of the company. Jaguar sell high end cars which they sell to a
smaller niche market and always miss to tap into market for the cheap alternatives (Zott
and Amit, 2010). Opportunities : Jaguar must continue to quality for the excellent reputation and also if
they want to maintain competitive edge in the existing and the new market. Jaguar should
continue the research and development as it have a excellent department of R&D, it will
help to improve the image regarding eco friendliness as it is very important for the car
industry . Jaguar can look to exploit the growth of the Chinese market (Wheelen and
Hunger, 2011).

 Threats : Jaguar's strategic position can be threatened by the global economic climate
because of increase in the prices of the fuel, less disposable income and the change in the
interest rate. Regulation of the government can also threaten Jaguar for instance stricter
emission regulation can cause company to have additional expenditure for the
improvement and up gradation of the products and services.
P6 Interrelation of strengths and weakness with external macro factors
The external macro factor of the company have relationship with the strengths and
weakness of the company. External factors of the company includes the organisation
environment that is operating in the environment, it includes the market, competitors and the
ecosystem. The strengths of the company will help in gaining these competitors and will also
help in the having opportunities. The market of the company includes all the customer who are
making use of the products and the services. The ecosystem consist of the social, economical,
political and the technological environment in which the company operates, this ecosystem can
consist of the various opportunities for the company that can be analysed with the help of
PESTLE analysis (Hamilton and Webster, 2015). Opportunities will help to find out change in
the market, change in the lifestyle of the customer, technology advancement and the will also
help in finding out new methods of products. Threats are such kind of external factors that are
beyond the control of the company and can make its presence in the supply chain , change in the
behaviour of the customers and the economic cycle.
PESTLE analysis support the macro environment of the mentioned organisation, it
consist of the political, economical, social, technological, legal and environmental factors that
affect the operations of the company in a positive or in a negative way. Government policies and
the regulation which will influence the business activities, they control and monitor the activities
of the business. Strategist should be aware of the legal issues and laws which will help in making
the strategies. Socio culture should also be analysed in the formulation of the business policies.
Technological factors helps in adopting new technologies (Kolk and Van Tulder, 2010).
SWOT analysis which consist of the strengths, weaknesses, opportunities and threats
influence the decision making of an organisation. By analysing the strengths company can win
over their competitors and can attract more customers. Analysis of the weakness will help in
analysing the where the company is lacking and can make decisions regarding that.
Opportunities will help in the identification of the things which will be helpful for a company,