HNC Business and Business Environment Report - Unit 1

This report provides a comprehensive analysis of the business environment, focusing on different types of organizations, their structures, and functions. It begins by defining the business environment and its impact on organizations. The report then delves into the types of organizations, including private, public, and voluntary sectors, and their respective purposes. It also examines the size and scope of various organizations, comparing examples like Coca-Cola, NHS, and British Heart Foundation. The report further explores the relationship between different organizational functions and their structures, as well as the impact of macro and micro environments on business objectives and decision-making. The report uses examples and case studies to illustrate these concepts, concluding with a summary of key findings and references to supporting literature.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Types and purposes of organisations................................................................................1
P2 Size and scope of different types of organisations............................................................2
D1 Critical analysis of complexities of different types of organisational structure...............4
TASK 2............................................................................................................................................4
P3 Relationship between different organisational functions..................................................4
TASK 3............................................................................................................................................5
P4 Covered under PPT...........................................................................................................5
D2 Impact of macro and micro environment on the business objectives and decision making. 5
TASK 4............................................................................................................................................6
P5 Covered under PPT...........................................................................................................6
P6 Covered under PPT...........................................................................................................6
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Business environment consists all the internal and external factors that may affect the
functioning of business of an organisation. Both the factors work together and influence
operational and executional activities of the company (Business Environment, 2018). It includes
competitors, customers, suppliers, government policies, social and economic trends, changes in
technology etc. Main objective of this report is to figures out that what factors may affect
businesses positively or negatively. This project consists purposes, size and scope of different
types of organisations, relationship between various organisational functions, positive and
negative impacts of macro environment. Internal and external environment of the organisation
and relationship of strengths and weaknesses with macro environment are also discussed under
this project report.
TASK 1
P1 Types and purposes of organisations
There are various type of organisations who are running their business in the market.
These organisations are explained below:
Private organisations: These are the organisations that are run by individuals and
companies with no interference of government. This sector is that part of national economy
which is totally managed and controlled by private enterprises.
Coca cola is private sector organisation which is a carbonated soft drink manufacturing
company and it was invented by John Pemberton in the 19th century.
Purpose: The main aim of private sector is to generate higher profits to survive in the
market as there are various competitors in the market. Objective of Coca cola is develop the
higher standards of corporate behaviour. Another purpose of the company is to acquire higher
market share with the help of its functions (Avramenko, 2012).
Public organisations: It includes such type of companies that are run, controlled and
monitored by the government. Funding for this sector is generated through various sources that
are taxes, government fees and other sources. The activities that are considered as the part of
public sector is related with police, military, transport, education and healthcare.
NHS is public sector company who is run by the government and provides services all
around the world. It provides medical services to the helpless people of the society.
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Purpose: Main objective of such type of organisations is to provide benefits to the
individuals of the society. Aim of NHS is to supply medical services to each and every poor
individual of the society. Another purpose of the company is to act as the voice of various health
providers to supply information related to health care policies (Bovee, Thill and Raina, 2016).
Voluntary organisations: Such type of organisations are working for social welfare not
for profits. All the activities of voluntary organisation are provided with the help of volunteers.
While forming such type of organisation it is important to take permission and follow all the
guidelines of government.
British Heart is charity organisation which is established in UK. It was founded by
medical professors who were concerned about the increasing death rate. Currently over 1000
projects are funded by them.
Purpose: The main aim of such type of organisations is to provide social services.
Purpose of British Heart is to reduce the increased death rate in UK. Another objective of this
organisation is to figure out the causes of cardiovascular disease and than provide appropriate
treatment to the persons who are suffering from the same (Cai and Yang, 2014).
P2 Size and scope of different types of organisations
The organisations that are explained below have different size and scope from each other.
All of them are working for assorted prospect and perform their activities according to their
perspective. Their size and scope are discussed as underneath:
Basis Coca Cola NHS British Heart
Background It is a part of one of
the famous and largest
companies in beverage
sector.
It is part of health and
social care service
industry that provides
services to the poor
individuals.
It is a group of
medical professional
and a non profit
organisation.
Product and service it offers different types
of cold drinks to the
customers which
includes sodas, energy
and soy based drinks
It provides health and
care services to the
helpless people of the
society.
Provides medical
services to the persons
who are fighting with
cardiovascular.
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Mission and objective The main mission of
Coca Cola is to refresh
the world in body,
mind and spirit.
Objective of the
organisation is to be
on the top of the
beverage industry.
The main objective of
the company is to
provide services to
every poor person so
that they may live a
healthy life.
The mission of the
organisation is to win
the battle against the
disease called
cardiovascular.
Company's size and
scope
Coca Cola is a large
scale company and it
is a part of beverage
sector and running its
business globally
It is the part of 10
world's largest
employers and running
its business in health
and care sector.
It is a large scale
organisation and
provides services all
over UK. It is a
charitable foundation
and part of non profit
organisations.
Organisation and
legal structure
Partnership, sole
proprietorship and
limited companies are
the legal structure of
private companies.
Partnership is a type of
business which is
formed by a group of
individuals for the
purpose of gaining
profits. Sole
proprietorship is a type
of business which is
run by a single person.
In limited companies
Central government,
state government and
local government.
Central government
provides guidelines to
all the companies to
run their business.
State government keep
and eye on the
activities of state level
agencies. Local
government are liable
to track functioning of
public organisation's
operations (Chavis,
Unincorporated
association, trust and
company limited by
guarantee.
Unincorporated
association is a small
group of members
who are working to
achieve short term
goals. Trust is a
combination of
different persons who
provide funds to
voluntary
organizations.
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liabilities of all the
members are
restricted.
Klapper and Love,
2011).
Company limited by
guarantee there are no
shareholders and no
profits get invested
again in the company.
Stakeholders Major stakeholders of
Coca Cola are
customers, suppliers,
bottlers and
government.
Patients, government
and investors are the
stakeholders of NHS.
Trustees, managers
and government are
the stakeholders of
British Heart.
D1 Critical analysis of complexities of different types of organisational structure
There are various complexities in the organisational structures of private, public and
voluntary sectors. Main objective of private sector is to generate profit hence their financial
statements are much complex as compare to other two sectors as they are concerned with society
developments. All the departments of organisations are interrelated as they communicate and
provide information to each other so that business can be operated effectively. For example as
finance department is liable to assign funds to all the departments, research department provide
information of market to the marketing division.
TASK 2
P3 Relationship between different organisational functions
An organisation who is runn9ing its business in the market have various objectives to be
attained. Coca cola is also having it objectives that are explained below:
 Customer satisfaction: This is the major objective of Coca Cola as if customers get
satisfied than company will be able to acquire more market share (Commander and
Svejnar, 2011).
 Profit maximisation: Another objective of the company is to maximise profits which is
possible if the first objective is achieved by the organisation.
Structure of the organisation: There are different types of organisational structures that
are explained below:
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 Divisional: this type of structure is used by the large organisation in order to cover
geographic area. It facilitates the communication among different departments of a
company
 Functional: This structure is used by the companies to run all the marketing, sales and
other activities effectively and smoothly in order to achieve organisational goals.
 Matrix: This structure is used by multinational companies which is a combination of
both above mentioned structures.
Coca Cola has established divisional structure within the organisation as it can help to
attain organisational goals.
Relationship of organisational functions and objectives and structure of the company:
 Design and production function: this function is run by different departments of the
company as they have to attain more and more customers. If the production is well
managed than it may help to attract more customers and satisfy them by providing good
products (Cuervo‐Cazurra, 2011).
 Sales and marketing function: this function can lead the organisation toward success
and help to attain the goal of profit maximisation which is very important to be achieved.
If the departments have proper communication and the have a planned marketing
activities than this may result in favour of the company (Gebauer, Paiola and Edvardsson,
2012).
TASK 3
P4 Covered under PPT
D2 Impact of macro and micro environment on the business objectives and decision making
Macro and micro environment affect the decisions making and objectives of the company
as they directly affect the performance of the organisation. There are various policies imposed by
the government every year that may affect the decision because now the company have to make
decision according to the policy. Investors of the organisation also affect the decisions and
objectives because they provide funds to the company that may help to run the business
smoothly and attain the objectives.
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TASK 4
P5 Covered under PPT
P6 Covered under PPT
CONCLUSION
From the above project report it has been concluded that, business environment refers to
the factors that may affect the operations of an organisation. It is essential for a company to
analyse all these factors to identify strengths and weaknesses in order to successfully run the
business. PESTLE and SWOT analysis can help to analyse all such type of factors.
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REFERENCES
Books and Journals:
Avramenko, A., 2012. Enhancing students' employability through business simulation.
Education+ Training. 54(5). pp.355-367.
Bovee, C. L., Thill, J. V. and Raina, R. L., 2016. Business communication today. Pearson
Education India.
Cai, S. and Yang, Z., 2014. On the relationship between business environment and competitive
priorities: The role of performance frontiers. International Journal of Production
Economics.151. pp.131-145.
Chavis, L.W., Klapper, L.F. and Love, I., 2011. The impact of the business environment on
young firm financing. The world bank economic review. 25(3). pp.486-507.
Commander, S. and Svejnar, J., 2011. Business environment, exports, ownership, and firm
performance. The Review of Economics and Statistics.93(1). pp.309-337.
Cuervo‐Cazurra, A., 2011. Global strategy and global business environment: the direct and
indirect influences of the home country on a firm's global strategy. Global Strategy
Journal.1(3‐4). pp.382-386.
Gebauer, H., Paiola, M. and Edvardsson, B., 2010. Service business development in small and
medium capital goods manufacturing companies. Managing Service Quality: An
International Journal. 20(2). pp.123-139.
Online
Business Environment. 2018. [Online]. Available through:
<http://www.economicsdiscussion.net/business-environment/business-environment-
types-external-micro-and-external-macro/10095>
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