Exploring Business Environments: A Case Study of Tesco, NHS, and Oxfam

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BUSINESS AND BUSINESS ENVIRONMENT

Table of Contents
INTRODUCTION............................................................................................................................. 3
P1: EXPLAINING DIFFERENT TYPES AND PURPOSES OF ORGANISATIONS.....................................4
P2 & M1 ANALYSIS OF SIZE, STRUCTURE AND SCOPE OF DIFFERENT ORGANISATIONS................7
P3 EXPLAINATION ABOUT RELATIONSHIP BETWEEN DIFFERENT FUNCTIONS OF ORGANISATIONS
....................................................................................................................................................... 9
P4 & M3 APPLICATION OF PESTLE ANALYSIS ON THE GIVEN ORGANISATION.............................11
P5 & M4 CONDUCTION OF SWOT ANALYSIS AND ITS INFLUENCE ON DECISION MAKING..........14
P6 INTERRELATION BETWEEN INTERNAL AND EXTERNAL FACTORS............................................17
CONCLUSION............................................................................................................................... 18
REFERENCES.................................................................................................................................19
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List of Figures
Figure 1: Logos of NHS, Tesco, Oxham...........................................................................................3
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INTRODUCTION
There has been a tremendous increase in awareness among the customers related to the
market and all the business associated with it. It includes all the internal and external factors
such as customers, management, employees, supply and demand and business regulations. On
studying the business environment of a company, it would be easy to identify various forces
which would help in enhancing the sustainability of the given organization in a significant
manner. In the given study, the National Health Service (NHS) has been chosen as a public
sector enterprise, Tesco has been chosen as a private enterprise and Oxfam has been chosen as
a voluntary enterprise.
The given study would focus on the size, scope and types of the given organization and would
explain the interrelationship between different functions and how they link to the
organizational culture. Furthermore, the positive and negative influence of the macro
environment on their business operation would be effectively considered. At last their internal
strengths and weaknesses would be assessed and compared with the external factors
effectively.
Figure 1: Logos of NHS, Tesco, Oxham
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P1: EXPLAINING DIFFERENT TYPES AND PURPOSES OF ORGANISATIONS
In the modern international market, there are various kinds of business present so as to fulfil
the needs and requirements of the customers in an effective manner. These are public, private
and voluntary sectors. These all are explained below:
PRIVATE SECTOR
These are those organizations where most of the shares are provided from the private entities
and they have a sole power to govern all the business operations associated with their chain of
command. They also act as a sole legal authority and all the jurisdiction is conducted within
their legal domicile (Knopf, 2015). Tesco is the leading UK based retail industry which provides a
wide range of services such as grocery, financial, telecom and insurance. They also have the
provision of online delivery service which provides products to the customers in an effective
manner. There are various purposes of private organizations and are as follows:
 To achieve profitability
 To grow and expand the business in an effective manner
 To enhance significant share in the market
 To maximize revenue and sales (Butler and Wilson, 2015)
PUBLIC SECTOR
These are those organizations where the products and services have a span of control by the
government and are used for the welfare of the people. In the UK, NHS is one such organization
which is the largest healthcare sector whole over the country. It comes under the Department
of the Health of the UK and all the funds are provided to it from the taxes collected by the
government. It provides employment to 1.4 million people and provides free services to all
people covering critical and non-critical health facilities. Charges are applied only for a few
cases such as eye care services and dental treatment (National Health Services, 2018).
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The major aims of public organizations such as the NHS are as follows:
 Protection of the rights of the individual
 Provision of free medical services to all people
 Maintenance of social order
 To participate in economic decisions
 To provide protection to national security (Carlson, 2017)
VOLUNTARY SECTOR
These organizations are those organizations which are governed and run by the grant providers
as well as those persons who are involved in charitable trusts. All the people and group are
having the same interest and are considered as the volunteers and are part of this sector. In the
given study, Oxfam charity has been taken as a voluntary sector which works for the poor
people and aims to remove the global poverty and provide those people with a source of
livelihood (Jones, 2011).
 There are various purposes of the voluntary sector which are as follows:
 To either fund for charitable programs or to raise money for them
 To provide valuable services to the deprived and downtrodden people
 To create awareness about any health-related issues among the public (Butler and
Wilson, 2015)
LEGAL STRUCTURES
The legal or business structure is the procedure to effectively manage and run a business by the
authorities in a significant manner. There are various types of legal structures which are
explained below:
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Sole Trader
In this structure, the business is run by a single person and there is no involvement of the group
of person. They have full control over the business and are responsible for all the profit and
losses associated with the business. It includes restaurants, coffee stalls and bakery.
Advantages
 An easy and inexpensive form of business structure
 Less time consuming
Disadvantages
 Difficult in people management
 Faces financial problems (Cohen, 2017)
Partnership
In this business, two or more than two people are involved and work together to start a
business effectively.
Advantages
 They are financially sound
 They have clear legal status
 Good management activities
 Starting the business is easy
Disadvantages
 They are unstable in nature
 The raising of capital is difficult
 There is a case of frequent occurrence of conflict between the partners (Das and
Rangarajan, 2017)
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P2 & M1 ANALYSIS OF SIZE, STRUCTURE AND SCOPE OF DIFFERENT
ORGANISATIONS
Indicator NHS Tesco Oxfam
Background It is a public sector
healthcare institution
run by the UK
Government for
providing free
services to all the
legal citizens of the
UK.
It is the largest
private retail industry
of the UK which has a
wide range of services
available for its
customers.
It is one of the leading
charitable trust which
focuses on the
removal of global
poverty.
Size and Scope It is the largest
healthcare
organisation in the
world with a high
scope of its operation.
It is one of the largest
retail sectors in the
UK with the provision
of employment to a
large number of
people. It has wide
scope by expanding
its market and
delivers a strong long-
term growth.
It is a confederation
of 20 independent
charitable
organisation and has
a wide scope across
the world.
Organizational and
Legal Structure
It is the single public
healthcare service
provider which caters
for an unincorporated
organizational
structure in the form
of tall hierarchy
where the Board of
Trustees is
responsible for all the
operations. The legal
structure of NHS is to
govern the employed
clinicians and how the
patients are referred
for treatment and
flow of funds within
the department
It has a flat
hierarchical
organizational
structure which has a
Board of Directors. It
also has a legal
structure of corporate
governance which is
essential for the
company to achieve
its objectives as set by
its shareholders. So
its legal structure us
corporation
It has a two-tier
governance structure
where an Executive
Board and Board of
Supervisors handle all
its operations. The
executive board
regularly updates the
supervisor about their
operation and
informs them about
any significant matter
affecting their
interests. Its legal
structure is a limited
liability
Vision and Mission Its mission and vision
is to provide a
The vision of the
Tesco is to provide
Its mission is to
address the main
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healthy and
independent living to
the individual
(National Health
Services, 2018)
more focus on the
customers and its
employees in a
significant manner. Its
mission is to create a
customer value so as
to earn their loyalty
for a lifetime.
cause of poverty and
enhance the
effectiveness of the
local accountable
organisations. Its
vision is to ensure :
 The right of
sustainable
livelihood
 Right to life
and security
 The right of an
identity
 Right to access
basic social
services
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P3 EXPLAINATION ABOUT RELATIONSHIP BETWEEN DIFFERENT FUNCTIONS OF
ORGANISATIONS
There are various departments which come under the organizational and business structure
and include marketing, Human Resource (HR), finance, operations and so on. These
departments form a specific structure in the business and work with each other so as to
accomplish the business objectives and perform their own functions in an effective manner.
Departments and their role
Marketing Department
This is an important department whose major function is to promote the business and provide
a platform for the occurrence of selling and purchasing of the products in an effective manner.
The major aim of the marketing department is to reach out to the customers, investors, legal
prospects and other people and thus create a brand image of the company.
Finance Department
It is another important department whose function is to prepare a budget which would be
allocated to a different department in a significant manner. Furthermore, it also keeps a vigil on
the various business deal done so as to check how much funds would be required to run it in an
appropriate manner (Knopf, 2015).
HR Department
The role of the HR department is to conduct the recruitment and selection of capable and
suitable employees so that they would help the business to reach a new height. In addition to
this, they also act as a bridge between employees and management and help in improving
employee relations. Furthermore, they also conduct training and development programs to
enhance the skills and personality of the employees and also try to solve their issues through
effective grievance procedure (Goetsch and Davis, 2014).
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Operational Department
This department helps in the proper administration of the practices associated with the given
business so as to enhance the efficiency of the organization and create good products for them.
This department is concerned with converting the labour and materials into finished goods and
services so as to increase the profit ratio to a higher extent (CSCMP and Sanders, 2014).
INTERRELATIONSHIP BETWEEN DIFFERENT DEPARTMENTS
All the departments in every organization are directly connected to each other and could not
perform well of one department breaks down. There are various examples which are explained
below:
The marketing department depends on the HR department which provide them with capable
employees so that they could perform their marketing functions in an effective manner. On the
other hand, the HR department is dependent on the marketing department for providing the
requirements for vacancies which could be fulfilled by the selection of suitable candidates.
Another example can be considered as the operational department is aiming to design product
and services that are based on the marketing information which is provided by the marketing
department. And then the operations department converts the design into products within
financial constraints for the financial department.
Financial department is dependent on all the departments as it could not define a suitable
budget without getting valuable feedback from these departments. On the other hand, all the
other departments have a great dependency on the financial department as it allocates funds
so that they could perform their task in an effective manner (Goetsch and Davis, 2014).
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P4 & M3 APPLICATION OF PESTLE ANALYSIS ON THE GIVEN ORGANISATION
In order to analyse the macro environmental factors of any organisation, Tesco in this case,
PESTLE would be utilized as it would help to evaluate the positive as well as negative impact on
the organisation at any circumstances. This tool is explained below:
Political
As Tesco is a global company, many political factors at the global level affect its working and
provide a significant influence on it. Various factors such as political stability, tax rates and
legislation acts affect its efficiency. The stable political environment in the UK has enhanced the
growth of the company as it has been able to perform its work in a better manner, not only in
the UK but also globally. However, the recent adoption of new tax measures by the UK
Government and an increase in VAT rate has affected its sales revenue and in turn its profit
(Price and Moore, 2018).
Economic
The Brexit has negatively affected the economy of the UK in 2016. This in turn also affected the
companies such as Tesco to sustain in its business in a significant manner. However, the recent
trends have revealed that the country has come out of the financial crisis and have shown
tremendous growth in the economy which is a positive sign for the company such as Tesco. This
is because high economic growth would increase the spending power of the people and would
allow them to spend more on the purchasing of goods. In addition to this, good economic
stability has allowed Tesco to pursue diversification and internationalization policies so as to
achieve success in this front (Hamilton and Webster, 2018).
Social
There have been significant changes in the trends in consumer shopping as they now demand
fast delivery of the good quality of the products. Furthermore, the demand for goods and
services has increased manifold and there is a requirement of those products which are
sustainable and easily available. So, Tesco has provided its online services for fast delivery of its
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