Business and Business Environment: An Analysis of Sainsbury's

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BUSINESS AND BUSINESS
ENVIRONMENT
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Table of Contents
LIST OF FIGURES.......................................................................................................................3
INTRODUCTION........................................................................................................................4
OVERVIEW OF THE COMPANY..................................................................................................4
ESSAY........................................................................................................................................5
1. TYPES OF ORGANIZATIONS............................................................................................5
2. SIZE AND SCOPE............................................................................................................ 7
3. ORGANIZATIONAL STRUCTURE AND FUNCTIONS..........................................................9
CASE STUDY............................................................................................................................13
1. PESTLE ANALYSIS.........................................................................................................13
2. SWOT ANALYSIS...........................................................................................................14
3. PORTER’S FIVE FORCE MODEL.....................................................................................16
CONCLUSION.......................................................................................................................... 18
REFERENCES........................................................................................................................... 19
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LIST OF FIGURES
Figure 1 Hierarchical structure.................................................................................................9
Figure 2 Flat structure............................................................................................................ 10
Figure 3 Network structure....................................................................................................10
Figure 4 Porter’s Five Force Model.........................................................................................16
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INTRODUCTION
Business environment is said to be a collection of all external and internal factors like
customer’s expectations and needs, employees, demand and supply, management,
suppliers, clients, owners, government activities, economic changes, social trends,
innovation in technology, market trends, etc. which affects the purposes of the companies
directly or indirectly for which the companies works effectively and efficiently for earning
more profit and increasing their presence in the market (Erasmus et al., 2016).
This assignment carries 2 parts by including essay and case study based on the business and
business environment which impact the businesses. This will reflect several organizational
types with their scope, size, products and purpose. The discussion of this assignment will be
based on selected organizations of the UK and the selected organizations are private, public
and voluntary. In the next part, this assignment will highlight the pestle analysis of the
company and further will discuss the SWOT analysis of the selected company.
OVERVIEW OF THE COMPANY
Sainsbury’s is a retail supermarket and has the largest chain in the UK which was founded in
1869 in Holborn, London, by John James Sainsbury. The company serves its products like
food and grocery items in the UK and has many distributors all over the world as this
company does not have any physical evidence in other countries except the UK (Sainsbury,
2019).
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ESSAY
1. TYPES OF ORGANIZATIONS
There are many types of organizations which are working in the business environment by
having different purposes and objectives linked with their products and services which they
offer. The types of organizations are:
PUBLIC ORGANIZATIONS: these organizations are established for providing products which
are highly affordable in prices to the public. The public organizations are governed and
owned by the government or any individual or group and at someplace these are alike
voluntary organizations. For example, Sainsbury’s is a public limited company in the UK
(Bouckaert et al., 2016).
Overview: Sainsbury is a supermarket and a public ltd company in the UK. It is one of the
biggest retailing industries which serve its services and products in many countries.
Products: the company serves online and offline services to its customers and the products
offer by the company are groceries and convenience goods (Bouckaert et al., 2016).
Purpose: their purpose is to provide quality food and other items at a fair price as well as
trade fairly with their suppliers and safeguard the environment (Bouckaert et al., 2016).
PRIVATE ORGANIZATIONS: these organizations are established for providing quality services
to the public and are goal-oriented by increasing their productivity and profit. The private
organizations are not under control of the government as these are owned by a person, in
partnership or agency privately. For example, Greenergy is a private company in the UK
(Gorman, 2019).
Overview: The Greenery Company is a British company which supplies petrol and diesel in
the area of the United Kingdom, Canada, Ireland and Brazil for motor vehicles (Gorman,
2019).
Products: Greenergy offers products like diesel and petrol fuel products for vehicles.
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Purpose: their purpose is to sell their products in the UK and become the topmost company
of producing fuel with aiming to earn more profit (Gorman, 2019).
VOLUNTARY ORGANIZATIONS: these organizations are like the public organizations which
provide benefits to the public to satisfy them. The voluntary organizations are coming under
charity sectors where they work for the public for their benefit and development. For
example, Oxfam is a voluntary company in the UK (Maier et al., 2016).
Overview: Oxfam is an independent charitable company which works all over the world by
providing many facilities to the helpless people which was founded in England.
Services: Oxfam offers assistance to the people for seeking their effectiveness to provide
benefit and human rights (Maier et al., 2016).
Purpose: their purpose is providing the justices to economic and gender to the people for
their effective development and growth (Maier et al., 2016).
Difference Basis Public organization Private organization Voluntary organization
Proprietorship These are owned by
the government or
an individual.
These are owned
privately or by an
individual
These are owned by a
community or a group
of people.
Purpose Making a profit Making a profit Societal welfare
Services/Products Affordable products
and services to the
customers
(Bouckaert et al.,
2016).
Products and services
depend on the
choices of the people
(Gorman, 2019).
They provide services
for the development
and growth of people
(Maier et al., 2016).
Example Sainsbury’s Greenergy Oxfam
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2. SIZE AND SCOPE
There are various organizations which work on diverse scales and presented in the
businesses are as follows:
Basis Micro/small Medium Large
Objectives Their objective is to
earn profit for basic
requirements.
Their objective is to
maximize profit by
increasing sales.
Their objective is to
expand business all
over the world.
Market share The market share for
these organizations
is specific to a
particular region.
The market share for
these organizations
covers the national
market (Zhou, 2016).
The market share of
these organizations
covers national and
international market.
Profit share The share of profit is
limited to an extent
but it has added to
the UK economy is
£3.1 million.
The share of profit is
25% equal to the
small businesses
contribution (Zhou,
2016).
The share of profit is
up to 48% of the UK
turnover. Their profit
is less than small
businesses.
Growth and
sustainability
The growth of these
businesses is
sustainable and 90%
of the profit
generated for the
economy is from
agriculture and
forestry sector
(Zhou, 2016).
The growth and
sustainability are
high of which
depends on the
areas of market
share they are
having which uplift
or down lift the
economy of the UK.
The growth and
sustainability are less
than micro and small
businesses but these
businesses make
balanced
employment in the
economy of the UK
(Zhou, 2016).
Microbusinesses: the micro-businesses are the businesses which are based on less than 10
members. These businesses are having the growth ration up to 95% and are owned and
operated by an individual. These businesses help the UK economy in order to motivate
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others for starting their business individually for their as well as the economy's growth and
sustainability (Berisha et al., 2015).
Small businesses: the small businesses are the businesses which are the backbone of the UK
economy as they provided many opportunities for the local people of the UK by increasing
the employment by providing benefit and growth to the economy of the UK. These
businesses get runs for earning more profit for fulfilling their needs (Berisha et al., 2015).
Medium businesses: the medium businesses are the businesses which commence business
to maximize their profit by increasing sales by providing satisfaction to the customers. These
businesses have more than 100 and less than 1000 employees which cover the national
market of the UK (Berisha et al., 2015).
Large businesses: the large businesses are the businesses who aim to expand their business
into a large area over the world. These businesses have more than 1000 employees who
work for increasing the presence of the company in the economy which helps directly and
indirectly in expanding their business worldwide (Berisha et al., 2015).
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3. ORGANIZATIONAL STRUCTURE AND FUNCTIONS
Some of the types of structures of organizational culture which are found in organizations
depend upon their size and scope of the operations. Following are the structures:
1. Hierarchical structure: This is the well-known kind of the hierarchical structure
which is followed in the greater part of the organizations where a legitimate
progression of requests and communication is being pursued. There is one clear
manager who gives reasonable orders to the sub-ordinates and hierarchy is pursued.
The degree of unpredictability prevails in this structure yet it very little confusing
when contrasted with network structure (Lee et al., 2015).
Figure 1 Hierarchical structure
(Source Lee et al., 2015)
2. Flat structure: This is the structure of the organization which is followed in the
majority of the small companies like start-ups organizations, for the most part, this
kind of structure is followed in the beginning period of the organizations. The
middle-level administration is liable for this type of organizational structure. The
degree of unpredictability is extremely less as the middle-level administration
follows a flat structure (Pontefract, 2016).
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Figure 2 Flat structure
(Source Pontefract, 2016)
3. Network Structure: This kind of network is found in numerous organizations the
greater part of the I.T organizations has this sort of organizational structure. There is
a less progressive system in this kind of structure and it is increasingly decentralized
in nature this makes it progressively adaptable. Utilizing this kind of system structure
results is a high difficulty as there is fast communication among the employees which
prompts uncertainty (Cumming, 2016).
Figure 3 Network structure
(Source Cumming, 2016)
COMPLEXITIES IN INTERNATIONAL, TRANSNATIONAL AND GLOBAL ORGANIZATION
1. International business: The organizations which are into an international market are
forcefully into the exports and imports of the items. They don't go into direct selling
of the items and services in the worldwide market. The level of complexity in such a
worldwide business is extremely high (Felin et al., 2016).
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2. Transnational business: The transnational business works in each market whether it
is a national market, international market or universal market. The transnational
business emphasizes the co-appointment of the activities of the local market and
pursues complex techniques to put resources into the outside market (Felin et al.,
2016).
3. Global business: These businesses formalize various sorts of procedures to work in
each nation of the world. The entire world is a commercial place for such businesses.
The management has the authority of taking the decision associated with the
venture, customization, gatherings and so on (Felin et al., 2016).
ORGANIZATIONAL FUNCTIONS
1. Marketing: this department of Sainsbury’s is liable to make the decisions related to
the sales and profit for the company. The main focus of this department is on
increasing sales by making the sales team of the company effective and takes all the
opportunities prevailing in the market (Kirova, 2017).
2. Human resource: this department of Sainsbury's is liable to hire an effective
workforce for the other departments of the company in order to provide profit to
the company. This is also responsible for providing benefits and salaries to the
employees of the company (Ingham and Ulrich, 2016).
3. Finance: This department of Sainsbury's is liable to take the decisions for the funds
of the company and dividing the funds and resources based on the need of the
departments for gaining the objectives (Anderson, 2018).
4. Operations: this department of Sainsbury’s is liable for giving additionally
customization of items and services to the local clients and customers as well as to
the neighbouring nations for expanding the business (Alves et al., 2015).
ADVANTAGES
 Sainsbury’s follow the divisional structure for providing satisfying services to their
customers by the departments (Anderson, 2018)
 This helps in handling the company efficiently and build confidence and trust in
between the employees (Ingham and Ulrich, 2016).
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DISADVANTAGES
 The functional departments of Sainsbury's follow the divisional structure where they
inform their particular managers about their daily workings (Ingham and Ulrich,
2016)
 This impact on the efficiency and effectiveness of the company
Conclusion
The organizational functions and structures of Sainsbury are assisted in the attainment of its
mission and objectives. The company is a retail industry with having many functions which
get performed worldwide.
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