Business Environment Report: Morrison Company Analysis and Strategy

This report provides a comprehensive analysis of the business environment, focusing on Morrison Company, a major player in the retail industry. It begins by defining and differentiating between public, private, and voluntary sectors, outlining their purposes and legal structures. The report then examines the size and scope of various organizational types, from micro to global entities, with specific examples such as the National Health Service (NHS) and Morrisons. A key section delves into the interrelationship of organizational functions and how they link to organizational objectives and structure. The report also identifies the positive and negative impacts of the macro environment on business operations, supported by examples. Finally, it conducts internal and external analyses of Morrison Company to identify its strengths and weaknesses, explaining how these interrelate with external macro factors. The report offers insights into the company's strategic positioning within the competitive landscape.

Business & the Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1: Different types and purposes of public, private and voluntary sector...................................3
P2: Explain the size and scope of a range of different types of organisations.............................4
TASK 2............................................................................................................................................5
P3: Explain the relationship between different organisational functions and how they link to
organisational objectives and structure........................................................................................5
TASK 3............................................................................................................................................7
P4: Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples.................................................................................7
TASK 4............................................................................................................................................9
P5: Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses.............................................................................................................9
P6: Explain how strengths and weaknesses interrelate with external macro factors.................10
CONCLUSION..............................................................................................................................12

INTRODUCTION
Business environment comprises of the aggregation of different individual entities as well
as factors that can or cannot be in the approach of an organisation to control, but definitely all
these factors hamper its growth and profitability. As every business irrespective of its large or
small size operate in the dynamic environment which make it essential for them to analyse the
external surrounding and function accordingly (Aithal, 2017). For the better understanding of
report, the trainee business analyst of the North west London chamber is to assist the businesses
like Morrison to become more successful. Morrison company has been selected which is a part
of retail industry and offer different food and non food items like vegetables, packaged eatable
items, drink, magazine, clothing etc. The company has the largest supermarket chains and deal
with customer via both physical stores and online platform. This report cover topics like
different, type, size as well as scope of the company. Analyse the interrelationship among
different functions of an organisation and how they are related with the organisation structure.
Determine the positive as well as negative influence of the business operation within macro
environment. Further, explanation of the internal strength as well as weakness of the business are
covered in the report.
TASK 1
P1: Different types and purposes of public, private and voluntary sector
Organisation basically refer to the entity that comprises of different type of people who
come together to attain the single objective. There are different type of organisation such public,
private and voluntary that have their own responsibility, structure and purpose which is
explained below.
Public organisation
It is owned, managed as well as operated by the government in order to generate the
profit for the social welfare. Here the organisation offer services at nominal rate so that different
category of citizen can avail the reliable services (Chi, 2015). Funding for these organisation are
raised from the taxes, fines and fees. The National Health Services or NHS offer healthcare
services such as optical care or dental care to the local residence of United Kingdom. Most of the
people rely on these services to get the prescription or surgery done from the professionals.

Purpose: The purpose of public company is to enhance the economy by investing on
infrastructure, education and healthcare facilities for the low income group people that provide
them fair and effective chances to improve their livelihood. In context to NHS company its
purpose is to offer the same hospitality facility to the people of different social classes. This can
enhance the quality of life and services for different individual and families.
Legal structure: As public organisation is run by legal authorities due to which such
companies can be controlled by central government, state government or local authorities. Due to
which the governments is sole responsible to carry out all the expenditure as well as makes
precaution to carry out adequate functioning of firm.
Central: Central government is basically the apex body that function to regulate the
different departments in order to function for the welfare of society.
State: These legal authorities are basically liable to make the authority for the specific
zone. Based of this they monitor the functioning of different department in order to control and
restrict unethical practices.
Local: It include the role of municipal communities that usually manages the small area
which can be either town or village. Intervention of these authority enhances the legal practices
which help to build the lives of the local people .
Private organisation
Unlike public organisation, these companies are usually managed by the individual or
group of partner. The major objective behind these companies is profit maximization for which
they fulfil the need of customer and diversify their operations globally (Craig and Campbell,
2012). It terms of Morrison company does not involve the interference of government as it work
for self motive rather than social motive.
Purpose: The purpose of private company is to focus on the quality of product and
generate loyalty from the prospectus by delivering them suitable offering. Along with that the
company try to differentiate from competitors in order to enhance the brand loyalty. The purpose
of Morrison company is to become the global leader within retail sector , for which they adopt
innovative techniques to differentiate its services from the other.

Legal structure: The legal structure of the private company comprises of sole proprietor,
partnership , cooperative and limited companies which are further classified as private and public
limited company.
Sole proprietor: The business is set up and controlled by the single entity who brings the
capital along with them and have the liability to pay the expenses of company. The owner is sole
responsible to take all the necessary decision of business without any chaos or conflict. For
instance, PaperRocket Accounting business was started by the Sarah Solo and worked within
contractor accountancy world in order to become professional accountant.
Partnership: This business is carried out by more than two partners that collectively
come together and participate in the functioning of business. The share or the ration associated
with the profit and loss varies from one partner to the another depending upon the contribution
on capital. It involve preparation of partnership deed that involve all the details of partner along
with their contribution.
Private Limited companies: It comprises of the company that has separate legal entity
that mean the business is distinct from the people or owner who run it. Due to which each
shareholder of the company have limited liability which mean they are not all all liable to pay for
the further losses or debt. There are two type of limited companies that is public and private,
within public limited the companies issue the shares to the public and help them to take the
ownership of company. Further, private limited companies can be register with the minimum 2
members to maximum 200 members. The liabilities are limited and here the company can even
continuer to exist even if the own dies or goes bankrupt. For example, Brakes is a private limited
company that offer and supply the different food items and beverages to the different catering
industry of UK. In context to the Morrison company falls under public limited company as here
the public are allow to issue the share of company. This is profitable situation for both Morrisons
as well as its customers like the company gains the fund which can be used fro different
functions like to enhance the quality of product or diversify the business. Similarly, with the help
of financial statement the public identity the performance of company and gain better rate of
return due to the high profitability as well as productivity.
Voluntary organisation
These organisation usually include the group of like minded individual who come
together and function for the social cause. It involve the non profit organisations that work

voluntary to accomplish the certain purpose (Hillary, 2017). Oxfam is the charitable organisation
whose objective is to work against the global poverty and improve the livelihood of each and
every people.
Purpose: Voluntary organisation is formed by the association of like minded people that
join together to fight against the specific cause. Oxfam was incorporated in 1995 with the sole
purpose to reduce the injustice by eradicating the poverty issue globally.
Legal structure: Usually the different types of voluntary organisation have legal
structure like charity, limited guarantee company as well as trust. Within this the company gains
the donation for the public known as charity, which is used to accomplish the specific social
cause.
Trust: This legal structure involve the organisation that uses the fund in order to manage
the property for specific purpose.
Unincorporated Association: Here, in this type of companies the people engages
voluntarily for the short tenure with the objective to overcome the issue.
Oxfam company which work for the social cause amongst Trust as well as
Unincorporated Association has adopted the trust legal structure. As respected company is the
collection of 19 independent organisation which gets the charity from the individual, business as
well as government to carry out different process. The person who offers the fund to the
organisation in order to participate for the social welfare is known as donor. Thus, such
awarenesses and contribution of the people help to fulfil the particular social cause.
P2: Explain the size and scope of a range of different types of organisations
Size: The size of the company is determined by the several factors like sales per
company, number of employees and profitability ratio.
Scope: It determines the capability of company to grow or expand within or across
geographical area in order to enhance customer base.
Different type of organisation
Micro organisation: it refer to the small business which have only the capacity to
employee nine employee or less than that e.g. Castle Hill fire protection ltd. It is usually run by
the family members that may employee two or more people to generate the revenue out of their
business.

Small organisation: The size of these business are relatively larger than micro
organisation as they employee less than hundred worker to function independently like LMA
Recruitment. It may include business such as sole proprietor or partnership.
Medium organisation: This enterprise have capacity to employee around 200 people
that collective work to empower the lifestyle of people and enhance their experience by gaining
better positions, for example Verdant Leisure.
Global organisation: It basically involve the companies that have the objective to
maximise profitability for which they move beyond their working area or reach out to
international boundaries in order to build global image. It comprises of ifefrent types tahat is
explained below:
Multinational: It function in multiple countries to promote their offerings and enhance
global image but they focuses to bring modification in the product as per the demand of local
market. Like, Tesco added highly nutritious product or varieties of organic items in order to cater
the requirement of health conscious people.
Transnationals: These are the complex organisation which invest different activities like
foreign operations, research and development to deal with foreign buyer. These company such
as Vodafone does not consider any one country as its national home.
International company : They just involve in the productive activities like import and
export of goods and services rather than making the investment outside their home country. It
include companies like HSBC holding and BHP Bilton PLC.
Business operate in the dynamic environment that constantly changes so accordingly
different form of the firm on the basis of their size and scope prepare their objective, vision and
mission that is determined below:
Public company (National Health Services)
Size: This company was established in 1948 and offer the medical services to the large
audience of England, Scotland as well as Wales. For this the company has offered employment
opportunity to approximately 17,00,000 people who have specialised knowledge over their field.
Additionally, the company operate at large scale due to which in 2019 the annual budget of
company is over £115 billion.
Scope: Along with size the scope of NHS is also wide, as it is funded by the government
due to which it uses viable equipment or technique to retain the trust of people. Along with this

the researcher makes the adequate decision to regularly enhance health related issues for the
customer. It make precaution to prevent the impact of diseases in the health of whole society,
instead of concerning only for one individual. This depict that the scope of NHS is to adequately
serve the national requirement because it makes the effort to reach out each and every local
residence of UK successfully. Additionally, for this the experienced professional or doctors are
hired who have specialised knowledge over their stream and can effectively help the local
residence to overcome their illness. This laid the NHS to gain the loyalty and expand its size by
meeting the requirement of national area.
Objective: The objective of company is to improve the level of sound health care in
order to achieve best possible result to maintain the quality of health care services.
Vision and mission: The vision of NHS is to help the people to lead the healthy and safe
life. Whereas, its mission is to regularly improve the status of health in order to promote healthy
lifestyles.
Private organisation (Morrison company)
Size: Morrison company have one of the largest supermarket chains that determine it has
large size. It was founded in 1899 and has around 490 physical retail outlet. It has over one lac
potential employees that help the company to generate the net income of £311 million. Along
with that with the enhancement in technology, Morrison company uses the online platform to
directly deliver the goods at the footstep of customer.
Scope: It is the fourth biggest outlet for which the company focuses to strengthen the
distribution channel to cater the people of each and every corner effectively. Along with that they
have the scope to attract the involvement of youth from various channels of business. Simply the
scope of Morrison company is to expand its size effectively in the global market so that they can
gain the dominance in retail market. Due to which it even concentrate to hire the most potential
employee that can work effectively to attain the goal and take the organisation in better direction.
Thus, this can let the firm to potentially diversify its business in the different geographical area
sustainably.
Objective: The objective of company is to use potential medium or sources to serve the
market in more efficient manner. It basically uses advance technology to deliver the product
within market.

Vision and mission: Morrison's vision is to deliver valuable items to the customer for
their well being. Further, their mission is to consider the valuable feedbacks of customers in
order to remain competitive.
Voluntary organisation (Oxfam)
Size: Oxfam company started its non profitable business in 1942, for which they
collectively work to give the relief to poor people from poverty. It serve the worldwide area for
which nineteen charitable organisation work together to fulfil the same motive.
Scope: The company became functional for the global movement that determine it has
the broad scope to fight against inequality and beat the poverty together. This helped the people
to rebuild their lives and fulfil the basic need that is food, clothing and shelter.
Objective: The objective of Oxfam company is to reduce the gap between rich and poor
by enhancing the social condition of the weaker or unprivileged section of the society.
Vision and mission: The vision of company is to remove the global poverty whereas its
mission is to cover the basic need to customer and embrace their living standard.
TASK 2
P3: Explain the relationship between different organisational functions and how they link to
organisational objectives and structure
The main motive of the different type of an organisation is to fulfil the goal for which
they adopt the suitable structure. The purpose of different type of structure is to meet the need
target market and progressively conduct the functioning of business (Types of organisational
structure, 2019).
Divisional structure: This structure is most commonly seen in the large companies that
operate in the wide geographical area in order to cover the wide needs of the customer rapidly. It
comprises of different division that collectively work together to attain the long term objective
and scope of business. Like different sales team are responsible to cover the geographical area
effectively.

Illustration 1: Divisional structure, 2019
Source: Divisional structure, 2019
Matrix structure: This is the hybrid structure which include the combination of
divisional and functional structure. Such dual management helps the manager to cover different
aspects of the managerial activities effectively.
Illustration 2: Matrix structure, 2019
Source:Matrix structure, 2019
Functional structure: The organisation comprises of different head or division which
comprises of the small groups that are prepared to fulfil the specific objective of the business. It
may include group like marketing, finance as well as information technology that have deep
knowledge regarding their context and help to operate the business functioning. The
representatives of Morrison company gets the advantage of this structure as they are divided into

various sections on the basis of their skill set or capabilities. It assist the company to attain the
better result by meeting the expectation of business effectively. Hence, there are different type of
the structure such as divisional, hierarchical, functional as well as matrix, amongst which the
Morrison company has opted functional structure.
Illustration 3: Functional structure, 2019
Source: Functional structure, 2019
Interrelation of the different organisation function
Research and marketing: As Morrison company adopt the functional structure that
determine both the research as well as marketing function perform different activities. But both
of them are interrelated with one another like the role of research department is to anticipate the
changing trend as well as need and preferences of customer (Ifinedo, Pyke and Anwar, 2018). On
the basis of this the relevant information is delivered to the marketing department that help to
launch the innovative product in the market. Thus, the interrelation of different function helps the
organisation to attain the long term objective of Morrison company that is to offer the quality
product to the potential customer.
Marketing and finance: These two department interrelate with one another with the
objective to manage the cost and reduce the unnecessary expenditure of company in order to
deliver the quality output to the customer. As financial department prepare the budget of the
overall Morrison company with the purpose to maximise the productivity. Additionally,
marketing department role is also to spread the relevant information about the company in order
to attract the interest of customer. So it depend upon the budget prepared by the finance function

to allocate the resources for the different business activities (Palepu and Healy, 2013). Thus,
functional department helps the Morrison company to maintain the clarity and coordination
among different groups of an organisation.
TASK 3
P4: Identify the positive and negative impacts the macro environment
Any change in the macro environment directly affect the functioning of large players like
Morrison retail store. So the company need to constantly shape its policies and gain overall
profitability by focusing on the different external activities in order to sustain the business
operations. It include the PESTLE analysis which is the strategic tool and assist the company to
analyse the external market appropriately (Palo and Tähtinen, 2013).
Political factor: It comprises of the government regulation or law, policies as well as
trade tariffs which is mandatory for business to adopt. Morrison company before diversifying in
any country need to understand these political reforms and determine the stability so that they
can sustain in the market effectively.
Positive: Morrison company majorly depend upon its home country that is UK because
their the political situation are stable that favours the country to generate huge amount of
revenue. This further assist the Morrison company to bring innovation and sustain in the stable
market by generation invention for the convenience of external market.
Negative: The government of UK has announced certain laws for the food and non food
retailer that they have to manage their waste as per Environment Protection Agency. This has
finally enhanced the cost of Morrison's retail outlet.
Economic factor: Morrison company uses the different economic factors like interest
rate, inflation rate as well as growth rate to determine the forecasted growth within retail
industry.
Positive: Although there are different economic fluctuations like inflation or recession
but still Morrison company due to its stable or reasonable pricing strategy survive in different
conditions. The people have loyalty towards company due to which they are capable enough to
maintain profitability (Rezaee, 2016).

Negative: Within, UK the food items are not giving much revenue to company from 2016
onwards because of the inflation in the food prices. This has somewhat restricted the growth of
Morrison company within its home country.
Social factor: It refer to the societies culture, their attitude as well as share culture which
are valuable for the marketer of Morrison company to understand the perception of customer and
design the policies accordingly.
Positive: Morrisons company has the growing business opportunities for the ageing
population of United Kingdom as they get pension which has enhanced their disposable income.
Additionally, the company makes effort to provider convenience to the customer of different age
group in order to sustain their interest and increase profitability for business.
Negative: Due to the impact of globalisation as well as digitalisation the preferences of
the consumer constantly changes. For example, earlier within food items most of the people
prefer junk food but now organic or healthy items are preferred more. Thus, this has somewhat
negatively influenced the company as they need to incur huge investment to retain the interest of
customer.
Technological factor: Technology or innovation represent the better and more effective
ways to deal with the customer as well as supplier of company. This include the use of special
software and computer technology that help to offer the potential services to the required section
of society.
Positive: The manager of Morrison company makes possible effort to attract the potential
customer through digital platform. This is the useful technology as it has offered the convenience
to the customer in terms of placing the order and receiving it at their footsteps. Moreover, with
the help of this platform the company can get the result at real time.
Negative: The negative feedback of customer posted on the website or reviewing site of
company such as yelp can lead to negative publicity that can affect the sales of new customers
(Shenkar, Luo and Chi, 2014).
Environmental factor: Different geographical areas have their own environmental
standard that directly impact the productivity or profitability of the company. So Morrison before
planning to enter in any new zone need to consider these environmental standard such as weather
condition and waste management.

Positive: Morrison company uses the sustainable methods due to which it gets support
from the government of different countries. Along with that the company rely on recycle
material for the business operations.
Negative: Although sustainable practices are beneficial for the environment but it has
again enhanced the overall cost of company which they have to bear by using recycled material.
Although waste management practices are effective but leaves additional expenditure over the
functioning of company.
Legal factor: In include certain law or legislation that are made by the government and
it is necessary for the firm to follow these laws to gain overall competitive edge. This finally
leads to carry out the smooth business operations.
Positive: Morrison company mainly focuses on their staff due to which they offer them
the safe working environment as well as fair wages. By abiding the rules and regulation helps the
company to retain the employees of an organisation for long duration.
Negative: As the government of different countries keeps on developing the legislation
which restrict the operation or growth of business. By following different standard for the
welfare of employee, it may be possible that company may not expand its operations
appropriately.
TASK 4
P5: Conduct internal and external analysis of specific organisations in order to identify strengths
and weaknesses
Morrison company is the leading retail company that sustain in the competitive
environment due to which SWOT analysis assist the company to determine that internal factor
(strength, weakness) as well as external factor (opportunity, threat). Such planning tool can help
the company gain dominant position within the market.
SWOT for Morrison company
Strength
 Morrison company has huge brand recognition which help the company to gain the brand
equity and conduct portfolio investment effectively.

 Oven the significant years respected company have focused to build the effective
distribution channel that help the company to fulfil the need of existing customer and
expand the brand by reaching out potential market.
Weakness
 By using ineffective demand forecasting technique the company remain less effective to
cater the emerging need of customer in comparison to the other rivalries. This even affect
the trust of loyalty of customer towards company (Tynan, McKechnie and Hartley,
2014). Although the company has expanded its scale of operations to the different geographical
market which require the enormous investment in the technology that actually hamper
company's liquidity.
Opportunity
 Online channel is the opportunity for company as various customers are using this
platform to leverage the services of company (SWOT analysis of Morrison company,
2019). Additionally, company can too gain advantage by knowing its actual customer
base and their needs via data analytics. Strategic alliance is again the opportunity for company to dilute the rivalries pressure and
expand the market share suitably.
Threat
 As the Morrison company has the centralised database used to store the data of
customers. So privacy breach is one of the threats that can hamper the confidentiality of
customer and can affect the trust over Morrison company.
 Intense or neck to neck competition from other large retail organisation is again the
threat to company that leads to downfall in the functioning.
SWOT for National Health Services
Strength
 NHS is mainly financed by the Central government due to which all the major decision is
taken by the government. This led in the systematic functioning and has build the strong
brand image amongst public. People usually trusts the services of government because they know that the objective of
these local authorities is social welfare rather than profit maximization.

Weakness
 Globalisation has leads to the increase in number of private hospitality companies whose
uses advance technology as well as supreme level of services. This usually appeal the
interest of high income group people. The internal staff usually faces the difficulty to due to length chain of command and
authority.
Threat The major challenge NHS faces is due to the increase in number of diseases, wide ageing
population as well as number of innovation that has affected internal functioning.
Opportunity
 NHS has the opportunity to involve in the research and identify the reasons for increases
in health issue. Based on this they can education their patient and generate positive
experience of patience by enhancing their health condition.
 Due to the number of rising issue and less availability of processional in comparison to
staff. The company can conduct online consultation which is cost and time effective
P6: Explain how strengths and weaknesses interrelate with external macro factors
Political
Strength: The strength of the Morrison company is that it mainly function in the
developed countries like UK where the political equations are quite stable. Due to this the
company can make the innovative policies and execute it effectively.
Weakness: With the increase in competition and its negative impact on the environment
or small industry the local authorities impose the high tax duties on the large companies like
Morrison company. Such dynamic actions are the major threat to business that can immensely
affect the business performance (Wetherly, 2014).
Economical
Strength: As the company usually attract the customer through its quality product for
which it set low prices due to this even with the change in economic condition like inflation
when the people reduces their expenditure due to increase the prices of commodities, the
company gain the desirable amount of profit. As customer can not compromise in the necessity
item.

Weakness: Different economic condition affect the profit margin of company as they
need to sustain their cheap policy which affect the revenue generated by Morrison.
Social
Strength: Morrison company is customer oriented so on the basis of changing pattern the
company too changes their offering. Like, with the increase in health consciousness the company
has started offering healthy or organic food items.
Weakness: To sustain in changing environment the company on constant basis has to
undergo deep investment other the other large rivalries like Tesco or Sainsbury can take its place
Technological
Strength: With the help of electronic media the company has effectively build the long
relationship with its existing customers (Hilton and Platt, 2013). Along with that that they can
target the large audience within stipulated time.
Weakness: Adoption of new technology require training of the employees so it is
challenging for the company to make the staff understand regarding the need to adopt the
changes and help them to adopt new regime.
Environmental
Strength: Morrison has implemented the effective CSR policies like abolition of the use
of plastics, use recycled material for the food items as well as make effort to reduce carbon
emission.
Weakness: Due to the large size and operations the manager of the Morrison company
does not get the adequate report of the CSR activities which is the loophole. Although several
measures are implemented to avoid these issues.
Legal
Strength: The company follows the different legislation of the government such as
offering fair wages for the similar type of work. This has shaped the internal functioning of an
organisation effectively.
Weakness: The conflict if interest as well as adopted of different legislation at different
areas is a weakness of company as it restrict its growth (Schaltegger, Lüdeke-Freund and
Hansen, 2016).

CONCLUSION
From the above report it has been concluded that Business environment is the valuable
part of a firm which they need to understand in order to carry out the smooth operations. There
are different type of an organisation that different in terms of size or structure for which the
manager adopt different policies to fulfil the core objective of firm. Along with this it is vital fro
the company to analyse both internal and external environment with the help of SWOT and
PESTLE analysis for the systematic functioning of the firm.

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