Business and Business Environment Report: Organisational Analysis, UK

This report provides a comprehensive analysis of the business environment, focusing on Asda, a UK-based retail company. It begins by exploring different organizational types, including public, private, and voluntary sectors, detailing their purposes, legal structures, and stakeholders, with specific examples such as NICE, Asda, and Oxfam. The report then examines the size and scope of these organizations, linking them to their business objectives. It delves into the relationships among organizational functions, using Asda as an example and illustrating various organizational structures like wheel, matrix, and divisional structures. The report further analyzes the impacts of the macro environment on businesses, applying the PESTLE model to Asda. It concludes with internal and external analysis, including a SWOT analysis, and evaluates the impacts of macro and micro factors on business objectives and decision-making. The report highlights the interrelation between strengths and weaknesses with external macro factors, providing a detailed understanding of the business environment.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Organisational types with purposes, legal structure as well as stakeholders.........................1
P2. Size and scope of different organisations..............................................................................3
M1. Structure, size addition to scope of organisations linked with business objectives............4
TASK 2............................................................................................................................................5
P3. Relationship among organisational functions........................................................................5
M2. Advantages together with disadvantages of interrelationships among functions of
organisation..................................................................................................................................7
D1. Analysis of complexities.......................................................................................................7
TASK 3............................................................................................................................................8
P4. Impacts of macro environment..............................................................................................8
M3. Application of PESTLE model...........................................................................................11
TASK 4..........................................................................................................................................11
P5.Internal and external analysis...............................................................................................11
P6. Interrelation of strengths and weaknesses with external macro factors..............................12
M4. Application of SWOT analysis...........................................................................................14
D2. Evaluation of impacts of macro and micro factors on business objectives and decision
making........................................................................................................................................15
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Business environment comprises of an individual, organisation addition to other forces
that are controllable or uncontrollable by business enterprises (Ambler, Witzel and Xi, 2016).
Such environment constitutes economic conditions, technologies, suppliers, trends, media,
market conditions, consumer groups together with multiple other institutions. All these presents
opportunities including threats for the business. It helps in dealing with ongoing changes, tapping
useful resources, improving performances and assists in planning for future. This report is based
on Asda which is located at Leeds, England, United Kingdom. Such company performs its key
operations in retail industry. The report further discusses about different organisational types
along with structure, size, scope addition to stakeholders. It also discusses about relationship
among organisational functions along with their linkage to structure and objectives of
organisation. It also includes internal addition to external analysis along with interrelation
between strength and weaknesses with macro factors.
TASK 1
P1. Organisational types with purposes, legal structure as well as stakeholders.
Organisations are the groups addition to structure that were set as well as managed by an
individual with the aim to achieve certain objectives. In the competitive world, there are
numerous types of organisations which performs activities to maximise profits. Organisations are
categorised into different types having distinct size and scope. The categorisation are the
following:
Public sector organisations: Companies that are controlled and accountable to local or
central government authorities are termed as public sector organisations. Range of public sector
organisations are British Army, NICE, Crown Prosecution service and so on that perform
numerous activities across UK (Becker, 2018). The selected organisation among all is NICE
which is National Institute for Health and Care Excellence located at London, United Kingdom.
It publishes guidelines for health technologies, medicines, clinical practices and social care
services.
Purpose: Purpose of public sector organisations is to redistribute income along with
wealth in all regions or sectors, provide capital formation sources, developing infrastructure
facilities and attaining planned resource allocation. Purpose for the existence of NICE is to
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provide guidances and advices, setting quality standards together with managing database to
make improvements in health along with social care systems.
Legal Structure: Legal structure within public sector organisation comprises of public
corporations, local government and central government. From the all, managers of NICE
proceeds operations with central government structure.
Stakeholders: Stakeholders that are part of public sector organisation are financial
institutions, employees, government and so on. Key stakeholders of NICE are local authority,
trustees, investors and employees.
Private sector organisations: Such organisations are launched, managed, controlled
together with run by single person or majority of individuals (Brown, 2018). They generates
profits through delivering goods at better prices as well as quality other than competitors. In
context to report, Asda, Sainsbury's, Caterpillar, Tesco, John Lewis and Apple are some of the
range of business working as private sector organisation across UK. Among all, Asda is
selected. Such company is a private entity that performs activities to supply grocery items.
Purpose: The main purpose of existence of private sector organisation is to survive and
grow in order to maximise profits and attain satisfaction. Core purpose of Asda existence is to
cater great services at fair prices to enhance customer satisfaction along with maximising
revenues by delivering demanded products by targetted audiences on appropriate time.
Legal structure: In context to private organisation sector, it includes legal structure such
as private limited company, corporate structure and unincorporated structure. Hence,
management of Asda follows corporate legal structure.
Stakeholders: Key stakeholders of selected organisation are customers, investors,
shareholders, local community, suppliers and so on. Stakeholders of Asda are local community,
distributors, regulatory authority, owners, shareholders and hence forth.
Voluntary organisations: Not for profit entities and non governmental businesses are
part of voluntary organisations. Such associations comprises variety of institutions such as
charitable, religious, educational, healthcare, advocacy, recreational and satellite organisations.
Wide range of voluntary organisations within UK are British Heart Foundation, National Trust,
Oxfam and many more. In relevance with present scenario, Oxfam is chosen (Cullen, 2017).
Such entity is federation of more than 20 charitable organisations that emphasis on global
poverty alleviation.
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Purpose: Main purpose of voluntary organisation is concerned with social welfare
addition to social development. Purpose of such organisation is to create solutions for poverty
injustice as well as raising monetary funds so that essential service are delivered to public
together with society for development purposes. The purpose behind Oxfam working are to
empower society members so that they are capable to tackle poverty issues through social
services.
Legal structure: Voluntary organisation involves legal structure of unincorporated
associations, charitable incorporated organisations, trust and limited by guarantee. Management
authorities of Oxfam are following trust legal structure.
Stakeholders: Stakeholders of voluntary organisations are funders and donors, media,
organisational partners, professional associations, staff, regulators, supporters, and many more.
Key stakeholders of Oxfam are communities, carers, service users, interested groups, trustees
and so on.
P2. Size and scope of different organisations.
In the competing world, distinct organisations run businesses with the motive to attain
great heights. Different organisations posses distinct sizes and accordingly set procedures or
plans to reach towards objectives. In context to present report, three organisations together with
scope and size are as mentioned:
Public organisation (NICE)
Size: NICE has hired large employee size which consists of more than 600 personnels
working across England along with Northern Ireland, Wales and Scotland to deliver services that
results in increasing customer satisfaction (Size of NICE. 2019). They offers services related with
health, education, social care and many more.
Scope: Such organisation has scope for operations expansion by adopting digitalisation
techniques to cater faster services to people living within and outside the national boundaries. It
provides services across globe.
Objectives: The objectives of NICE is to eliminate discrimination by building strong
relations. The company has other objective to provide healthy guidances to general public by
creating more values through recognizing innovations.
Private organisation (Asda)
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Size: Asda has size of 32 super centres, 33 living stores, 61 Gateway Supermarket, 341
superstores, 319 petrol filling stations, few pilot George stores, 209 supermarkets and many more
where approx 165000 employees are performing distinct operations to deliver products such as
clothing, home wares, electronics, beauty products and toys together with services related to
financial services (Size of Asda. 2019).
Scope: Management team hires skilled and unskilled individuals those who have
capability to perform activities as well as learning new things by using advanced techniques
which expands business scope to perform activities globally. It provides services related with
delivery and financial services.
Objectives: Core objectives of Asda is to satisfy customer expectations for grocery items
together with non grocery items. It aims to provide products and services in affordable prices so
to attract new audiences while retaining existing ones.
Voluntary organisation (Oxfam)
Size: Oxfam has opened diverse shops including 650 speciality shops related with bridal
wear, books, music, furniture and many more that has more than 10000 items and are managed
by approx 23000 volunteers across the world (Size of Oxfam. 2018).
Scope: Such company renders humanitarian services in around 14 nations. It can expand
the scope through adding new service or products in their wide locations that can expand
satisfaction of potential customers. It provides services in order to reduce poverty addition to
saving people from disastrous conditions.
Objectives: Objective of Oxfam is to eradicate discriminations between poor or rich
individuals together with supplying safeguard global services.
M1. Structure, size addition to scope of organisations linked with business objectives.
In context to public organisations, the business objective of NICE is to deliver guidances,
helping to attain quality and sustainable services as well as contributing towards thriving science
industry. Such objective was set after considering available employee size which is enormous
that helps in researching market and investing money so to set big targets and attain them
effectively. In context to private organisation, Asda being a large private organisation with
diverse range of employees, products, services and scope which follows divisional along with
functional structure by communicating all informations to serve international customers,
managers set objectives accordingly and attain them effectively. In context to voluntary
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organisation, Oxfam objective is to organise civil societies, empowering women, safeguarding
food supplies, reducing poverty together with injustice. By having huge shops, they provide
employment opportunities and empowering women so to attain objectives. Hence, having vast
scope, structure together with large size employees helps an organisation to formulate massive
size with diverse scope, otherwise small sized organisations with limited objectives are build.
TASK 2
P3. Relationship among organisational functions.
Organisations functions consists of main activities which are performed by personnels in
different areas. Distinct types of functions are finance, market research, managing human
resource, customer relationship management, operation management and many more.
Organisational structures are changed with changes in market conditions, distribution channels,
competitors actions and so on. Asda is a retailer organisation which plans objectives addition to
utilising structures that are interrelated with various functions of the company (Organizational
chart. 2019). Three organisational structures are as described below:
Illustration 1: Organisational chart. 2019
(Source: Organisational chart. 2019)
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Wheel structure: It is simple organisational structure which is used by start up
companies. In such structure, the managers have all powers to take decisions and all the activities
are organised around owner of the company. It benefits the owner by controlling growth along
with development of business. But the limitations of such structure is that it is appropriate till
certain size only as well as owner may not posses specialist knowledge in context to different
functions.
Matrix structure: Such structure combines distinct function or departments with project
teams in which employees work across projects in teams within their won functional areas. It
benefits in decentralising decision making authority, increases managerial motivation,
complexities are controlled and people with similar skills are put under one project. But such
structure is difficult to implement, comprises of high conflict level along with high overhead
costs (Hamilton and Webster, 2018).
Divisional structure: Under this structure, organisational functions are divided into
divisions that are corresponded to product or geographical areas to deliver demanded range of
products. It benefits top level management to concentrate on long term plans by spreading profits
across products, markets as well as divisions but it is difficult to coordinate all divisions and
results in conflicts among divisions on the basis of resource allocation and many more.
Managers of Asda follows distinct structures at different stores or other locations as per
the convenience of managers. For instance, in some stores, divisional organisational structure is
followed where as at some places matrix organisational structure is followed due to the
convenience as well as adaptability of employees to work in team or divisions.
Interrelationship of functions of Asda with linkage to objectives addition to structure as as
mentioned:
Marketing function with human resource function: Marketing function frames
strategies as well as plans to promote brand image in the multinational market. They analyses
market situations related with customer demands, prevalent trends and accordingly
communicates information to other department. Marketing function of Asda organises activities
with the help of human resource function. Human resources collects information related with
demands of customer and accordingly plans activities that are to be performed. Marketing
department coordinated activities with human resource department so to attain the objectives in
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effective manner. Activities related with marketing function are closely linked with structure and
objective or organisation in numerous ways such as they cater directions to perform actions.
Operation function with marketing function: Operation function comprises of
warehouses, distribution, production and packaging. Such function of Asda is related with
supervising, and redesigning operations so that production activities are carried out in smooth
manner without any barriers. Such function of Asda collects information related with demand or
supply of goods and synchronise undertakings with marketing function (Hillary,2017). All the
activities are set by considering structure as well as objectives so that activities are performed to
attain them.
M2. Advantages together with disadvantages of interrelationships among functions of
organisation.
Organisational structure plays important character at workplace as such structure is used
to make critical decisions through exchanging thoughts, views addition to information.
Functional interrelationship benefits managers of Asda to assist activities by maintaining
cooperation, up surges associations, escalate profit level and increases business effectiveness that
results in impacting in positive aspects on business structure. One of the disadvantage of such
relationship is that there are chances or risks associated with sharing of confidential information
by employees to competitors. Some employees for their own benefit builds trusted relationships
with other functions and shares confidential information through informal communication that
results in negative impacts as employees can use such information in wrong ways which can
impacts on serious manner on business structure (Lloyd-Jones and Lewis, 2017).
D1. Analysis of complexities.
The management of Asda have embraced different structures at different workplaces. For
instance, in functional structure, distinct functional groups faces complexities while
communicating and grabbing attention of international market which diminishes performance
flexibility this causes complexities related with miscommunication as well as misconduct of
operations between functions such as marketing and human resource. While considering
divisional structure, employees faces complexities associated with operational inefficiency
among particular functions like marketing function in which they fails to communicate specific
information to operation function or which enhances implications on marketing practices.
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TASK 3
P4. Impacts of macro environment.
Asda is among the leading retail company that deals in general merchandise, grocery
together with delivering financial services. Business environment comprises of macro addition to
micro elements or factors that impacts on functions or operations of the company. Micro factors
are controlled by managers and exists within organisational boundaries. It includes customers,
values, suppliers, competitors, new entrants and substitutes. In contrary, macro factors are
outside the control of management team and includes political, social, technological, economical,
legal and environmental factors. The detailed description of PESTLE is as follows:
Political factors: It comprises of government stability, competition regulation, funding
grants, government policy and competition regulations. In context to UK, there is stability in
political system and such authorities enforces laws considering health, safety and employment
levels. All political factors affects organisational working in numerous manners.
Positive impacts: UK is a stable country in which policies remains consistent through out
the year that assists Asda to control its operational costs, source raw materials along with
improving profitability. Operating the business in consistent environment impacts in positive
manner as Asda can effectively manage all business operations by following predetermined
political policies.
Negative impacts: Asda is popular for planning corporate social responsibility initiative
but due to lack of clarity of such concept by UK government in context to energy efficient
schemes, government may put some actions against Asda that can affect its decision making
elankavil, 2015).
Economic factors: Such type of factor involves credit crunch, exchange rates, inflation,
growth and disposable income. UK's economy is highly developed addition with market
oriented. Economic factors are strongly considered by Asda managers at the time of determining
investment values together with business portfolio. Asda is highly affected by its pricing
strategies due to changes in economic cycle. Due to this, managers are not able to attract
customers.
Positive impacts: The management of Asda provides various various discounts on main
prices on online shopping that attracts numerous customers and impacts on sales and profits in
positive manner.
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Negative impacts: In various locations across the nation, due to changes in economic
cycle, managers of Asda faces inflations in which prices of organisational products rises along
with higher borrowing costs for the business. It impacts in increasing borrowings and
investments that reduces profit margin and increases risk related with lending money that
influence business decisions.
Social factors: These factors includes population age profile, attitude to work,
disposable income and education level. In the present time period, population of UK prefers to
shop products available under single roof. Managers of Asda emphasis on factors related with
ethnic customs, family preferences and economical status so to target potential audiences. They
manufactures products by considering present trends in market together with customer
preferences.
Positive impacts: Asda operates various activities in international market and accordingly
manufactures products as per different cultures that favourably impacts on sales together with
productivity and influences decision making in positive manner by satisfying customers demands
(Neubauer and Lank, 2016).
Negative impacts: Customers are sensitive in nature as they changes their perceptions
very frequently and needs all products as per their economic status. If Asda delivers products at
higher rates against rates perceived by consumer then it can influence sales as well as image that
can impact in changing its decisions also.
Technological factors: This factor comprises of digital methods, technological
developments, research spendings and technological innovations. The UK market is achieving
success due to technological factors and is planning to build digital technological business.
Information technology team of Asda time to time make updation in their technology and adopts
latest technologies in order to perform all operations in consistent ways. The trending
technological trends in UK are artificial intelligence and search engine optimisation pertaining
in technological environment.
Positive impacts: By adopting new advancements together with technological innovations
such as search engine optimisation, the IT team helps Asda to communicate informations so that
all business operations are performed smoothly which positively impacts on building
relationships and grabbing opportunities to expand the business in competitive market.
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Negative impacts: Regular adoption and frequently changing technologies adds
additional costs which impacts on margins of profit in negative manner. Adoption of new
technology such as artificial intelligence will require huge costs and can lower the profit margin
of Asda together with impacting on business operations of the company as it becomes very
difficult for employees to understand the technology and accept its workings.
Legal factors: It involves rules and regulations, securities together with legislations. UK
being a constitutional monarch where common law systems are followed and legislations are
passed or governed based on case laws. All such laws governed by such monarch are mandatory
to be followed by all companies. In UK there are changes frequent changes in the legislations as
to protect health and safety of the society. Asda managers carefully understand the reason of the
implementation of primary laws and follows them to attain beneficiary results (Pounder, 2015).
Positive impacts: Asda managers properly follows laws related with packaging and
labelling so to reduce health issues as well as provides products with proper packaging and
labelling all ingredients on the cover of goods that helps in gaining governmental recognitions,
grants and securities that impacts in enhancing efficiencies in business operations in positive
manner.
Negative impacts: If the managers of Asda breaks laws or does not follow the governed
acts to protect societal environment then they have to face issues such as penalties or
cancellation of licences that may hamper their sustainability and decision making in negative
manner.
Environmental factors: It is a combination of environmental protection laws together
with eco friendly environment. Asda managers focuses on all such factors and provides organic
food along with keeping workplace and surrounding localities clean through reducing wastages.
Positive impacts: Asda managers have taken initiative actions towards reducing,
recycling as well as reusing concepts that impacts in reducing carbon footprints along with
wastages that results in positive impacts to perform business operations as well as receive
recognition in international market.
Negative impacts: Few environmental factors like non compliance of standards laid by
legal authorities adds additional costs for financial department of Asda which impacts in adding
additional costs and managing sales level in negative manner. If such organisation does not
perform business operations as per such standards then they have to face negative consequences.
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