Business Environment: Types of Organizations and Analysis Report

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This report provides a comprehensive analysis of the business environment, focusing on two organizations: BMW and Amnesty International. It begins by explaining different types of organizations and their legal structures, differentiating between private, public, and voluntary sectors. The report then explores the size and scope of different enterprises, examining factors such as employee numbers, market share, and annual turnover for both BMW and Amnesty International. It also describes the linkage between organizational functions and objectives, highlighting how these elements contribute to the overall structure. Furthermore, the study identifies the positive and negative influences of the macro environment on business operations, conducting both internal and external analyses to assess strengths, weaknesses, and their correlation with external factors. The report uses examples from BMW and Amnesty International to illustrate key concepts, providing insights into their operations, objectives, and responses to environmental changes. The report concludes with a summary of the findings and references relevant literature.
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BUSINESS AND BUSINESS ENVIRONMENT
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Table of Contents
Introduction...................................................................................................................... 3
Part 1................................................................................................................................4
P1 Explaining different types of organisation and its legal structures..............................4
P2 Explaining size and scope of different types of enterprises........................................7
P3 Describing linkage between functions of entities and in what way, they link up with
objectives as well as structure of organisation.................................................................9
Part 2..............................................................................................................................11
P4 Identifying positive and negative influence that macro environment leave upon
operations of business................................................................................................... 11
P5 Conducting internal as well as external analysis......................................................15
P6 Explaining in what way, strength and weakness correlate with macro factors that are
external.......................................................................................................................... 17
Conclusion..................................................................................................................... 18
Reference List................................................................................................................ 20
Appendices.................................................................................................................... 24
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Introduction
Business Environment implies the surroundings that enfold the operation of a business
organisation. That includes various internal and external factors that are already present
and are outside the control of the organisation but definitely affects the performance and
survival potentiality. A business has to operate in response to the changes in these
factors; hence the primary feature of a business environment is the non-static behavior,
unpredictability about the exact changes in the environment or future happenings. It is
multifaceted and has far reaching impacts, such that a single change in the behavior of
one organisation leads to an entire change in the whole market. A business
environment consists of the internal environment that exists within the company, the
external environment including the micro environment. In this study the student has
talked about the different type and scope of an organisation, the various purpose that it
serves, the relationships between different organizations and its nexus to the
organizational objectives, the advantages and disadvantages of macro environment on
the business operation and the analysis of the internal and external factors of an
organisation that helps to identify its strength and weakness. The study focuses on two
of the organizations, BMW (Bavarian Motor works) and Amnesty International.
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Part 1
P1 Explaining different types of organisation and its legal structures
An organisation is a formal setup with a definite objective. It is a hierarchical
representation of authority, whereby each of its members works together to achieve one
common goal. The various types of organisation can be understood with the different
purposes that they serve. There are Private and public sector enterprise; voluntary,
formal and informal organisation.
Private organizations- These are owned and controlled by private individuals with the
motive of profit maximization.
Public sector organizations- These are controlled by the government with the sole
objective of the welfare of the people
Voluntary organisation- Group of individuals come together to form an organisation and
work towards a common goal. These sectors perform social duty, towards the
betterment of the community, and are non-profit and non-governmental. These are the
third sector, in contrast to the private and the public sector having a direct relation to the
civic society (Guay, 2016, p156)
Amnesty International is a non-governmental voluntary organisation that works in the
field of human rights, work on issues of human rights and comply with the international
legal regulations to curb human rights violations. It mobilizes public opinion and
pressurizes the government to prevent further abuse of human rights. The six main
target areas have been women, children and minority; torture; death penalty; rights of
refugee and prisoners of conscience and protection of human dignity. Amnesty is
against capital punishment, and hence it campaigns against death penalty, ensure free
and fair trial and proper food and living conditions for the prisoners, free and compulsory
education for children, preventing abortion and recruitment of children in hazardous
work including child soldiers, preventing illegal killing and torture, promote social and
cultural rights for the marginalized community and LGBT and uphold the rights of the
refugees. It is a global organisation employing more than 2400 staff in over 70
countries. It is financed by donations from worldwide members only and not from any
governmental organizations to remain free from any political influence.
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The organisation has paid professionals along with worldwide voluntary members. In
countries having a strong influence, the members are divided into sections which
coordinate the activities. In countries where the presence is not much strong, people
can become voluntary members. International Secretariat is responsible for setting a
global agenda and carries out the daily work of Amnesty under the direction of the
International Board. It consists of 500 staff under the Secretary General. The
International Board takes decision for the organisation, implements the strategy laid
down by the International Council and ensures that the daily working complies with the
relevant laws. It has 8 members and an international treasurer. The International
Council, the senior most decision-making body, consists of a Chairperson and
representatives from International Board and country sections. It elects the members of
International Board, set the strategic goal and the policies of the organisation and
amend the Amnesty law. Apart from this hierarchical division, in 2013, Amnesty
launched the global council, which is a forum that brings people from various other
fields to work towards the common cause of human rights. More than 80 country
sections provide the funding and membership to Amnesty. These sections consist of
local groups like university students).
The Bavarian Motor works is the leading German automobile company founded in 1916.
It is the parent company of Rolls-Royce Motor Cars and it produces motorcars under
the ‘BMW Motorsport Division,’ Motorcycles under ‘BMW Motorrad’, and plug-in electric
cars. It offers efficient and dynamic luxurious cars with efficient engine emitting less
pollution. The most innovative model is the BMW iPerformance providing the most
efficient and smooth driving, having the three components of electric motor, lithium-ion
high durable battery and an intelligent energy management. It has followed the three
main objectives of Sustainability, Efficiency and Environmental Responsibility that has
made it unique from the rest companies. The Supervisory Board is the highest
authorized body, with 20 members under it divided into four committees of Personal,
Nomination, Audit and Mediation. Next is the Board of Management that controls the
BMW Group Compliance Committee consisting of six more departments. According to
the 2016 report, BMW has around 124,729 employees.
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Figure 3: The number of employees (2006 to 2016)
(Source: Bmw.co.uk.2017)
According to the Wall Street Journal, the annual revenue has been 94,163 in 2016,
92175 in 2015 and 80,401 in 2014. The gross annual income is 22,663 in 2016, 24,467
in 2015 and 22,639 in 2014. In 2014, BMW was ranked the second most valuable brand
globally reaching the brand value of 25.7 billion U.S Dollars. The global market share
grew from 2% in 2000 to 3% in 2014 (Bmw.co.uk, 2017)
Figure 4.BMW global market share from (2000 to 2014)
(Source: Bmw.co.uk. 2017)
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P2 Explaining size and scope of different types of enterprises
According to Becker (2017, p.2), every business venture need to expand their business
overseas in order to earn huge profit in long run of their businesses. BMW and Amnesty
International are two different types of organisation that serve different purposes of
society. Both these organisations have been serving people for a large number of years.
Amnesty International fights for human rights of people and provides them with justice
for betterment of this society. On the other hand, BMW is a manufacturer of world’s best
quality cars and is very popular across globe. Size and scope of both these ventures
are immensely high that is why; they are working day and night to meet expectations of
people. Ostos et al. (2017, p.62) mentioned that size of organisations can be
determined by examining its numbers of employees, market share and gross annual
turnover. Scope includes coverage of products in both national and international market.
Besides, service provisions are also included in scope of an organisation.
Size of BMW
Number of employees: This Company has provided employment to huge section of
people in society. Large section of people eagerly desires to work with this company
because it has made sustainable profit from its years of origin. It has been serving in
this sector for over 100 years. Employee number has crossed billions in this sector. It
has made glorifying performance in manufacturing cars and selling them in market.
Different innovation is being made in its quality of products for successful execution of
business.
Market Share: Schaper (2017, p.1085) commented that companies that have
maintained high margin of profit for its years of origin, is bound to earn great range of
share from market. Similarly, BMW too has attained success in field of car
manufacturing. It manufactures luxury vehicles, motorcycles and engines of cars.
Business execution is being done in a smooth manner therefore; it has succeeded in
gaining approx 6915 billions of profit in recent years.
Gross annual turnover: Decock and Spiessens (2017, p.77) mentioned that annual
turnover of organisations needs to be strong for ensuring huge profit in business
environment. BMW try to maintain great margin of annual turnover in order to conduct
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its business properly. As a result, it has succeeded in maintaining a paramount position
in international market.
Scope of BMW
Coverage in national and international market: This enterprise has very strong
control over both national and international market. It has started to expand its business
in foreign market since 1920s. As a result, it could manage to keep a strong hold in
international market and maintain huge competition in market.
Service provision: BMW has provided quality services to people, which cannot be
provided by other companies. This company has given warranty of one year in its
accessories of products. In addition to this, products of this venture provide immense
mileage that can never be given by other competitors. In this way, scope of this entity is
large in business environment.
Purpose of BMW: the purpose of BMW is to make and produce the automobiles in the
organization. It is evident that the support of the BMQW is in the building of the cars and
the services and the automobiles in the organization.
Size of Amnesty International
Number of employees: It is a non-governmental venture that serves people for
protecting their human rights. More than 7.5 million employees work under this
organisation along with several supporters. This makes them more active and they try to
deliver their best services for people.
Market Share: This enterprise has worked in this field for about 55 years. It has
supported rights of people at every step thereby, gaining huge popularity in market.
Several investors and supporters willingly support in this noble deed of this entity. As a
result, it has succeeded in maintaining good amount of market share in both national
and international markets.
Gross Annual Turnover: This Company can be able to fight for large sections of
people in society that has led to gain pioneer position in non-profit sector. That is why;
gross annual turnover has been increased greatly. Baumane-Vītoliņa et al. (2017, p.48)
opined that non-governmental organisations attain success when they can involve more
people under their support. This company has achieved such position in market.
Scope of Amnesty International
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Coverage in widespread arena: This enterprise has expanded their area of work in
several countries across globe. It tries to provide justice to people in such a way that
peace in world can be spread suitably. This company has also provided funds to various
organisations that are working for welfare of society. As a result, successful expansion
of business is being noticed in this entity.
Service provision: As per Artto et al. (2017, p.150), service provision in non-profit
ventures leads to attain their business goals and objectives. Since this firm fights for
human rights of people, it can be able to remove conflicts of people. This helps them to
build a healthy impression regarding their company among masses.
Purpose of Amnesty international: the purposed of Amnesty International is to make
sure that there is enough support to the people in the society It is clear tyhatb the view
of the Amnesty international is to grre4atly support the required and the minor group of
the people in the society to gain and access their rights and authority.
P3 Describing linkage between functions of entities and in what way,
they link up with objectives as well as structure of organisation
Kuznetsova and Markova (2017, p.450) explained that organisations have different
types of functions like HR functions, finance, sales as well as manufacturing, which
needs to performed accurately for ensuring beneficial outcomes. Every venture sets
their objectives before starting their business. This helps them to plan events of suitably
and develop proper structure in order to conduct work. In BMW, HR functions need to
be conducted properly for gaining advantages in business. HR department needs to be
very effective because based on their functions, profit can be ensured in business
environment of BMW. HR of this company is inclined towards attaining organisational
profit. This helps them to conduct their work properly for successful running of business.
Finance department of BMW looks after market revenue and profits accurately. This
department develops plan in what way, amount of profit can be increased by investing
fewer amounts.
As a result, finance needs to function properly in this entity as it guides this venture
towards its victory. Sales and production unit of every entity need to be very active so
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that company can reach numerous people with innovative items (Lampadarios et al.
2017, p.200). This company has set an objective to earn more by satisfying demands of
people. Sales department of this enterprise promotes their products conveniently.
Moreover, manufacturing department does not keep a flaw in their work for betterment
in quality of products generated. Organisational structure has been kept in such a way
that it would lead to bring success for this venture. Functions of this business house are
interrelated on each other. This lets them to shape structure of venture properly in order
to bring creativity in services provided to people. However, sometimes interrelations
create huge confusion in organisation thereby, developing weak structure of work in
enterprise.
That is why functioning of this enterprise has to be very operated duly so that profit
margin can be increased greatly. Kiyak and Pranckevičiūtė (2017, p.65) stated that non-
profit ventures maintain smooth structure in their workplace as it aids them to support
people properly. HR department of amnesty International works with other departments
accurately for proving beneficial for this entity. Finance part of this entity looks after in
what way, funds can be arranged for providing services to large number of people. It is
important to understand that employees of this venture need to work collectively for
guaranteeing excellence in work environment. Since it has to provide service to people,
it needs to work properly for gaining more success in business of this company.
Promotion of services of non-profit ventures is done by people, who use their services.
As a result, providing service to people is main area that is focused on mainly by these
organisations.
Being a service provider business house, every department of this entity works
collectively so that high quality services are provided to distressed people. Therefore,
structure of this enterprise will also be reformed when such activities occur. Apart from
this, complexities in structures of business can be removed when interrelation among
every function of enterprises occurs. Objectives of a public sector are that it provides
services to people for enhancing their living standards (Brunet-Thornton and Brunet-
Thornton, 2017, p.2). This organisation too serves people for such noble cause and has
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set their objectives accordingly. When interrelation occurs, it helps in adding victory to
this venture thereby, leading to growth.
Conclusion
From the above part it is evident that support of the business management of the
organization are in the terms of the better understanding of the situation which helps nin
the better development of the society and fior the society of the people.
Part 2
P4 Identifying positive and negative influence that macro environment
leave upon operations of business
Yang et al. (2017, p.256) informed that macro environment of business is done by
PESTLE analysis, which helps to know in what way; it has affected operations of
business.
The pestle analysis is the analysis that is used for the analysis of the business
environment in the organization. It is evident that the support of the Pestle analysis is in
terms of the situation, which is marked for the greater development of the organization.
The term PESTLE stands for Political, Economical, Social, Technological, Legal and
Environment
PESTLE analysis for BMW
Political Several rules and regulations have
been set for car industry for
stopping pollution (Lauring and
Bjerregaard, 2017, p.106). This
company had to comply with such
rules for better execution of
business.
Initiation of new scheme in UK has
led to manufacture large number of
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high mileage car thereby,
increasing in sales of BMW.
Economical Extra capacity of cars was being
produced, which give rise to
increased revenue in marketing.
There was great enhancement in
GDP of country that affected
business of BMW.
Exchange rate has been reduced
that led to trouble.
Social Pattern of purchasing of products
has been changed.
Awareness related to emission of
harmful gases has increased
enormously.
Customers wanted to buy fuel-
efficient cars, which changed arena
of business environment for BMW.
Technological BMW has used latest technology for
gaining extra advantage in
competition.
Sophisticated designs have been
incorporated in cars for increasing
rate of sale of cars.
This company has made changes in
its car designs so that less pollution
occurs.
Legal Several laws related to pollution
and contamination of air has
affected business of BMW.
Strict laws have been made in
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