Report: Business Environment and Organizational Structure Analysis

This report provides a comprehensive analysis of the business environment, focusing on different organizational types (public, private, and voluntary) and their respective structures, scopes, and objectives. It examines the operations of LIDL and British Petroleum (BP), including their vision and mission statements, organizational structures, and stakeholders. The report delves into the interrelationships between various organizational functions, such as marketing, operations, finance, and human resources, highlighting their impact on the overall business. Furthermore, it explores the advantages and disadvantages of these interrelations, along with the application of PESTLE and SWOT analyses to assess internal and external factors influencing decision-making. This report provides valuable insights into the complexities of business environments and organizational management.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
Activity 1 ........................................................................................................................................1
Different types and purposes of organisations.............................................................................1
Size and scope of different sizes of sectors.................................................................................2
Analyse how business size, scope and structure link with organization objectives. ..................3
Explain the relationship between different organizational function............................................4
Advantage and disadvantage of interrelations between organizational functions......................5
Critical analysis on Different type of business structure and interrelationships of different
organization function...................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business is activity of making money by buying or purchasing and selling services or
goods. Business environment is collection of all external and internal components such as
customers expectations and needs, clients, activities of government, social trends, economic
changes, supply and demand, etc. business environment is affected due to all these factors that
impact on overall functions and operation of firms (Bah and Fang, 2015). The present report is
based on three different types and aims of companies; public, private and voluntary and explain
their legal structures, size, scope, goals and business objectives.
It justifies structures, relationships between various organizational function of company
and link to organisational structure and objectives . This study explain disadvantages and
advantages of interrelations between organizational functions and its impact on organisational
structure. It justifies complexities of several types of business structures and also explains
PESTLE and SWOT analysis to identify or determine the external and internal factors impact on
company. Furthermore, influence of internal and external factors upon decision making
procedure of LIDL.
Activity 1
Different types and purposes of organisations
There are three different type of organisations which are operating with different
purposes. Three type of sectors are public, private and voluntary which can be explained below:
Public organisations: Public sectors are those sectors which are controlled by the government
which may include state, central and even local government of a country. Public sector includes
all the public companies or entities or public enterprises and services ( Nikolova, 2015). Such
companies form an important part of the country's economy which is controlled by the
government. Main purpose of public sector is to supply quality products to citizens, for example
British Petroleum is public sector, it is a Britain's multinational gas and oil company and is the
world's largest organisation due to its turnover.
Products: Products of British Petroleum includes petroleum, motor fuels, natural gas, motor
fuels and petrochemicals.
Legal Structure: BP is a public limited company which means that it can sell shares to general
public on the stock exchange. The decision power lies under the government and has to publish
its accounts in public.
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Voluntary Organisation: Voluntary sectors are run by group of people or unions of different
individuals who are interested in entering the agreement in order to achieve a particular objective
(Sugden, 2018). Its main purpose is to serve humanity for example Oxfam is a voluntary
company which is one of the largest non-profit organisation of UK.
Services: Main focus of voluntary sectors is to help people and to eradicate poverty and to
provide services related to it like charities, disaster relief etc.
Legal Structure: Being a charitable company, its decision making power lies under the director
of company.
Private organisation: These are such companies which are run or operated with a purpose of
making profits. A private organisation may be an association, any corporation, partnership or any
agency or any person which does not come under public body. For example LIDL Stuffing & Co
is a private company operating in retailing industry, which is German's global discount super
market chain.
Products: It is a discount store which offer retailing products on discount to its customers across
the world.
Legal Structure: LIDL is owned by Board of Directors which are mainly elected by
shareholders and it is headed by a Chairman Joseph Schwarz and each shareholder of LIDL has
got limited liability towards the debt of a company.
Size and scope of different sizes of sectors
LIDL
Size and scope: LIDL is a German's global discount super market chain which operates across
United States and Europe. There are more than 10,000 stores of LIDL and there more than
315,000 employees working across the world.
Vision Statement: To improve the life of customers by offering high quality products within
the market and ensuring the high level of customer satisfaction is first priority organisation does
(Vision and mission Statements, 2019.).
Mission Statement: To deliver high customer's satisfaction across the world.
Objectives:
 To ensure market leading value and quality through innovations
 To deliver high customer's satisfaction.
 To achieve long term success in retailing sector.
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Organisational Structure: LIDL follows a flat organisational structure which has got limited
levels in their management.
Stakeholders: LIDL's stakeholder includes customers, employees, shareholders, investors,
advertisers, etc.
Legal Structure: It includes Board of Directors who is responsible for taking decisions of the
company.
British Petroleum
Size and scope: BP is 6th largest gas and oil company by its market share in the world and is 12th
largest by its revenue. It operates in more than 70 nations and produces almost 3.6 million barrels
of oil in a day. There are more than 75,000 employees working in BP with more than 18.400
service stations across the world.
Vision Statement: To become world's number one competitive company of the world and to
improve the quality of its products and services.
Mission Statement: To display fundamental qualities like honesty, integrity, transparency with
providing respectful treatment to every customer and make effective contribution towards
humanity.
Objectives:
 To maximise the profitability of the company by 25%
 To improve the company image and its brand values which was affected by oil spills.
 To open more and more service stations across the world.
Organisational Structure: British Petroleum has also adopted flat organisational structure
though there are many complicated processes and activities performed by BP (BP Mission,
Vision & Values, 2019). It includes BOD, Management of executives, Exploration, production
and refining.
Stakeholders: It consists of government, public, employees, shareholders, etc.
Legal Structure: BP is entirely controlled by British government.
Analyse how business size, scope and structure link with organization objectives.
This business size scope and structure helps to business for achieving the goal because its
provide the best management in the business. This structure and scope is gives the idea that how
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to manage the production activity of the firm. So, basically it helps to achieving the goal of the
firm.
Basis Public (British
petroleum)
Private (LIDL) Voluntary (Oxfam)
Meaning Public sectors are
those sectors which
are controlled by the
government
These are such
companies which are
run or operated with a
purpose of making
profits
Voluntary sectors are
run by group of people
or unions of different
individuals who are
interested in entering
the agreement in order
to achieve a particular
objective
Size and scope BP is 6th largest gas
and oil company by its
market share in the
world and is 12th
largest by its revenue.
It operates in more
than 70 nations
This is super market
chain which operates
across united states and
Europe. There are
more than 10,000
stores
It is charitable
organization. Aim to
reduce the global
poverty. Firm provide
their services in all
over the world.
objective To achieve long term
success in retailing
sector
To improve the
company image and its
brand values which
was affected by oil
spills
Main objective to
reduce the poverty in
all over the world.
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Explain the relationship between different organizational function.
Organizational function is the process and set of activities which describe the different
departments and area of organization (Fabuš, 2017). These different function helps to manage all
the activity of business. There are different functions which includes operations, marketing,
human resources, information technology, customer service, finance and warehousing. Etc. This
department manage all the activities of the firm and the organizational function mange each
department of the LIDL.
 Marketing department — Marketing departments is interrelated with finance
departments because finance department gives the funds to marketing department for
establish the new strategies and plan within the organization. Marketing departments is
one of the essential department of the LIDL. Thus, marketing departmnts follow the
fuctional structure in their team to accomplish the task. This structure is good because the
function has full control in the team Therefore, the marketing departments of the LIDL
can follow the strategies to complete the particular task of the department. This mainly
interrelate with distribution department because Marketing is done through different
promotion activities which increase the sales of the goods and serrvices. Therfore, the
main obejective is increase the sales volume by using the different promotional and
pricing strategies. Marketing departmement makes strategies to promote product and
services. They may desingn plan and makes promotional strategies andalso they identify
the target market by the use of different model such as STP.
 Operational and production departments — Operational and production departments
of the LIDL is interrelated with marketing departments because this both department
have one objective that is increase the profitability of the firm. Therefore, Production and
operational department follow the division structure they distribute their work according
to the ability of employees, and then they achieve the objective of the firm. Therefore,
operational and production departments is interrelated with marketing departments
because marketing departments gives the ideas to the department that how to produce a
product and which type of product customer want (Eling and Schaper, 2017). Therefore,
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production departments work according to the marketing department, and they focus on
achieving the objectives and goals of the LIDL. The main objective is that they enhance
the demad of the product by produce the high qulity of produt according to the
requiremnt of the customer. Opretional department of Lidl manage the production
activity and do work according to the budget.
 Finance department — Finance department is one of the most important department of
the LIDL because this departmnts is gives the funds to the different department for
opereate all business activity of the firm. Therfore, This department is interrelated with
human resource departments because without enough funds human resource departments
not work properly because they are not conduct the interview facility. Therefore,
marketing department also interrelate with Finance department because without enough
funds marketing department also not perform their work accordingly they also not
implement the strategies in the firm and also the promotional activities is much
expensive, so they need the funds. Therefore, Finance department follow strategic
business units structure because this structure is mainly concerned with big organization.
So, LIDL also follow this strucuture. The main aim of finance departmn is manage the
capital of the firm by making the different finanacial statments.
 Human resources department — This department is also one of the most important
department of the LIDL which describe that every department of the firm needs
employees for complete the particular task of the department. Therefore, every function
of LIDL needs to employees for enhance production in each department whether it is
production, marketing and operation Therefore, this department follow the matrix and
functional structure to achieve the particular task of the firm. The main objective of this
department is managed the people at work place by providing tanning and other facilities.
This department hire the best people that helps to achieve the objective of the firm. HR
department hire and recruit the employees' for the suitable job and also they organize the
development program to improve the skills and knowledge among the employees.
Advantage and disadvantage of interrelations between organizational functions
Organizational function is plays a important role in the bsuiness because this structure is
provide the better management at work place.
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Advantages
 Incrase the prformace of employees by managing all the activities of the firm (Eling, and
Schaper, 2017).
 The functional organizational structure provide the help to achieving the benefits of
specialization of work. Therefore, the employees of the lidl perform their work according
to knoweledge and ability.
 It helps to enhance the prforemce of the firm. The organiztional structure provide the
scope of business expansion.
Disadvantages -
 This process is leads the compexitity in the work
 This process is also delay in decision making beacuse it is very big process.
Critical analysis on Different type of business structure and interrelationships of different
organization function.
As per the view Dutta and Dutta, (2019) stated that marketing department is interrelated
with the production department as marketing expertise of LIDL do market research in which they
analysis the current demand & choices of the consumers and on the basis of collected data and
facts they inform production department of the company. The manufacturing department of the
enterprise do production of their goods on the basis of current trends and preferences of the
consumers. This leads to increase customer satisfaction in the company.
As per the view Bah and Fang, (2015) stated that finance department is interlinked with
the marketing department. Finance expertise ask the marketing department about overall
expenditure of the promotional activities and on the basis of that they set projected budgeted
costs. As the advertising cost is generally high. Thus, they contact to the finance department for
the arrangement of the funds. Human resource department is interlinked with the marketing
department. They ask the marketing expertise that how many people they need for doing
promotional activities in the LIDL. HR department of the company hire skill level of workforce
for accomplishing the promotional tasks of the company . Thus, this lead firm towards
profitability.
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Business structure and organizational function interrelate to each other. Therefore, the
departments of the LIDL mange their according to the structure. For example, human resource
department follows the functional and matrix structure to mange their according to the structure.
CONCLUSION
From the above report it has been summarised that business environmnt is a total of
external and internal factors, both this factor is affecting business. They can be forces of
economic, social political and technological factors.
Hence, report is based on business environment of LIDL. Hence, The project report has
been descibed the different types of organisations structure and its purpose and legal structure.
Furthermore, the Report has been explained the size and scope of different types of
organisations. Moreover, The report has been described the Relationship between different
organisational functions and there interrelationship with organisational objectives and structure.
The report has been descibed the positive and negative impacts of macro environment on LIDL
operations. Furthermore, report has been explained the SWOT analysis. Lastly, the report has
been described the interrelationship of strengths and weakness.
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REFERENCES
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Dutta, S. and Dutta, C.S. 2019. Green business opening and its significance in the present
climate change scenario-a study.ZENITH International Journal of Multidisciplinary
Research. 9(4). pp.171-183.
Eling, M. and Schaper, P. 2017. Under pressure: how the business environment affects
productivity and efficiency of European life insurance companies. European Journal of
Operational Research.258(3). pp.1082-1094.
Fabuš, M. 2017. Current development of business environment in Slovakia and Czech
Republic.Entrepreneurship and Sustainability Issues. 5(1). pp.127-137.
Gaganis, C., Pasiouras, F. and Voulgari, F. 2019. Culture, business environment and SMEs'
profitability: Evidence from European Countries.Economic Modelling, 78, pp.275-292.
Hillary, R. ed. 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Prajogo, D.I. 2016. The strategic fit between innovation strategies and business environment in
delivering business performance.International Journal of Production Economics,171,
pp.241-249.
Nikolova, M., 2015. Government funding of private voluntary organizations: is there a
crowding-out effect?. Nonprofit and Voluntary Sector Quarterly. 44(3). pp.487-509.
Sugden, R., 2018. Voluntary organisations and the welfare state. In Privatisation and the welfare
state. (pp. 70-89). Routledge.
Online
Vision and mission Statements. 2019. [Online]. Available through :
<https://www.lidl.co.uk/en/Vision-and-Mission-Statement-13338.htm>
BP Mission, Vision & Values. 2019. [Online]. Available through :
<https://www.comparably.com/companies/bp/mission>
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