Business Environment: Unilever PLC Analysis Report, HND Business

This report provides a detailed analysis of Unilever PLC's business environment. It begins with an introduction to business and the importance of internal and external factors. Task 1 covers different organizational functions within Unilever, including human resources, IT, production, sales, and finance, ...Read More

Business environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 & P2 COVERED IN PPT..................................................................................................1
P3 Difference between different organisational functions.....................................................1
TASK 2............................................................................................................................................4
P4 Positive and negative impact of macro environment on organisation.............................4
P5 Internal and external analysis of organisation...................................................................6
P6 Relationship between external and internal macro factors................................................9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Business is a activity which involves buying and selling of products and services for
achieving different objectives such as maximising profits and providing customer satisfaction.
To perform functions and operations of an organisation it is necessary to maintain external as
well as internal environment. These factors influence working environment and operations.
Unilever PLC is a very big business entity that has business of food, beverages and personal care
products as well. It is one of the largest company of consumer goods in UK. Cited organisation is
also effected by all environmental elements (Arasti and et. al,. 2014). This report is containing
different types of organisations, their scope and functions. This report also explains that how
these functions are inter related to each other. It also consists of various negative as well as
positive impacts of environmental factors on Unilever PLC. Strength and weaknesses are also
explained in this file and suggestions are also made to operate functions of a business
appropriately considering business environment.
TASK 1
P1 & P2 COVERED IN PPT
P3 Difference between different organisational functions
Unilever PLC is a multinational company which is identified and well known for its
products such as food items, personal care products and services all over the world. This
organisation have its management which is divided into different departments such as statical,
middle and operational level of management (Haidar, 2012). Strategic management takes
appropriate decisions about development and creating brand of best quality.
Following are various objectives and suggestions in relation to Unilever :
 Reducing such business activities which are not beneficial for organisation.
 There is a need of expansion of their company so that they will be eligible to advance
their technologies to improvise their services and products.
 Management and directors of such company are managing their work and obligations in
such a manner that they can provide best quality products to their customers.
 By increasing sales and revenue of company their stakeholders can also be benefited so
that they can achieve satisfaction and a good return on their investments.
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 To provide all products and services, even new improvised products should also be
introduced.
 Activities those are involved in organisation and having extra costs can be eliminated by
outsourcing those services on lower costs.
Different functions of organisations:
Every department of cited organisation is trying to deliver their best products and services to all
customers with good quality features (Harrison, 2011). Company have so many departments and
each of them have objectives and goals which are inter related.
From above mentioned diagram, it represents that there are many different departments that are
involved in different processes of manufacturing and delivering products as well as services to its
customers. These departments are consisting of following:
 Human resources: This department manages all other functions and departments of
organisations. It provide assistance to employees and solve their problems (Kian Chong,
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Shafaghi and Leing Tan, 2011). They work for accomplishment of all organisational
goals.
 Information technology: These are responsible for all functions and operations relating to
computer software and other technological activities. These also handle payment and
billing services of organisation.
Production department: This department is involved in manufacturing process of
different products demanded by customers. They control all costs as well as expenses involved in
these activities of production. It is further categorised in these:
Site: This is a place where raw material is transformed into the final product and then
delivered to customers.
Product planning: It operates functions such as making plans and strategies regarding
product that is to be produced. It develop new ideas for making better and relevant products
according to need of customers.
Material planning: It involves planning for material to be used and how much quantity si
to be taken to produce goods.
Quality department: This department manages quality of commodity that is ready for
sale. If there are any changes regarding such product then further recommendations are to be
made.
Sales department: This sector of management maintains sales of products and services.
There are number of people who go for survey about demand of commodity in market that can
be arose in future (Klapper and Parker, 2011). It is involved in marketing activities to make sales
of products.
Research and development department: This department is involved in activities of
research regarding existing products and then make innovative ideas for development of those
products. It also involves invention of new products according to needs of society.
Finance department: This is involved in different accounting activities such as
preparing financial statements and annual reports of whole organisation and assess profits and
losses of Unilever PLC.
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TASK 2
P4 Positive and negative impact of macro environment on organisation
There are many factors such as economic, political, environmental, technological,
economical, social as well as legal which effects the Unilever PLC. These are the external
components and elements which influence working operations as well as environment of
company. Different tax policies, different acts, changes in trends, changing economic conditions
and introduction of new technologies from time to time effect businesses and their growth in
market. It will surely help in making betterment and modifications in external as well as internal
planning and strategies of cited company. Every business is effected by these different
components and it is necessary to maintain strategies as well as working operations that does not
harm business surroundings. It have positive impact in reference to achieve selected goals
because it company is performing after considering all elements then it will be easy for Unilever
PLC to retain its place in economy (Lee, Olson and Trimi, 2012). It also has negative effect on
such organisation because it will not be able to focus on main activities. For further discussion of
favourable as well as unfavourable impacts following is the PESTLE analysis of such
organisation:
 Political factors: Different political parties and government make various
policies in respect to business surroundings from time to time. There are also may
regulations and legislations made by government for food as well as personal care
products administration of Unilever PLC. Such corporation has to abide by all
these guidelines. This can be beneficial as well as harmful for company because if
policies are in favour of organisation then it will be best and if not then it will be a
disaster.
 Economic factors: Changes in rates of interest, wages, inflation and other
components of economy which drives different organisations and their working
conditions. Suppose if interest rates are low and loan and funds can be taken from
different financial institutions on lower rates then company can take loan and
then expand their business somewhere else locality so that approach of product
will be worldwide. It is proved as positive impact but on another hand if there are
high rates then company will not be eligible to launch new ideas because of high
cost.
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 Social factors: Contrasting changes in market trends, style, activity of customers,
their taste and involvement are the main components involved in social factors.
Need and necessities of society are to be considered by a business structure. These
changing activities of society sometimes can be proved beneficial for business but
when company is not able to meet these demands and modifications then it will
not be good for Unilever PLC. There are so many products that are sold by
Unilever PLC. It should pay attention and keep itself updated with new trends and
demands of customers so that they can provide high satisfaction to their clients.
 Technological factors: There are always changes in technologies and techniques
of an organisation as well as in whole economy so it is important for such cited
company to adopt these modifications and then introduce such products that can
be proved profitable and usable for whole economy (Moutinho, 2011). Training
programmes should also be organised by such company to aware its employees
and make them familiar to new techniques. By doing it employees will be
motivated and their skills will be enhanced and they will be able to work with full
efficiency.
 Legal factors: Unilever PLC should also analyse all legitimate elements while
performing all functions. There are many laws and legislations made regarding
labour laws, minimum wages acts, gratuity and bonus acts as well as regarding
employees welfare. Establishment should always follow all these acts as well as
should also pay their tax obligations in timely manner and if a company fails to do
so then it will be liable to pay fine for infringement of legislations. All legal acts
as well as guidelines already issued or amended from time to time should be
considered by Unilever.
 Environmental factors: Company should always perform its functions and
activities in such a way that does not harm environment of any nation. These
factors contains all internal and external surroundings (Zott, Amit and Massa,
2011). It should also be taken into consideration that products that are to be sold
by company should not effect negatively all its customers.
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P5 Internal and external analysis of organisation
SWOT analysis can be made to identify the strength and weaknesses of Unilever PLC.
This is a method to identify characteristics of a business and imperfections as well in which it
needs to take reasonable steps to make organisation stable in economy and better than other
rivals and competitors (Palo and Tähtinen, 2011). It direct or indirectly leaves a great impact on
the decision making process of any organisation. Unilever is one of the best company because
their products have a wide range of customers all over the world. By improving their services
and goods offered to public they can increase their customer base because they will be attracted
towards quality of commodities of organisation.
Company can also sell their products through online shopping websites. It will provide
company an endless market even over the boundaries. There are many different resources which
are useful for advancement and betterment of organisation as well as economy. SWOT analysis
help a company to find out that in what ways and areas it is better then others and what are the
areas where company is not performing well. It helps in identifying that what changes company
should made in their management. Following is analysis of Unilever company regarding its
strengths, weaknesses, opportunities and threats:
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strengths:
 Financial position of Unilever PLC is very strong and they have enough can available and
assets also to meet liabilities of organisation. They have enough liquid assets to meet its
debts. It also attracts investors for investment in company.
 Products of Unilever can be accessed through any part of country as well as by outsiders
also. Hence marketing position of Cited organisation is also very good.
Weaknesses:
 There are no inventive and innovative steps are observed from a long time. It is necessary
for them to make changes and modifications to their products according to the changing
trend and demand of customers (Pikka, Iskanius and Page, 2011). They should innovate
their products within a regular interval of time to be stable in market and get competitive
advantage.
 Cost of products and labour is increasing very much from time to time because of that
prises are also increasing so it is important for them to take reasonable steps to control
costs of production and labours.
 Introduction of new techniques in production and distributions of products should be
made because there is lack of these in Cited organisation.
Opportunities:
 Company have an opportunity to expand its business and cover major area of globe and
make their product choice of everyone by introducing automatic features while
production process (Pingali and Roger, 2012). It will also help in lowering labour cost of
organisation.
 Company have option to introduce new products and services in economy as Unilever
has made a good image of itself in economy and people would like to use more products
launched by this organisation. It will also increase revenue of organisation and expansion
process.
Threats:
 There are so many acts and legislations such as consumer protection and other employee
oriented acts and it is difficult to focus on its operations while complying all these
legislations.
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 Products of cited company can easily be copied by any other enterprise. There is no such
patents that can protect them and company also can not make innovative steps easily.
 There are so many competitors available in market in sector of food and health care
products. If they will make more innovative steps to their products and launch more
featured commodities then it will be a very big threat for this organisation.
Above mentioned SWOT analysis provide a complete overview of cited organisation and
provide suggestions regarding using its strengths to create opportunities and improve weaknesses
to eliminate all threats. It represents that what are functions that are done by organisation in best
manner and what are the factors which are increasing sale of this company. It also refers that
what changes are needed to be made by corporation and what are factors which cause to lose
sales by organisation (Reed and et. Al ., 2013). Unilever can make its effective plans and
strategies for its business after making this analysis appropriately.
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P6 Relationship between external and internal macro factors
To make research on external factors PESTEL analysis is being done and for internal
factors it is necessary for an organisation to make SWOT analysis. Both are interrelated to each
other somehow. They directly or indirectly effect each other. For example PESTEL is consisting
of legal factors that effect a business and in internal factors also legal compliances effects
working of organisation. If technological factors are taken into consideration that as a external
factor it is important for a business to make changes in their technologies from time to time so
that it can have sustainable growth and it can survive in economy. While in internal factors also
changing technology adoption is also necessary to find opportunities.
Operations and functions of Unilever PLC will also be effected with changes in different
interest rates because when rates are low, funds can be raised at lower cost but at the time of
boom in rates it will be very harmful for them to raise capital from market (Trkman, 2010). It
will effect expansion plans of company and other operations also.
Sometimes changes are observed in taste and trends of people and it is necessary for
company to modify their products in such a way so that customers can be fully satisfied. Both
external as well as internal factors effect decision making process of any organisation. Whenever
management make any decisions regarding business activity it is important for them to analyse
all factors and then reach to conclusion that what strategies and plans are to be made by them to
maximise profits of company and achieve growth in economy.
Both these factors have positive as well as negative impact on working of Unilever PCL.
These analysis are time consuming and cover some cost for making deep research. Because of
that company can not pay its whole attention towards its operations. But both of these are very
important also to make strategies regarding their products and services and their marketing so
that they can increase base of customers for their products (Wheelen and Hunger, 2011). Both
PESTLE as well as SWOT are crucial for every organisation to be done in best manner so that
they can have knowledge regarding their opportunities and threats as well as if any modification
needed. These above mentioned points can explain that how internal and external factors are
related to each other and collectively effect decision making.
CONCLUSION
From above mentioned report it is explained that business environment is full of many
factors which effect whole organisation. Unilever PLC have many departments in their
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management and they have their own objectives which collectively help whole company to
achieve its goals and objectives. Many suggestions have been given by this research report to
manage all operations of organisation and making strategies and plans for effective production
and marketing of products. SWOT and PESTLE analysis is also made in above file to investigate
about all factors which have impact on an organisation and they also helped in identifying
strength and weaknesses. More over it uncover all opportunities for growth of company and
eliminate threats.
In this research report many types of organisations such as private, public and voluntary
are discussed and more over it their scope and objectives are also explained. Report contains that
main motive of private sector companies are profit maximisation and public sector companies
are to make their products available at cheaper rates to society for their welfare. After
considering this report various corrective measures can be taken by Unilever PLC to improve
their products and generate more profits.
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REFERENCES
Books and Journals:
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