Regent College: Business and Business Environment Analysis Report

This report provides a comprehensive analysis of the business environment, focusing on Tesco as a case study. It begins by exploring different organizational types, sizes, and scopes, differentiating between public, private, and voluntary sectors and their legal structures. The report then delves into the interrelationship of various organizational functions, such as finance, human resources, administration, customer service, and sales and marketing, and how these functions link to the overall objectives of the business. Furthermore, the report examines the positive and negative impacts of the macro-environment on business operations, utilizing the PESTEL analysis (Political, Economic, Social, Technological, Environmental, and Legal) to assess external factors influencing Tesco's performance. The report highlights the effects of economic changes, political instability, technological advancements, social trends, legal frameworks, and environmental concerns on the company's strategies and outcomes. Overall, the report offers a thorough understanding of the external and internal factors influencing business success, providing insights into how organizations can adapt and thrive in a dynamic environment.

Business and Business
Environment

INTRODUCTION
Business is the enterprise who deals commodities in exchange of monetary or non-
monetary whose goals are particular in order to achieve target for which they performed these
commercial activities. The companies who exchange the goods in non- monetary exchanges
often are non- profit oriented businesses (Teece, 2010). These could be managed by government
or some public or private owners. Those enterprise who owned by government are usually
government agencies.
In the market there are some elements in the business environment consisting customers,
suppliers, structure, demands, and employee who affect it in various that directly and indirectly
that can influence the decision and results of organisational activities in various way. In order to
analysis their impact on the objectives of company, a firm should perform micro and macro
environment study in order to understand the threats and weakness of company as well as
identifying the power and opportunity to grow in future.
This report will analyse the various organisational types, their nature, purpose, size and
scope. Tesco is an MNC Which trade its goods and services in more than 14 countries worldwide
(Business environment within different sectors of industry, 2015). The major purpose of this
study is the interrelation of macro and micro factors over each others and their impact on the
external and internal environment that helps an organisation in evolving in industry.
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TASK 1
P1 & P2
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TASK 2
P3 Relationship of different organisational functions and its link to objectives
Introduction
Tesco is a multinational retailing company which deal with wide variety of products and
services in All Europe and other countries which is one of the largest merchandising companies
in whole UK (Drucker, 2017). They aims to facilitates the commodities in more cheaper cost and
high quality to satisfy consumers.
Main Structure
Cited company vision to deploy their business in global trade providing high quality
products and cost effective prices to create more potential buyers for organisation (Osterwalder
and Pigneur, 2010). In order to complete their goals they work for the better market products
than the competitors as well as create an effective company image in the society through
utilizing various effective strategies and performing CSR. In the below picture, the major
functional structure of the respected organization is explained that which is interrelated with the
productivity and profitability of enterprise as it manage the entire entity in organised way.
Source 1: Different challenges faced by the Project Manager when working within the
alternative organisational structures used to implement projects, 2014
Finance
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Fund management is required for either large organisation or small business so as Tesco.
This is very essential function of an organization which administrate entire financial activities
include managing or allotting funds in different entity maintenance. The contain to major
individuals who manage the entire tasks i.e. accountants and manager. Accountants where mange
all information and data of whole activities occur in organisation and the expenditures as well as
measures profits and loss of specific practices to entire operations (Welford, 2013). Though, the
manage manage or deigns the plans of by making budget for a certain strategies by managing
funds and investments to create or increase economical conditions of company.
Relation
To accomplish set objectives of cited organization, Tesco need to a huge amount of fund
as the organisation is largest organisation. According to the leader of organisation it is the proper
management of financial department and funds of company which have led the company so far
and made them to achieve the objectives of a business. Management helps in controlling the
extra expenses as well as make efficient use of monitory of company through balancing them in
various operations.
Human Resource
It is significant resource which is required for the larger organization like Tesco. Plc to
manage in order to implement entire operations and execute strategies more effectively. This
functions administrate entire employee related activities including recruitment, selection,
promotion, determination of policies of companies and others (Wheelen and Hunger, 2011). It is
their duty to organise hiring process, recruit employee at best levels as well determining their
wages and other aspects. For that they design plans and coordinate various activities to motivate
them and resolve their conflicts related to organization or workplace issues.
Relation
Human resources are back bone of an organisation as it manage most of the operations
which leaders or manager plans top make the profit out of activities that lead to achievement of
objectives of company. By managing proper relation with worker, company agrees with the fact
that the main reason behind their success is their worker's hard efforts and performance
according to Dave Lewis, CEO of Tesco. Through satisfying consumer needs it helps in
accomplishing company vision and goals.
Administration
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It is all about the clerical work which an organisation required to record all data and
information of entire operations and activities which occur in Tesco. Plc. This is based on the
enterprise security, maintenance and management of operations.
Relation
This reduce them miscommunication issues which occur in cited company through
decoding them message properly as well as solving issues of customers by supplying facilities to
them. By this Tesco. Plc maintain and increment the sales insights which helps in attaining main
objectives of enterprise (Bryman and Bell, 2015). Management manages the work of activities
and document all records which organisation need to maintain, This is the only reason why
Tesco is maintain the sustainability in market and gaining new heights of success
Customer Service
An organization main motive is to satisfy consumers by providing effective services
including products as well as suggestion if required. This Dept. is related to the consumer and
their issues related to the products and services of cited company. It include customer services,
advising them in complex situation or resolving their conflicts with goods defaults etc.
Relation
Customer service Dept. help in attaining the objectives as well as satisfying the consumer
which increase the sales and consumer base of organisation. This functional are avail in market
expansion and raise probability of products and services. Thus it aides in meeting business
objectives. Tesco is famous for satisfied consumer and products of their interest which is
possible only with the help of consumer services department. Thus it have assisted in attaining
goals of business.
Sales and Marketing
Profit can be measured and maximized by the aggregate of sales amount of products that
company render (Carroll and Shabana, 2010). Marketing techniques is used for promotion and
implement the product either new or existing in market to influence consumer toward specific
commodity by the advertised message. Tesco. Plc use effective told of promotions and trading
aiming to the target consumer. An organisation required to follow its culture and policies while
creating any plans.
Relation
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Tesco. Plc use this method to increase their sales of commodities by analysing various
aspects of environment as well as statementing their consumer for coherent aims that helps them
portraying unique recognition and increment in profits amount. Sales and marketing techniques
have been able to meet the emotions and logical hemisphere through implementing effective
strategies and proper promotional activities. 1.3% of sales have been rise after proper
advertisements and marketing techniques within three month in last year.
Conclusion
The entire function is managed by the board of directors of an organisation who made
major decisions for developing company in regard of expansion geographically and
economically. Tesco. Plc have 11 member groups of Bod in which 7 are new members which are
replaced on the place of retired group. This is the higher authority of any large Plc so as Tesco
who create policies or company and commend the entire groups including manager and directors
in order to evolve the company as well as achieve its objectives.
Interrelation Between Functional Areas
These all functional areas are interdependent on each other such as sales required
marketing and the products and services production needs finance for the development and
proper promotional activities. This is how they all are interrelated for the development and
evolution of the enterprise.
Hence, these helps in achieving the objectives and goals of cited organization by
functioning in harmonious way. Each Dept. have same target or purpose which assist the
organization in meeting set aims through satisfying consumer which can only be done if all
function work in proper and systematic way.
TASK 3
P4 Positive and negative impacts of macro environment of business operations
Business is a open system which gather essential resource from external environment that
include supplier(raw materials for commodities production), consumer(monitory services),
government(funds and subsidies) and other factors (Cantwell, Dunning and Lundan, 2010).
These factors affects directly and indirectly on the production and supplying process as well and
entire system of a company. In order to identify these factors Tesco . Plc conduct research on
macro and micro environment spending quarter of its profits over it for understanding the
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strength and weaknesses of company ans well as the factors which impact ting cited enterprise
more positively and negatively.
To recognise the external factors, PESTEL analysis is done of Tesco. Plc:
Economical
UK's political and economical changes have occurred which have impacted the market
more negatively as the nation is suffering from economical issues. The GDP of Tesco. Plc have
been calculated approximately 2.7% which has noted in caparison of crisis. This may not affect
the the company sales directly as it have international deployment but most of benefit is depend
upon UK market which is 30%. After the crisis, purchasing power of consumer have been
decreased which have affected the company directly (Iskanius, Page and Anbuudayasankar,
2010).
Political
The political changes have occurred in United Kingdom which have mostly impact don
the company more negatively than positively. The country is facing some financial instability for
which state have changed taxation policies as well as introduced some new policies and
legislation which have affected the consumer purchasing habits which is frequently decreasing
the sales. Decrease in the sales activities have reduced the amount of profits that refer to less
development or might have a ,lot of debt, on Tesco. Plc.
To overcome from the crisis, UK government is cooperating with the large organisation
for providing jobs to the locals of country to reduce unemployment. This create an effect more
positively as Tesco is an third largest retailing company of UK own wide part of market share.
Technological
The digitization have catered the convenience in most of the systems including related to
consumer services or production, supplying or distribution procedure etc. Tesco. Plc is bringing
the advancement in the supply chain in order to attain competitive objectives. Company have
adopted more technologies first is online shopping home delivery services which is helping in
creating more consumer through providing them ease on buying and collecting goods.
Second profit which company is making by catering technical change is updating self
services checking system which is helpful as the customer don't need receptionist as well they
can make their own bills by makings purchase (Laumer, Eckhardt and Weitzel, 2010). Tesco.
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Plc have invested their more revenues in updating the system to modify the technologies to use it
more efficiently.
Social
According to the social changes, an organization require to vary their system or
production, goods quality as well as method of delivery. Tesco. Plc study the consumer needs
and expectation according which innovation is acquired in the cited company (Trkman, 2010).
Cited enterprise have determined to widen their services range including more food related
products to their consumer. As the people of UK is more informed about the health conflicts of
packaged food, they would concentrate over healthy procedure of manufacture of those goods.
Legal
Legal procedure directly impact the whole infrastructure of company as well as
management. Tesco. Plc provide wide range of services including bank loans, assets care, saving
and other offers to clients. In the financial filed, United Kingdom government have amended
some acts in which Financial services law 2012 largely impacted on the operations of cited
organization. Legislation's strictness and limitation have stress over the functioning of
enterprise.
Environmental
The elements of environment including wastage, pollution and recycle of squandered
products create a negative impact on environment. As UK public is now more concern about eco
system and its betterment to save nature, company required to go more eco-friendly to maintain
pollution. For managing these issues, Tesco. Plc is performing some CSR practices in their local
society to make the environment better (Boons and Lüdeke-Freund, 2013). Tesco have
announced to use and reduce carbon vestige by 50% by the end of 2019. For this, cited company
is increasing to use recyclable techniques and more ecological techniques in their framework.
TASK 4
P5 Internal and external analysis of Tesco Plc to identify strengths and weaknesses
Surroundings of company determines the growth and development levels as well as
shapes the organisation culture and products types according to its locality and consumer
expectation (Al-Debei and Avison, 2010). Thus, the factors which are situated in external and
internal environment influence the findings and outcome of operational activities. These
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elements not only affect the marketing and sales but influence each other. Here are few elements
which builds the strengths and weakness of an organisation:
Environmental Factors
In order to control the polluted gas emission, UK have developed some legislation rules
to control the environment pollution which create barrier in growth. But new developed
strategies of Tesco. Plc of reducing carbon footprint may prove effective (Briggs and Grisaffe,
2010).
Political Factors
The increased taxation policies which is amended after the economical instability is
decreasing the purchasing power of buyer which is considered as the weakness for Tesco. Plc.
To overcome for this, they need to design new strategies including pricing and NDP.
Technological Factors
The company is using more advanced technologies such as sale payment system which is
one of the strengths of company but the technologies are altered according time which can create
one of weakness of company (Ullah and Lai, 2011).
Social Factors
Population of United Kingdom is dominated by the elder citizens which is one of
weakness of organisation as they manufacture the more trendy and digitized products. But these
will increase one of strengths of cited company as their census of UK of under 18 is more who
like more digital and modifies technologies which Tesco. Plc manufacture.
Micro Environment
Consumer
Consumer are main body of a company that is reliable for the activities operating of
various functions and flow of finance and funds in company. Tesco is largest merchandising
enterprise companies that focus over the new target consumer as well as potential clients to make
a long commitment with them.
Suppliers
These are those people who render goods, raw materials, as well as finished products to
an organisation so as Tesco which is one of the most important element. Tesco has maintain
very effective relations with suppliers that has reduced the cost of their raw material which
indirectly increase the revenues and gross profit.
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Competitors
These people are able in building main weaknesses or limitation for a company that is
require to monitor and analyse all actions of rivals and competitors. Tesco is facing different
rival considering Aldi , Sainburry, Walmart so on the clients of enterprise is transforming their
potentiality.
On the respected factors the determination of upcoming strengths and weaknesses as well
as threats and opportunists is done which is explained as below:
Strength
The company have a good rand image in market which is noticed third largest retailing
brand in all UK (Adeoye and Elegunde, 2012). They provide cost effective prices and high
quality services to consumer. Tesco. Plc have a great financial condition among all competitors
including Asda, Sainsburry. They have developed more ecological techniques of performing
operations.
Weaknesses
Tesco. Plc have been demotivated and facing loss after the new policies of government
win which the taxation amount have been increased by government. They deal with wide range
of services including financial services, telecommunication, grocery, apparels and many other
which make the management process of company more fussy and complicated. Because of debt.
in finance, the company is dealing with major loss in market (Zott, Amit and Massa, 2011).
Opportunities
Open market system have carried the opportunities to develop or introduce Tesco in new
trade to deploy their business such as East Asia, S. Africa etc.
Online shopping system have catered a wide platform to exchange an deal with resected
products in various levels as well as helped in promotional activities.
Threats
Market is full of powerful rivals and competitors like Asda, Sainsburry producing and
deploying business in same field. Wal-mart who have a good positioning in market are giving
competition to cited organisation.
P6 Interrelation of strengths and weakness with external macro factors
The external and internal factors of organisation affect the major parts of its productivity
and profitability influencing the decisions making procedure as well as its main structure. Then
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macro factors helps in shaping views and opportunities that can help cited organisation in
developing their business in globally. These factors not only increase or decrease the revenues
but greatly impact in the strengths and weakness of organization which determines international
recognition of company.
Following are macro environment of enterprise that form strengths and weaknesses:
Economical Factors
Cited company have a powerful economical appearance in market which is creating a
positive image of company helping in competing the competitors. But the increasing debt. In
sector of Tesco finance is leading to loss which is one of weakness of company.
Political Factors
The political factors include new taxation policies is decreasing the growth of company
as well as on the other hand it is increasings strengths as government is dependent upon
organisation in regard of providing employment to their youth (Bocken and et. al., 2014).
Technological Factors
Technologies refer to the ease in delivering and manufacture of gods and services in
order to serve consumer. If company use advanced technologies like Tesco. Plc is using self
services billing system which is one of its strengths. If enterprise use traditional techniques they
will lead to decrease in amount of potential buyers.
Social Factors
The cited organisation is deploying their business in not only UK but other nations and
trade in regard of expansion. Social factors can affect negativity as well as positively. If
company produce the products according to the preferences and expectation of consumer or
community then it tend to create strengths and in violating production it become one of weakness
which might lead to crisis.
Legal Factor
The legal factors which government create or modify affect the growth of an organisation
in both ways. More favourable aspects build the organisation more powerful whereas those terms
which reduce development decrease the sales. UK have emerged some laws related to taxation
and environment which is not good for Tesco. Plc (Li, Lai and Wang, 2010).
Environmental Factor
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The public and government is more conscious about environment and nature and
deploying new policies and terms for managing the eco-system properly. Thus they are
developing the sector legislation related to it, which can impact the business more negatively
than positively, though, organisation have announce to be more environmentalist in production
or other procedure which can provide relief to the loss.
Micro Environment(SWOT Analysis)
Strength  Largest grocery retailing company
 Strong Financial condition
 Wide range of products and services
Weakness  Complex management process
 Strong competition
 Financial Loss
Opportunities  Globalisation and open market
 popularity rendered new development opportunities
 franchisee and expansions
Threat  Financial crisis on United Kingdom
 Competitors are emerging
Through these elements the organisation can maintain the growth and measure the effect
of strategies that can make the enterprise in sustaining in market. It have made the organisation
in achieving the success within a span of time.
CONCLUSION
From the following reported it can be concluded that there are various types of an
organisation in the industry with different structure, size, scope and purpose to run or function.
which affect the market. It also clears that organisation largely influenced by the factors of
internal and external environment which not only impact over their mission and objectives but
also influence the culture and vision of company. To identify the strengths and weakness as well
as threats and opportunities of business it is essential to understand these elements to develop or
expand the business. Micro and macro environment are interrelated upon each other which
influence the decisions of a company and increase and decrease the sustainability in market
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which influence the productivity and profitability of it. To manage the functioning of operations
of a corporation of any kind it is required to study these factors.
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REFERENCES
Books and Journals
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