Business Environment Analysis: TESCO, Toyota, and Red Cross Society

This report provides a comprehensive analysis of the business environment, focusing on three distinct organizations: TESCO, Toyota Motor Manufacturing, and the Red Cross Society. It delves into the different types and purposes of organizations, categorizing them as public, private, and voluntary sectors. The report examines the size and scope of each organization, highlighting their operational structures, product lines, and global presence. Furthermore, it explores the interrelationship between various organizational functions, such as production, operations, and human resources, emphasizing their coordinated efforts to achieve overall business objectives. The impact of the macro environment on business operations is assessed, including both positive and negative influences. The report also conducts an internal and external analysis, utilizing SWOT analysis to identify strengths, weaknesses, opportunities, and threats, along with an examination of the interrelation between internal factors and external macro factors. Through this detailed analysis, the report offers valuable insights into the dynamics of the business environment and the strategic considerations for these diverse organizations.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Different types and purposes of organisations.......................................................................3
P2. Size and Scope of different types of organisations...............................................................5
TASK 2............................................................................................................................................7
P3 Relationship between different organizational functions......................................................7
TASK 3............................................................................................................................................8
P4 Positive and negative impact of Macro environment on Business operations.......................8
TASK 4..........................................................................................................................................11
P5 Internal and external analysis with strength and weakness.................................................11
Strength and weakness of company can be find through SWOT analysis................................11
P6 Inter-relation of strengths and weakness with external macro factors.................................11
REFERENCES .............................................................................................................................13

INTRODUCTION
Business environment could be defined as amalgamation of various internal and external
factors like individuals, government, entities and others that have a greater impact on company's
profitability and sustainability in long term. In today's era where there is frequent changes in
market dynamics it is of vital importance for a firm to regularly scans its business environment
so as to formulate necessary plans, policies and strategies to be able to manage or to be avoid the
impact of market uncertainties and threats (Crane and Matten, 2016). Analysis of business
environment also enables a company to look out for prevailing market opportunities, taste and
preferences of its customers, competitors tactics and other vital information that will contribute
in modifying its existing product or to innovate a new one so that it can fulfil customers demand
and will generate higher returns for business.
This assignment discuss about TESCO which is a public company is one of the third
largest retailer in the world dealing in groceries and general merchandise. Toyota motor
manufacturing which is a public limited automobile firm and Red Cross Society which is a
voluntary charitable organization set up for providing social benefits for under privileged people.
Project discuss about different types of organization and their purpose. Further it will
explain about the scope and size of different organization and interrelationship of them with
various function of business operations.
TASK 1
P1 Different types and purposes of organisations
A business firm during its establishment needs to take important decision regarding
setting up its specific purpose which describes its vision, mission and goal statement and serves
as a motivational force to achieve them for its overall prosperity and success. A firm is set up to
fulfil various economic, social and basic requisites and on the basis of level of government
interference and profit earning motive can be divided into public, private and voluntary
organizations. Mentioned below are the major three sectors :-
Public Sector: Public limited firms are those that are managed by government for their
citizens, however its ownership is dispersed among general public and many investors in form of

shares which serves as source of raising funds and capital (Gharajedaghi, 2011). These
organization works under the supervision of government and has a well defined organizational
structure, policies and guidelines. It provides goods and services as per needs and wants of the
general public at reasonable prices regardless of income or wealth generation. It involves large
workforce to handle its operations thereby proving to one of the major sources of employment.
For instance TESCO is the world's second largest grocery retail chain in UK providing
affordable and quality goods and services to its consumers (Gilboy, 2016).
Purpose: The main aim of setting up a public limited company is to contribute I the
economic growth and development of a nation by adopting a holistic approach for benefiting its
people by providing opportunities for employment, helping people belonging to below poverty
line or from other backward classes to get basic necessities of life and other similar social
benefits.
Private Sector: These are the companies that are self owned and managed under the
guidelines that are been incorporate as law but are free to set up their own vision mission,
structure and objectives. Public companies sales their shares to consumers but not to public
transfer of those is restricted to members only. For example Toyota motor manufacturing is
private motor manufacturing firm that provides vehicle manufacturing and assembling services
to consumers. It was founded in 1989 with its headquarters base in Burnaston, Derbysgire,
England. It has a team of more than 3,800 proficient employees handling its operations (Kian
Chong and et. l., 2011).
Purpose: The main objective of a private limited firm is to earn higher profits by
identifying the needs and aspirations of its target market group and provide them quality
products and services as per their specifications so as to attain higher market share and higher
revenues with customer satisfaction.
Voluntary Sector:- Voluntary organisation is created by group of volunteers who are
having some common purpose and interests and are inclined towards redressing some social
issues for providing benefit and welfare to the society and to enrich life of its members. They
work on no profit objective and the funds for carrying out the activities of firm is generally raise
by its members themselves. Other sources of finance of firm includes donations,
charity ,government aids etc. One such voluntary organization is Red Cross Society which is a
charitable trust established for providing relief and other emergency aid to the poor,

underprivileged and vulnerable people at times of emergencies and disasters (Li and et. al.,
2011). It was established in 1870 with main objective of providing support and to serve people
around the globe without discriminating against them on basis of religion, caste, ethnic beliefs
or nationality. It has a staff of more than 3500 and over 32,500 volunteers society which
supports its operation contributing in its mission to mobilise power of humanity so that people
can be prepared to deal with and recover from crisis.
Purpose:- Main purpose of these firms is to increase awareness among people about
human rights and enhance their living standard and education level.
Legal structure of the sector
Private sector:- It is divided into two categories:- Sole proprietorship:- It is the business that is owned and managed by an individual ,
responsible for formulating and handling all policies, process and to profits and to earn
profits and bear all losses (López-Gamero, Molina-Azorín and Claver-Cortés, 2011 ). Partnership:- It is an association or joint venture between two or more people wherein
they agreed to sign partnership deed specifying their profit sharing and capital ratios
along with time duration of a company.
Public sector:- Mentioned below are government bodies covered under this:- Central government:- It forms the central system for administration regulating activities
of both state and local government. State government:- Firm under state intervention are abide by all legislations enforced by
government.
 Local government:- Local government mainly deals in providing products and services
for society benefit in addition to working for social welfare of people.
P2. Size and Scope of different types of organisations
The organization in general are segregated on basis of number of people required to
carry out and manage its operations, its scope which is determined as description of firms size
and activities that consists of various locations here in company is running its operations, its
mission and vision. Size and scope of TESCO, TOYOTA and Red Cross Society are mentioned
below:-
TESCO: TESCO is a British multinational retailer dealing in grocery and other general
commodities like electronics, furniture, clothing, books etc. TESCO is known as a brand offering

value for money, convenience and a large variety of products (Meiners, Ringleb and Edwards,
2012). It is a public limited company.
Size: TESCO offers a wide range of products and groceries to its customers. It is the third
largest retail brand in the world in terms of profit generation and ninth largest retailer in terms
of revenue. It has around 6784 stores across globe and a team of 4,76,000 employees who are
handling its business in more than 12 countries across world. The main objective of TESCO is
to provide quality products at affordable prices to its customers.
Scope: TESCO deals in a wide variety of products and services. It product line ranges
from food, noon-food, medicines, home appliances, clothing range and many more all at
affordable prices (Sekaran and Bougie, 2011). It has maintained its dominance in UK market as a
brand with good quality and trustworthy products. With emerging digitalization era, TESCO has
efficiently adopted online marketing tools for providing personalized services to its customers.
Vision: Vision statement of the TESCO is “To be the most highly valued business by: the
customers we serve, the communities in which we operate, our loyal and committed colleagues
and of course, our shareholders”.
Mission: “We make what matters better, together”.
TOYOTA Motor Manufacturing: Toyota motor manufacturing is a private company dealing in
vehicle manufacturing with its base in Derbyshire, UK. It is considered as the largest auto maker
company in the world. The company is engaged in providing all ranges of cars starting from mini
vehicles to big trucks.
Size: Being the top brand in automobile company it manages a team of 316000
employees around the world handling its 522 subsidiaries. It is famous for its high quality and
latest technology auto mobiles. It also provides financial services through its other division
Toyota Financial Services and also indulge in building of robots for different industries.
Scope: Toyota Motor Manufacturing is one of the largest conglomerates in the world.
Apart from vehicle manufacturing which includes various processes such as welding, painting,
stamping, plastic moulding and assembling, it also carry out various other activities. For
instance, firm in partnership with other organizations like Rapid Electronics organises Toyota
Technology Challenge, national engineering and technology competitions to recognize and
provide platform to upcoming talent at secondary school level (Tayur, Ganeshan and Magazine,
2012).

Vision: “To be the most successful and respected car company in the globe.”
Mission : “To sustain profitable growth by providing the best customer experience and
dealer support. To attain and attract customers with high value products and services and the
most satisfied experience.”
Red Cross Society:
Size:British Red Cross is a type of non-profitable organization in the United Kingdom. This
society was founded in 1870 by Mike Adamson. In the business approximately 32,500
employees are work and perform with the motive to provide better and effective services to the
society.
Scope:Scope of the company is world famous that help the individual who survive from different
decease. It is a humanitarian business that renders , disaster relief, emergency assistance and
disaster preparedness teaching in the US (Türetken and et. al., 2011).
Vision: “A world in which sufficient competent and committed personnel are available and
responding to humanitarian needs”.
Mission: “We relieve suffering caused by disasters by selecting, training and providing
competent and committed personnel to humanitarian programmes worldwide”.
TASK 2
P3 Relationship between different organizational functions
. TESCO is a top international retail supermarket brand dealing in groceries and general
merchandise. It a public limited firm which has diversified its operations both geographically as
well as in terms of its product line as it provides variety of commodities ranging from clothes to
developing software, to food items, furniture and so on. Thus, it has different departments that
are well coordinated functionally towards one direction to enhance customer's satisfaction level
by providing them goods an services as per their requirements leading to TESCO generating
higher revenues and large sales volumes. Each of its departments comprising HR, production,
operations and others have their own assigned targets to achieved which they undertake by
working together in interrelation with other departments so that work efficiency and over all,
objectives of TESCO could be achieved on time (,Vaiman, Sigurjonsson and Davidsson, 2011).
Production and operation: This department is linked with manufacturing of products.
The manufacture unit provides firm with the desired quality and quantity of goods capable of
satisfying consumers needs. This unit works in interdependence with other functional units like

HR which provides them with the required quality ,quantity of raw material, latest machinery
and other requisite that are essential for manufacturing a product.
Human resource department: It forms the backbone of a business as it undertakes on of
the most important task of hiring, controlling employees, to design compensation and benefits
policies for them and formulating various other strategies related to training and development,
holidays etc. and works towards maintaining amiable relationship with it workforce so that they
can work with best abilities to reaches firms objectives. It helps other departments like
marketing division by providing them with proficient and most appropriate employees with
required capabilities to handle customers queries and doubts and assist them by providing viable
solutions.
Research and development: R&D department assists plays a critical role in the success
of a firm as it provides complete market related research comprising customers desires, needs,
target markets etc. This helps a firm to modify its existing product or to introduce an entire new
product thereby helping firm to a maintain an edge over its rivals. R&D units works with close
association with finance department which provides necessary funds to it for conducting
research process through interviews, surveys and other tools and techniques for information
gathering (Wack, 2017).
TASK 3
P4 Positive and negative impact of Macro environment on Business operations
Business organisation is prone to various external factors which influences its
profitability and productivity. Therefore it is essential for managers of TESCO to be updated
about recent market scenario. As external factors are beyond the control of a firm, hence it is of
vital importance to be proactive in formulating plans beforehand to successfully deal or to avoid
market uncertainness and threats. For analysing its macro environment company uses PESTEL,
and SWOT Analysis to predict positive and negative effect on business operations. Mentioned
below are the PESTLE Analysis of TESCO: Political factors: It includes all rules, regulations, policies that are formulated and
enforced by government. TESCO being a global retail brand are subject to many political
issues and factors like tax policy, labour acts, political stability and many more than if

now analysed and efficiently managed can greatly impact its performance and
sustainability.
Positive effect- TESCO by carefully considering legislation of a particular country can make
necessary changes in its strategies and operations so as to avoid any legal complications
Negative effect- In case of any changes in existing policies related to tax, labour etc. company
requires immediate alteration in its channel of distribution, product price which is quiet difficult.
Also in case it fails to do so company might have to pay heavy fines to government
 Economical factor: Economic factors comprises components related to inflation
wages, ,growth rate,salaries, etc. followed by a particular nation. TESCO in order to
maintains its market position and share requires to be aware about inflation rate, interest
rate,foreign exchange rate etc. so that it can mange its finance efficiently (Yu and
Ramanathan, 2013).
Positive effect- TESCO can diversify its operations successfully by studying all economic
factors and offering products at best prices to customers according to prevailing economic
condition to earn profits and maximise sales .
Negative effect- In case of inflation phase in economy,demand of products will be decrease due
to downfall in customers purchasing power. Social factors: It is related to corporate social responsibility which every firm should
fulfil so as to built positive brand image. TESCO to fulfil its CSR has consequently
increased the no of its non food items and also organises various activities to show their
concern towards society and its people.
Positive activity- Various public activities organised by company benefits its to know about
customers preferences thereby implementing that knowledge to make necessary alterations in
their manufacturing strategies to produce goods as per customer needs.
Negative effect- In case company fails to cope up with customers expectations or there is
probable harm caused to society from its operations, it will be reflected upon TESCO's
profitability and sales volumes.
 Technological factor: Technology forms a important component to maintain and
enhance its market share and to gain competitive advantage over its business rivals by
providing new and innovative products by utilizing latest technology in its production,
designing and other operations. With digitalization, TESCO has also launched its online

portals to provide its customers with a facility to shop from home by ordering online
(Zeng, Li,and Duan, 2012).
Positive effect- TESCO by utilizing latest technology in its manufacturing unit is able to provide
various facilities to its customers like online shopping portals that will help company to reach out
mass audience and increase its market share.
Negative effect- Falling to introduce necessary technological advancement company will loose
its clients as its products will be outdated both in terms of designs and quality which will be
rejected by its customers.
 Environmental Factor: TESCO complying with its CSR policies is working to make
use of latest technology that will help in reducing carbon emission from its plants as well
as to reduce and finding ways to reuse waste generated from its stores.
Positive effect: Company will be in saver side both from legal point of view as well it
will enhance its image as environment friendly company.
Negative effect-: Technology involved in reducing carbon emission is quiet expensive
requiring heavy investment to be made by TESCO.
Legal factors: TESCO is required to follow all the rules, regulation, policies, procedures
specified by the government of particular nation in order to carry out its business activities
smoothly and to avoid any problems in future.
Positive effect: TESCO has to provide wages according to National Minimum Wage act
and abide to provide safe and healthy working environment in accordance to Health and Safety
Act to its employees (Zsambok and Klein, 2014).
Negative effect : If it do not follow Govt. rules and can change price without informing
them then Govt. can ban company to produce goods and it can hamper operations of Tesco.
TASK 4
P5 Internal and external analysis with strength and weakness
Strength and weakness of company can be find through SWOT analysis
SWOT Analysis
STRENGTH
 Third largest British global retail firm
 Providing high quality products at
WEAKNESSES
 Dissatisfaction among employees due
to poor working conditions

affordable prices.
 Provide online shopping services
 Company charged of fraud due to
misrepresentation profits.
OPPORTUNITIES
 Require to explore other emerging
economies
 Require to intensive its sales promotion
and advertising
THREAT
TESCO is subject to threat caused due to
currency inflation
Increase interest rates and government taxes
Intensive competition in UK market
P6 Inter-relation of strengths and weakness with external macro factors.
Business is affected by various external factors that are required to be analysed in order
to reap positive outcomes. Inter relation of macro environment with strengths and weakness
discussed in detail below :
Political- Any changes occur ng in the political set up or stability of a nation are likely to
affect business and its operations. This is because TESCO requires to take several permission
from government related to infrastructure, project set up and so on. Strengths- TESCO being a global company needs to make necessary changes in its
strategies, company policies and operations depending upon the regulation, laws and
rules that are laid don by government of particular nation.
 Weaknesses- Recently TESCO fails to abide by the recent tax policies introduced by
government causing heavy to them.
Economical- TESCO is required to study all sources funds available with the company to
select most appropriate source of fund generation. Strengths- UK economy having growth potential serves as a great opportunity for
expansion of its business and capture large market share. Weaknesses- At the time of recession, TESCO was greatly impacted because of the
recession prevailing in 2011 in UK economy due to which company has to crunch its
structure by employees lay off.

Social- TESCO is a multinational retail firm which aims at providing good quality
products at recessional price to its customers thereby contributing in enhancing living standards
of people in society. Also it organize several events and activities for its customers. Strengths- To cater the needs of all society people belo9nging to different religion,age ,
demography TESCO keeps on introducing necessary alteration in its policies. For
instance,it introduced introduce Halal meat for their Muslim customers.
 Weaknesses- TESCO although introduce its online service to provide facility to shop
from home however there are certain products that are high priced online in comparison
to their MRP.
Technological- Technology advancement is readily accepted by TESCO as it introduced
latest technology in its process so as to improve quality of products and services and to reduce
production time. However this could negatively impact workers performance as they require
proper training to handle new machinery. Strengths- TESCO like introducing online shopping website keeps on is implementing
new and advance technology to maintain their position in market.
 Weaknesses- They are required to provide necessary training and development program
as well as to be attentive for disruptive technology that keeps on emerging frequently in
retailing.