Business and Business Environment Report: Morrison's Case Study

This report provides a comprehensive analysis of Morrison's business environment, focusing on both internal and external factors influencing its operations. The report begins with an introduction to the business environment, emphasizing the importance of considering various factors for effective planning. It then delves into the specific case of Morrison's, a leading supermarket chain in the UK, examining its micro-level activities, objectives, functions, and culture. Task 1 explores different types of organizations, including public, private, and voluntary sectors, detailing their legal structures and purposes. Task 2 involves an in-depth analysis of Morrison's, utilizing SWOT and PESTLE analysis to identify strengths, weaknesses, opportunities, and threats, as well as the impact of macro-environmental factors. The report also assesses the size and scope of different organizational types, such as London Transport, Morrison's, and Oxfam. The conclusion summarizes the key findings and insights from the analysis. The report aims to provide a thorough understanding of the business environment and its impact on organizational success, using Morrison's as a practical case study.

BUSINESS AND BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purpose of organisations with their legal structure...........................1
P2 Size and scope of different type of organisation...............................................................4
P3 Relationship between functions of various organisation...................................................7
TASK 2............................................................................................................................................9
P4 Positive and negative impact of macro environment........................................................9
P5 Internal and external analysis to identify strengths and weaknesses..............................10
P6 Strengths and weaknesses interrelated with external macro factors...............................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment consist of external and internal factors that have a huge impact on
the functioning of a company and this mainly includes, customers, demands and supply and
cultural that is followed by an organisation (Hilton and Platt, 2013). Thus, in order to run a
business in an effective manner it is crucial that company make sure that all the factors are taken
into consideration so that effective planning can be made. Present report will focus on the
business environment of Morrison. This company comes under fourth largest supermarket in
United Kingdom. Currently, firm is having approximately 498 stores and planning to expand
their business in other geographical area as well. Report will focus on different kinds of activities
at micro level which involves objectives, functions and culture. Moreover, in order to know the
impact of both external and internal factor SOWT and PESTLE analysis is being done so as to
have better understanding.
TASK 1
P1 Different types and purpose of organisations with their legal structure
Public Sector Organisations
These are the kind of organisations that are regulated and owned by government of a
nation and it basically comes under public sector. Thus, they are the firms that work with the
motive of providing services and facilities to customers instead of earning profit. Organisations
that are included under this are majorly educational institutions, health care service providers,
infrastructure etc., Therefore, in order to raise funding for these institutions government take
taxes, fees and other activities from federal to state government (Welford, 2013). As companies
regulated by regulatory bodies are giving better services so they are growing rapidly in most of
the states in comparison of private companies. But in terms of United Kingdom, private
companies are growing in a rapid speed and they are generating more and more revenues for
their organisation.
Legal structure: This basically, constitutes two forms via general government and public
corporations and both the elements are below for explained below:
General government:
Central government: In United Kingdom they are the one who set rules and regulations
for people and company who are operating their business. Central government work with the
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purpose of collecting taxes from public and organisations and along with this they print money
which can be regulated in order to increase economy of the nation (Wetherly, 2014).
State government: In accordance to fundamental point of view, state government has a
political nature and they work in collaboration with national government. Main motive behind
establishing this kind of government is to have a control over education and its related activities
so that a better education can be provided to the citizen of that nation.
Local government: Administration body that are included in this works in smaller
geographical areas like town, city or state. Thus, it is important that local government look after
these areas so that place can be developed. Therefore, these regulatory bodies formulated
policies for the betterment of the citizen living there.
Public Corporations: Firms who hold shares in public for trading which is held by
number of shareholders can be define as public corporations. Their liabilities are limited and its
offers are sold as securities (Moutinho, 2011).
Purpose of Public Sector Organisation: Main motive of public sector organisation is to
providing services and facilities to communities so that their life can be made better and easier as
well. For example: transport facilities that are provided by regulatory bodies are for the
convenience of public so that they can travel from one place to another without any problem.
Therefore, their main purpose of is to provide services instead of earning profits.
Private Sector Organisations
Companies that come under this, work with the purpose of gaining profits and these firms
can be run by a group or individuals. Regulatory bodies don't have any kind of control over these
organisations and some of the examples are retail company, hospitality etc., they contributes
major percentage in the GDP of a nation. With respect to United Kingdom there private
companies are contributing 89 percent of their revenues in GDP. Therefore, these company work
with the purpose of establishing its firm in different areas and locations so that maximum
benefits can be gained.
Legal structure:
Sole Trader: These kind of business are led by a single person and require less finance in
order to set their business. In this it is easier for business in changing their structure according to
the needs and wants. But it has some limitations as well as unlimited liabilities are at risk and it
can be taken in a wrong manner (Halbert and Ingulli, 2011).
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Partnership: There can be a chance that sole traders might not get benefits thus, sole
traders can collaborate in order to make partnership in order to overcome losses. In this, a deed is
signed between two or more individuals with mutual understanding. As a result, it equally
manage burden amongst partners equally.
Private Limited Companies: Most of the private company work with an aim of getting
more and more benefits so that their market shares can be increased. Firms who are associated
with private limited companies have constricted liabilities and profit shares are also divided
amongst people (Sena Ferreira and et. al., 2012).
Public Limited Cooperatives: These companies work with the purpose of providing
necessary services that can be beneficial for people. Employees who are working with these
companies cannot transfer their shareholdings in the society.
Purpose of private sector Organisation: Firm who establish their business under this
category have an aim of earning maximum profits and also for increasing its customer's base.
Mostly, these company establish their business in underdeveloped areas which in return provide
job opportunities to people who are living there or to local populations.
Voluntary Organisation
It is not possible for a single person to run this kind of organisation by their own, so they
collaborate with many individual who have a same purpose or aim of working. These are also
known as Non-Profit Organisation who works in order to develop standard of society and people
who are living there (Kelly and Scott, 2012). Thus, they give welfare to the citizens voluntarily.
These organisation first select a problem and then tend to find ways by which services and
facilities can be provided for the betterment of people. For example: Providing finance to people
who are poor so that they can live their life properly.
Purpose of Voluntary Organisation: These organisation work with the purpose of
creating social impact rather than making profits. Therefore, people who have common interest
collaborate in order to perform their activities so as to fulfil the needs and wants of customers.
For example: Oxfam which is a voluntary organisation work for improving the lifestyle and
enhancing the living standard of poor people so that they can be stand equally with others.
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P2 Size and scope of different type of organisation
Public sector organisation
The main responsibility of UK government is to manage and regulated London Transport
as they are responsible for the same. Major responsibilities includes rail system, roadways,
taxies, buses etc., According to a study, in 2016, government has decided amount nearly £13
billion as a budget and around 40 percent of finance are being arranged through fares or other
activities.
Vision of public sector organisation is that they want to do business with some
stakeholders and their additional industry partners. As a result, it will assist them in giving
reliable, safe and secure.
Other than this, their mission is to provide total security by decreasing the level of crime
rate and fear. Therefore, fundamental objective of London transport is to generate some kind of
policies which can give maximum benefits to the society.
Size of public sector organisation: London transport, tend to provide services around
London, and they has responsibility of connecting principle road routes through rail, buses, taxis
and many more. Therefore, in this organisation around 28,000 employees work and has its main
organ and these are London Underground, London Buses, London Rail, London Street, London
Overground and Cross-rail.
Scope of public sector organisation: Company although is providing services in
London but they can think of spreading their business in rest of the parts of United Kingdom. As
a result, it will provide an opportunity to company in order to increase their revenues.
Private sector organisation
Morrison is one of the leading companies in United Kingdom and they have established
themselves as a large supermarket chain. Firm is providing numerous products to its customers
and it includes majorly dry items, fruits, meat vegetables etc., In the market they have around
10.14% market share which is giving them tough fight to other rival companies who are dealing
in the same field in United Kingdom.
Vision of this company is to provide better products to its customers in reasonable rates
as a result; it will assist them in attracting a large number of customers. This will increase
company’s value and will increase reputation of the firm worldwide (Teece, 2012).
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Morrison’s has a mission of delivering best quality goods and services to its customers in
a certain period of time. Furthermore, in order to retain customer’s loyalty they are producing
commodities as per the needs and wants of consumers. Thus, it will improve the market share
hold by the company in the market area.
Therefore, fundamental target of this company is associated with increasing brand image
and market share around the world. Hence, by improving their status in market area they will be
able to accomplished all desired goals and objectives in a speculated time frame and in desirable
manner (López-Gamero, Molina-Azorín and Claver-Cortés, 2011).
Size of private sector organisation: Morrison is one of the leading companies and
comes under fourth largest supermarket chain in United Kingdom. Currently, this organisation
has 498 stores in different locations such as England, Wales and Scotland. In this company
approximately 132,000 employees are working who are performing their activities in order to
provide benefits to the firm.
Scope of private sector organisation: Company has made its stand in front of its
customers and is well recognised for providing superior quality products to its customers. As
they have limited stores in different locations so they can think for expanding their business in
various parts of the world. This kind of activity will not only increase their market share but also
improve their customer base.
Voluntary sector
They work not for profit but for providing services and facilities to needy people and
these organisation gets funds from charity and donations (Avramenko, 2012). Across world,
approximately 3 million companies are working and they are voluntarily providing services as
welfare to society. National Health Services can be taken as an example under this and they are
doing a great work for the betterment of people.
Mission of this organisation is to protect every individual from severe disease and
poverty so that line of poverty can be reduced. Therefore, in order to fulfil organisation have
certain targets which are given below for better understanding:
 National Health Service want to give best as well as effective services to people so that
they can maintain their health as a result, it will reduce rate of disease in the country.
 In addition to this, manager of this organisation is providing free advice and health
check-up as well on a regular basis (Li and et. al., 2011).
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Size of Voluntary Organisation: Oxfam has an alliance of 20 charitable organisations under
which people are working with the purpose of eradicating poverty from the society and from the
world as well.
Scope of Voluntary Organisation: Oxfam as of for now is working for providing services
in the field of disaster relief, poverty alleviation, policy research, advocacy and pro-migration.
But in terms of scope organisation should think of providing services in other fields as well such
as child labour, education etc., hence, it will broaden the scope of the organisation (Hämäläinen,
Näyhä and Pesonen, 2011).
Shareholder Analysis
In order to run a business every company whether small, medium or large needs
assistance from persons so that activities can be performed in a better manner. Thus, here role of
stakeholders are very important as they assist them in improving growth and improvement in
business operations. In addition to this, in terms of employees they will get a chance of working
with other workers as a result, it will improve their skills and knowledge. In order to find suitable
investors there are certain steps that are to be followed so as to get the same. In the initial steps it
is important that superiors lookout for an association so that investors can be found. Therefore,
organisations have to determine people who can get influenced by work doing by the company.
As a result, it will play some role in the growth in the business of the firm (Cheng, Yip and
Yeung, 2012). There are different kinds of bondholders such as government, partners, managers
etc.
Henceforth, after all these activities it is required for an employee to prepare a list of
shareholders who are in top priority. Thus, manager of the firm will distribute them according to
the interest in affiliation for example some of them are given below:
 High power – interested people
 High power – less interested people
 Low power – less interested people
 Low power – interested people
At the end all the shareholders who are suitable will be include as per the criteria such as
what is providing them motivation, by what method they will gather information and data and
are the factors by which can affect them while performing their activities (Vaiman, Sigurjonsson
and Davidsson, 2011).
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Business scope for Stakeholders: If an organisation is planning for expanding their
business in some other parts of the world than customers can be their stakeholders as they will
get a chance of buying products and goods provided by the firm which are unique in nature.
P3 Relationship between functions of various organisation
Morrison which has established its business in United Kingdom and providing products and
services to its customers around the world is one of the renowned companies. Firm is following a
hierarchical structure of management this is enabling every staff in knowing their roles and
responsibilities in an organisation (Hilton and Platt, 2013). Therefore, it will assist firm in
achieving their goals and objectives in a speculated time. In a company there are many functions
that are to be performed by different departments and while doing their activities they are
interconnected with each department thus, some of them are discussed below:
Sales and marketing: It is an important which every company has to do so as to reach to
maximum number of people. Not only this, assist firms is providing details about the products to
its customer but sales and marketing also let company know about the needs and requirements of
consumers. Therefore, for this, it is crucial that company use appropriate tool and technologies
like effective social media tools, print media, advertisements etc. As a result, through this
company can easily enhance their sales which will in return provide maximum benefits. Sales
and marketing department is majorly linked with Research and development unit which provide
firm with appropriate knowledge about the nature and demands of customers. Furthermore, R&D
with the help of conducted research in various locations they will provide the information about
consumer’s choices and preferences company can improve their sales and profitability.
Human Resources: It is one of the important part of an organisation as they are the one who
provides company with talented candidates who are best fir for the job. Other than this, they
provide with training and development sessions so that employees can enhance their skills and
knowledge along with working performance (Welford, 2013). Moreover, it is render that all
workers are provided with effective working environment where they not feel pressurise and
execute their work in a better manner. As a result, employees can feel motivated and appropriate
outcomes can be given.
Research and Development: This department plays an important role in every kind of
organisation as with the help of this, company can get to know about the needs and wants of
customers that can assist firm in providing better services in a limited or set time frame. Thus,
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organisation can sustain in the market area for a longer period of time. In relation to Morrison
they are collecting information and data from consumers through feedbacks and surveys. This
department is majorly connected with the department of finance because without sufficient
amount of money company cannot conduct surveys for making some kind of improvements in
their products or commodities (Wetherly, 2014).
Finance: This kind of department plays a significant role in an organisation as they assist
firm in developing budgets according to divisions so that each work can be executed in a better
manner. In has been evaluated that each and every department is linked with this department
directly or indirectly as each department needs funds for executed their plan. As a result,
company can easily accomplish their set goals and objectives in a set time frame.
Source: Organisational Structure, 2018
Morrison is following hierarchical structure of business thus, all the activities are performed as
per the roles and responsibilities assigned according to the capabilities of departments. For
example: making proper plan of budgets so that it can be finalised about how much funds will be
required in order to execute the plan and other activities. Therefore, for this, account assistance
directly reports to finance supervisors and then to finance directors (Moutinho, 2011).
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Illustration 1: Organisational Structure

TASK 2
P4 Positive and negative impact of macro environment
PESTLE defines as Political, Economic, Social, Technological, Environmental and Legal
Factors and it consider as an effective methodology that provides about the external environment
so that it can be consider by company in order to perform well in the market area.
Political factor: It is a crucial factor that includes financial taxation system or formulates
laws and legislation for proper conduction of activities in a society. This can differ from state to
state or a country. Government of United Kingdom has imposed new rules and regulations and
also have simplified the existing tax policies which can have an effect in maintaining customer’s
relationship for a company. Thus, it is crucial for firms to follow all the laws and legislations
while operating their business in an effective manner (Yoon, 2012). As a result, it will assist
company in maintaining its reputation in front of its consumers. Not following rules and
regulations can show up a bad image of firm to customers.
Economic Factor: This can have an effect on potential customers as a result, company’s
long term economic growth can be hampered. Mainly, the economic factor includes, inflation
rate, unemployment, per capita income, minimum wages rates, economic growth of a nation etc.,
Therefore, by considering all these points managers of Morrison have managed prices of
products and goods which has put an positive impact on its customers. As a result, it has assisted
company in sustain a better position in the market area. But contradictory, if tax rates go higher
than its outcomes can be negative for the company.
Social Factor: It differs from city to city with regards to culture and in terms of United
Kingdom; they have a good social environment which is fruitful for the companies who are
operating their business in UK. In United Kingdom, Morrison has around 500 outlets and all
these are well reputed. In addition to this, company is fulfilling all the needs and demands of
customers by providing customers stuffs that are according to their choices and preferences
(Halbert and Ingulli, 2011).
Technological Factor: With the change in course of time, new technologies have
evolved that are assisting firms in providing better services to its customers. Thus, Morrison has
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incorporated all the latest tools and technologies from machines to application and software.
Furthermore, company is using technologies for promoting their activities through social media,
and other platforms which is directly or indirectly assisting firm in maintaining better relations
with customers. As a result, with the help of this, firm is attracting a large number of consumers
and company is getting benefits in return.
Environmental Factor: It is an important factor for gathering raw materials in order to
produce final product which can be further be delivered to customers. Therefore, while
establishing their business company focus on transport and other facilities for performing the
activities without any complications (Kelly and Scott, 2012).
Legal Factor: While working or operating business there are certain rules and
regulations which should be followed by an organisation so that no difficulties can be faced. In
relation with Morrison they are considering this factor and taking care of their customers in order
to sustain their loyalty.
P5 Internal and external analysis to identify strengths and weaknesses
In order to know about the internal strength SWOT analysis is being conducted so that
company can know about the areas where they have to work more for eliminating the flaws.
Therefore, detailed analysis of the same is given below:
Strengths: This factor mainly shows about the strong point of the company, thus,
Morrison has established as one of the leading companies in United Kingdom. Their supply
chain and its network are strong which provides them with an opportunity of producing goods
and products in large number. Company has around hundreds of store in UK and nearly 13,000
are giving their best for satisfying the needs and demands of customers.
Weaknesses: If a company wants to move in forward direction than it is crucial that they know
about the weaknesses so that issues and problems can be overcome or eliminated. In relation
with Morrison they are generating fewer amounts of revenues because of limited areas where
they have established their business. The biggest problem of this company is not providing
effective customer services because of which their loyal consumers are moving towards other
companies who are dealing in same sectors (Teece, 2012). Therefore, it is important that
managers of a company make appropriate changes so that they can give better services and
facilities to its customers.
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