Business and the Business Environment Report - McLaren Analysis

This report provides a comprehensive analysis of the business environment, encompassing private, public, and voluntary sectors. It delves into the purpose and types of organizations, exploring their structures and objectives. The report examines the connections between various business functions within an organization, using McLaren Technology Group as a case study to illustrate these relationships. Furthermore, it analyzes the impact of the macro environment, utilizing PESTEL analysis to assess political, economic, social, technological, environmental, and legal factors affecting business operations. The report also evaluates the strengths and weaknesses of McLaren, correlating these with the external business environment. Overall, the report offers a detailed overview of the business landscape and provides insights into the complexities of organizational structures and environmental influences.

Business and The
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Purpose and Type of organisation..........................................................................................1
P2 Size, scope and different type of businesses..........................................................................3
TASK 2............................................................................................................................................5
P3 Connections between various functions of business organisations.......................................5
TASK 3............................................................................................................................................6
P4 Affirmative and counter impact of macro environment upon business operations...............6
TASK 4............................................................................................................................................8
P5 Analysis of strength and weaknesses of McLaren ................................................................8
P6 Correlation of strength and weakness with external environment of business......................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
People of organisation, employees, employers, leadership, management and departments
are responsible to build an image of business. Business environment is an endowment of these
factors. When all these factors work together for a specific purpose then there is an environment
creates which keep align these factors together (Agarwal, Grassl and Pahl, 2012). There are
different kind of organisation and enterprises work in business environment as public sector,
private sector or private sector. This report describes these type of organisations. How business
functions relate with different departments of an organisation and external factors impact the
culture of organisation. This concept is defines as per private and public sector perspective.
TASK 1
P1 Purpose and Type of organisation
Organisation are made for specific purpose and goals. They work around their set targets
and plans. Making profits and generating income is the the main objective of business
organisations. There are some organisations which operate their activities for public awareness
and social health and care. Organisations are found in multiple forms and simulation as
partnership, joint venture, separate entity etc. their motive and objective depends upon there
work criteria and scope. There are different type of organisation are discussed as under :
Private sector : This is the type of organisation which works for its people and operates its
business functions for generating revenues and profits. These organisation remains focused upon
its aims and objectives and utilise there profits in growth of the organisation (Aterido, Hallward-
Driemeier and Pagés, 2011). McLaren technology of group, Dell computers, Best ways are the
examples of successful private organisations of UK. There capital size and market share remains
petite in respect of government organisations. Company's board of directors, managers and head
of departments control the operations of organisation.
Purpose: Making higher profits and generating income with effective deliverables is the main
objective of private organisation. These organisations enrich the status of people by providing
quality services and products to customers. Enlarging the scope and making business position
strong in competitive environment is also there primary objective.
Legal Structure :
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Public sector : These type of organisations works at large scale in UK. There market share,
capital size and scope remains high in comparison of other business organisations. Government
authorities, local bodies operates the functions of public sector organisation. All over control
remains in the hands of government. These organisation also plays important role in growth of
nation and economy. It invites candidates and employees at large level and provide employment
conditions (Auzair, 2011). Their profit and revenues are invested in public interest, large
government projects and development plans. These organisations not only works for it people
but also support in building economical structure of nation strong. UK health and care services,
Marks and Spencers (M&S), National defence association, Atomic Weapons Establishments are
the organisation of public sector which are working successfully in UK.
Purpose :
improving the structure of economy by providing job opportunities are the main
objectives of these type of organisations. These organisations works in enhancing health and
social care services, education and defence services.
Legal structure :
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(Source : Legal structure of public sector organisation,2017 )
Voluntary Sector : Organisations which operate there actives in building effective society
culture, spreading awareness and constructing strong living standards of underprivileged people
and communities. Donations, contributions, charities are the source of income for voluntary
organisations (Halbert and Ingulli, 2011). Government, business organisation provide required
support and resources to run operations effectively.
Purpose :
Making healthy and educated society and level up the standards of lower communities
and poor people are the major objectives of these type of organisations. These organisation
organise different training and development programs for making skilled and professional
personality. It also support business organisations by providing manpower and employees.
P2 Size, scope and different type of businesses
Various type and form of business are found in business environment. Below are some
organisations taken from private, public and voluntary sector.
McLaren Technology of group
this is one of the successful private organisation across the world. It deals in providing
advanced technological equipments and manufacture luxury cars. It also represent its group in F1
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races and sports events. It was founded in 1963, from then to now it has achieved lot. It is a
reputed brand name in luxury car industry. It has won 20 world championships and more than
108 car races across the world.
As per innovations and techniques criteria it has accomplished its own research and
development centres in UK. As per reports McLaren racing formulations and services upgrade
MCL32 every 17 minutes, 24 hours a day. Being a part of world's number one sport race F1 it
keep finding and innovating its dynamics in various streams (Avramenko, 2012).
It has multiple sections and organisations as McLaren racing, McLaren Automotive and
McLaren applied technologies. It has large team of skilled and technical engineers who keep
working best every day. Innovative ideas and experiments remains daily part of their life. It has
its own research plants and development centre which is operated by 5300 employees approx
including managers and leaders. Net income in respect of GDP is approx 21 million till 2016 and
revenue was 490 million approx GBP till 2016.
British Broadcasting Corporation (BBC)
It is one of the largest public broadcasting service provider in UK and across country.
BBC is world's senior organisation in the world which is working in mass media and news
sector. It was established under a royal charter which is a set of 750 organisations and consent of
secretary of state for culture. It works in providing multiple news types as political, social and
sports. It started its operations and activities from 1920 and completely merged in 1922. It come
in existence in 1927 as British Broadcasting Corporation.
it has approx 21,000 approx employees strength. It has £59 million net income and £166
million operating income in 2015-2016. Its headquarter is in UK.
Business magazines, radio, music, sports are its further broadcasting networks which are
operated by this organisation at various level. It has its own board of directors and management
teams which helps in taking decisions and making plans. Its departments are divided in different
operational divisions as Content, radio and education, news and current affairs, deputy director
general group, news and current groups.
Oxfam charitable organisation
this is an organisation which works for societies underprivileged communities to
improve and enhance living standards of people. It was founded in 1942 to protect the rights of
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poor and make awareness towards health and education. It helps in making strategies,
development and growth plans policies for securing life of these people. It is majorly focused
upon removing poverty by providing jobs and placements to eligible and skilled employees
(Burns and Winter, 2011). It operates various activities and organise campaigns for encouraging
people towards building strong nation. Giving justice, demolish poverty and social welfare is
prime mission and vision of these organisations.
TASK 2
P3 Connections between various functions of business organisations
Business size remains bifurcated in multiple departments and functions and they also
remains interrelated with each other. These departments have to work and perform there
specified task to lead the task further. As one department complete the work from their side then
only the task or project allocated to further department.
McLaren technology group has its own research and development centres which works
individual and being together. It has its automotive industry which builds racing cars on its own
name. It has skilled technicians, mechanical engineers who work hard for better results.
Innovations and advancements are the theme of this organisation (Chow and et. al., 2011). Its
management staff and directors keep monitoring the task and policies of country and business
environment across the country.
Its functional departments also divided in multiple teams and groups which are as under :
Board of directors
these are the people who retains the rights of making policies, plans and strategies. All
the powers and responsibilities regarding approvals and permissions are given by this
department. Owners, investors and businessmen are the part of this department.
human resource department
Managing people of organisation and fulfilling the requirement of employees HR department is
formed in McLaren. It hires and select experienced and high skilled workers and engineers who
have vast knowledge of automotive industries. HR managers also seek best managing and
operating officers to operate functional departments. HR department manage the leverage of
employees in company.
Management departmental
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For better operations and guidance there must be a team of leaders and managers who
could helps staff member. Managers are answerable to their senior authorities as board of
directors and stakeholders. They prepare work reports and graphs to analyse the work. Managers
communicates employees and resolve the conflict of their staff members. They also support in
making developing plans and strategies for further growth.
manufacturing and production department
McLaren use best plant and machineries in manufacturing their products. Its brand name
is knows as fastest car manufacturing industry in the world. This function remains connected
with sales department. It has best places and best workers which helps in communicating and
developing the scope of organisation (Commander and Svejnar, 2011). Advanced tools and
mechanism is the base of its manufacturing and production department.
Sales department
McLaren provide luxury cars and automotive and produce formula one racing cares. Its
sales department keep records and analysing projects reports in comparison to its competitors. It
remains responsible in making effective marketing and competitive strategies. It provides actual
data and records to manufacturing and production department to analyse actual requirement of
products.
IT department
technology and advancements are the base of industries. Its technical staff helps and keep
experiments in new advancement and techniques. It has its own mechanical and research
department and have extra ordinary skilled employees. The utilise their knowledge and
experience in making environment friendly and cost effective mechanism. This departments
helps research and development centres and communicate with current scenarios of organisation.
TASK 3
P4 Affirmative and counter impact of macro environment upon business operations
It is an study of surrounded factors and environment of business to expand the scope and
size in near future. PESTEL analysis is method of evaluation of business environment in respect
of further expansion and innovations.
Political
All the factors related to change in the environment of politics in UK impact the
management and operations of McLaren technology of group. Brexit was the most historic and
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recent political change which was faced by McLaren automotive industry. UK automotive
industries has to change their export and import policies in respect of European Union countries.
There was an mix impact fall upon McLaren technology group. There were many restrictions
faded away and allows international trading.
Economical
McLaren is a brand name in UK automotive and technology group. Represent UK in
Formula one races and championships. It has won more than 200 races and championships
across the world. It build a goodwill and represented the image of UK's mechanical industry at
international level (Cronan and et. al., 2011). Today many large and big business projects are
incorporated with McLaren industry. It is providing employability and supporting economy to
make it strong and sustainable.
Social
organisation keep seeking new advantages and opportunities for future growth. Its social
corporate responsibilities are centralised in making skilled and professional people. Its
innovations and new ideas works in building advanced society. McLaren applies and guide in
adopting science, technology, engineering and mathematics so that people and community grow
towards advance learning.
Technological
Technology is one of the specific reason because of which this organisation is famous in
the world. Recently McLaren generated an turbojet engine which gives best results and
performance in effective and optimum fuel consumption level. It is also innovated latest future
gadgets and auto mobile cars which operated by electricity and batteries. It invented a super car
model in 2015 which was a best combination of human skills and artificial intelligence.
Legal
Rules and regulation regarding traffic and auto mobile industries. Cost of acquisition of
its products is very high and there are lots of legal formalities are made to have cars and
machineries. There is high taxation rates are made for luxury products and equipments in
Landon.
Environmental
manufacturing department of this organisation uses natural resources in large amount to
make its products. Steel and tools are the main sources which remains required in regular
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manufacturing process. Consumption of natural resources at large scale also impact the balance
of environment. McLaren research and development uses recycling method and use natural
resources in effective and balanced manner.
TASK 4
P5 Analysis of strength and weaknesses of McLaren
Strength
McLaren is of the successful and strong technology group. It has a multiple organisations
type as McLaren automotive, Aligned technologies and McLaren racing. It has large market
share and capital market. Its already set market place and goodwill so need not to spend large
amount on advertisement. It has market barriers (22% and 21%)
Weaknesses
it has vast competitive environment at international as Mercedes Benz, BMW, Ferraris
are one of its closest competitors in market. It contains high cost in build up new structure of
organisation (Dahan and et. al., 2010). Organisation has some moderate and conservative
approach in making cost effective and low level concepts and designs. Its has ratio of loosing
suppliers (30%, 57%)
Opportunities
It has an opportunity to expand the business size in other countries. It has various options
to invest its resources and technology with other automotive organisations. It may take
advantages by setup its organisation type in growing economies as India, Ghana and Philippines.
It may become a global leader as investing and upgrading its systems and techniques on regular
basis.
It has also a great opportunity to make new customer and sales market in multiple countries. It is
not only beneficial to organisation but also beneficial for economic growth.
 Implementation ratio (58%, 56%).
 Global growth opportunities (48% and 23%)
 Agreements between another countries as (25%, 17%) New product and services ratios (38%, 34%)
Threats
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Industry may face many kind of situational phases (37%, 28%). Multiple and global
business environment of different countries. Competitive change also creates uncertainty in
making effective marketing strategies.
 Ratio of price changing (48%,29%)
 Automation and artificial intelligence scope (53%, 16%)
P6 Correlation of strength and weakness with external environment of business
Strength and weakness analysis helps in identifying the key factors and principles of
expansion of business at next level. Automotive industries are the sectors which get impacted at
large scale by changing in environment of business. Advancements and technology plays vital
role in auto mobile and car manufacturing industries (Fernando, 2011). SWOT analysis helps in
getting the data related to further expansion of business size across the globe. It not only helps in
understanding the strength and weaknesses of organisation but also helps in improving the image
of nation and organisation too.
Above analysis is done in respect of McLaren technology group. An organisation remains
familiar when it works in its native country. But when it expand its business type at large level it
has to manage lots of things. Different economical and cultural environment effect the business
and also create challenging situations in making the image of business. Organisation has to deal
with political environment of different territories and there procedures remains different as per
there state of constitution. How McLaren relates with macro environment is defined as under :
Culture and social factors :
Culture and traditions remains different as per diversities of countries. It is very important
for an organisation to analyse the interest and abstract of culture of country. This may positive
and negative impact fall upon business of organisation. If the product and services does not relate
with culture then it become difficult for that organisation to grow effectively. What are the social
requirement and the culture needs must be required to analysis by McLaren to avoid challenging
impact of social and culture factors.
Political factors : Diversities and democratic environment of the country are the base of political
environment of organisation. There are many countries where foreign investments amount is
very low and controls and rules remains centralised in the hand of their local government.
Uncertain political environment also balances the operations of business.
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Technological factors : Changing atmosphere of technology and advancement are the part of
life. Advancements and changes contains high utilisation and implementation cost. McLaren has
its self designed structures and plans which remains flexible in any kind of situational change. It
is brand name in adopting changing and implementation. There are some factors found which
impact upon business types also.
Economic factors : McLaren deals in high cost and luxury cars and equipments. In developing
and average economy it may face shortage of targeted customers. GDP, growth rates and income
groups are the factors which effect the organisation in the form of economic factors. If any
organisation invest in developing countries then it remains expectation from the organisation that
it will provide employment conditions and job opportunities to desired candidates (Gebauer,
Paiola and Edvardsson, 2010). This is the major challenges for multinational organisation.
Environmental factors: Availability and approachability of resources are most challenging
situations for any organisation to deal with. Large size organisations uses high amount of natural
resources in making products. It is require that there must be availability of resources in specified
country or territories. There are lots of laws and restrictions have to follow while utilising the
resources and in organisation.
CONCLUSION
Business environment is made of multiple departments and group of people who works
together to fulfil targets and goals of an organisation. This report helps in understanding the
meaning of business environment. How different types of entities works in various kind of
situations and circumstances. There is a corporative relationship created by functional
department with other management departments. How this cross functional helps in decision
making strategies and making plans discussed in this context. Impact and effect upon business of
rules and regulations also described in this research. This research is formed as per private and
public sector organisation.
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