Business and the Business Environment: Report for [University Name]

This report provides a comprehensive overview of the business environment, exploring different types of organizations, including public, private, and voluntary sectors, along with their legal structures, size, and scope. It delves into the relationship between various organizational functions, such as HR, finance, and research and development, and how they contribute to achieving organizational objectives and structures. The report further examines the positive and negative impacts of the macro environment on business operations, utilizing PESTLE, SWOT, and TOWS models to analyze the internal and external environments of specific organizations, with a focus on Tesco. The analysis highlights the interrelationships between strengths, weaknesses, and external macro factors, providing insights into strategic decision-making within the business context.

Business and the
Business Environment

Table of Contents
Table of Contents.............................................................................................................................2
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1. Explain different types and purposes of organisations; public, private and voluntary sectors
and legal structures......................................................................................................................3
P2, Explain the size and scope of a range of different types of organisations............................6
TASK 2............................................................................................................................................7
P3. Explain the relationship between different organisational functions and how they link to
organisational objectives and structure........................................................................................7
TASK 3............................................................................................................................................8
P4. Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples................................................................................8
TASK 4..........................................................................................................................................10
P5. Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses..........................................................................................................10
P6, Explain how strengths and weaknesses interrelate with external macro factors.................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Business is a mixture of different settings and events including some commercial activities
which are performed and executed by companies or individuals as entrepreneurs for motive of
profits and attaining the strategic objectives by following all the legal structure and operational
guidelines (Alotaibi and Liu, 2017). The Report is divided into two separate parts in which the
first segment highlights different types of organisation that exist in the marketplace with their
purpose and legal structures and also elaborate on their size and scope. Several functions and
their interrelationship that are present in the organisation are also evaluated. The second part of
the report is developed on Tesco which is a supermarket store in United kingdoms developed in
1919 by Jack Cohen. The Macro environment of a company is evaluated their PESTLE, SWOT
and TOWS model is utilised for understanding the internal and external business environment
and knowing the interrelationship among them.
TASK 1
P1. Explain different types and purposes of organisations; public, private and voluntary sectors
and legal structures
Meaning of a Business Organisation:
Business organisation is a term that defines a structure and objective of a specific entity that is
developed according to be plans and overall external and internal business environment. Every
general business is the signed with the focus over two specific objectives that is of earning higher
profits and moving towards growth and success by spreading awareness and making that are
present in the society. There are numerous types and categories of businesses which are being
run in the environment. These business organisations are defined below:
Types of Business Organisation:
 Sole Traders are individuals single handily set up their business which is known as sole
proprietorship where the ownership and control of all the business related activities are in
hands of single person who is not a separate from the business. In other words an
individual who is running their own businesses are known as a sole traders who are
responsible and liable for all the liabilities and enjoy the benefits earned.
 Partnerships is a business setting that is developed by efforts of more than two parties
who are known as partners. The relationship between partners is governed and regulated

with the help of a partnership deed also known as an agreement which are signed by all
the parties involved in the partnership business which define their specific scope and
structure of the partnership along with representing all the responsibilities and role of
each partner and their capital investment ratio.
 Private Sector organisation are privately held businesses which are initially started with
the smaller level holding small size and scope but with growth and success changes into a
large organisation. A privately owned business is small on initial level and therefore there
are less than 50 shareholders involved in the business according to United Kingdom the
entity is not allowed to trade there shares publicly not even able to exercise any trading
activities on any stock exchange. Hilton Hotel is a good example of a private organisation
which is dealing at international level. Specifically, the size of a private sector business
organisation can be both small and huge based on the business which is performed by the
organisation or it also depends on the market in which it is performing like it is local,
national or International. Tesco PLC is considered to be a public organisation which also
run as a private one because its shares can be owned by public as well. Size specifically
based on the different levels like local, national or international, in which a public
organisation is performing. On the other hand, the scope of an organisation within private
sector is to earn maximum level of earnings through specifically delivering required
services to the customers and clients. Including this, the goal private organisation like
Hilton hotel is to to become the leader throughout meaning high profit margins within the
industry in which it is performing like hospitality sector.
 Public Sector Organisation are most commonly limited liability companies which has
the power to sell their shares in stock market and conduct appropriate sharing activities
with the help of available stock exchange. Private sector organisation unnecessarily have
to maintain a minimum capital of £50,000 in United Kingdom and are also responsible
for failing their financial returns and records every 12 months by following the respective
accounting principles. Over public sector organisations have to get their certificate after
reading from Companies House before conducting any share exchange activities
(Alotaibi, 2016). Crown prosecution is said to be a public sector organisation which
specifically helps different individuals with legal issues. Crown prosecution is
performing at national level therefore it has great number of employees that are dealing

with different legal issues. Goal of a public sector organisation is to embrace the living
standards of civilians of a country.
 Not for Profit Organisation (Voluntary) are the businesses which are set up in the
market with a very different objective from other business entities that is not related with
any financial gain and earning profits bringing change in public and in society by
providing services to those who are unable to have appropriate opportunities for
completing their daily requirements. In present context, Oxfam can be considered as a
good example of a not for profit organisation, which also so consider as a charity
organisation that helps people who are in need. Goal of a voluntary organisation is to
specifically help the people who are in need like vulnerable. Scope of this organisation is
to improve the living standards of a group, community or the society. Basically, the size
can be both small and large in numbers based on the the area in which a non-profit
organisation is dealing.
Difference in Types of Business Organisations:
BASIS PROFIT
ORGANISATION
PRIVATE
ORGANISATION
VOLUNTARY
PURPOSE The purpose of public
sector enterprises as
they are government
bodies that to seek to
deliver appropriate
goods and services to
to people including
military, police,
public, infrastructure
and other for benefit
of society.
The private
organisations are the
integral part of
country's economic
systems which are
privately owned by
individuals and group
of people and running
the operations for
profit making.
privately owned
organisations are an
important source of
growth and
development and
The sole purpose and
initiative of voluntary
organisation is to
provide benefits to the
society by enriching it
and without any
expectations of
returns and profit. the
voluntary organisation
also create social
wealth and works for
benefit and
improvement of the
society.

generation of per
capita income of
country along with
widening the
countries GDP
(Batocchio, Ghezzi
and Rangone, 2016).
SET UP FOR Example of Virgin
mobile as a public
owned company and
one is the leading UK
Challenger banks. The
focus of virgin
mobiles is laid on the
approach which seat
to offer a good value
to the customers by
delivering a positive
contribution towards
the society.
Tesco is the best
example of a private
Organisation in
United Kingdom.
Tesco is the British
multinational retail
company which has
been sitting to lay
emphasis on
generating a huge
range of revenue and
income by opening a
competitive advantage
of its own.
Cancer research UK is
a voluntary
organisation and they
provide social
services by
conducting research
and campaigns for
preventing cancer
from the society and
spreading awareness
amongst people.
P2, Explain the size and scope of a range of different types of organisations
Difference between Micro, Small, Medium and Large Organisation:
BASIS MICRO
ORGANISATION
SMALL
ORGANISATION
MEDIUM AND
LARGE
ORGANISATION
Size Micro Enterprises are
small business sectors
where employment level
Small business
Enterprises are owned by
independent bodies and
Medium and large
organisation includes
those employees working

is very low and with low
investment capital (Belas
and et. al., 2018).
small number of workers
is involved in it seeking
to enhance their business
activities and operations
in order to for long run
and increasing their sales
volume.
as voluntary membership
and mostly involves the
multinational bodies
holding the possibility of
increasing their growth
on a very fast scale.
Scope The scope of micro
business organisation is
in developing countries
as they constitute of this
type of enterprises in
large number there all the
necessities are compelled
by micro businesses
adding value to the
economy and buy
domain there in scope for
better income and
opportunities.
The small size businesses
privately owned
businesses mostly sole
proprietors working in
partnerships holding a
chance of bearing in their
sizes and revenue
structure by capturing
appropriate opportunities.
Medium and large
organisation includes
multinational businesses
that work as a part of
government sector and
thereby earning huge
profits. The capital is
kept aside for future
developmental purposes
for seeking to develop
internal aspects of
company.
Number of
employees
10 or less 50 or less 250 or less
Goals Goal of a micro level
organisation is too on
enough to fulfil daily
needs or to survive
within today's
competitive market.
Goal of a small
organisation can be the
same as micro level
companies but the major
difference is they
specifically earns more
than the micro ones.
Goals can be different of
both medium and large
level organisations
because, some may have
to become a leader within
the area in which they are
performing and some of
others might not stop
themselves by their only

but to earn maximum
profits through
expanding business at
International or National
level.
TASK 2
P3. Explain the relationship between different organisational functions and how they link to
organisational objectives and structure.
In previous sections it has been identified that there are different types of business organisations
that is Private, Public and Voluntary. This business organisations are of different sizes and scope
which are separating them from each other into Micro, Small, Medium and Large businesses and
also their business legal structure and objectives differentiate from one another. Every
organisation which exist in the marketplace have different functions which ones integrated and
complete their respective task contributes to the ultimate organisational goals and objectives with
the help of strategical means. Tesco is a privately owned entity and considered as one of the
largest retailer in United Kingdom holding several operations and departmental units as it is a
multinational organisation which is diversifying into different geographical locations serving to
customers with its numerous stores.
Organisational functions:
 HR department: Tesco PLC, already has an effective HR department which helps
company in recruiting the best employees based on their qualifications and skills who fits
the vacant seats within the company.
 Finance department: This is said to be the Primal department of Tesco PLC because
this department looks into financial books and keeps an eye on all the expenses and profit
margins that takes place every year.
 Research and development Department: Another crucial organizational function of
Tesco PLC, which helps in analysing the market and pulling out the information about
different trends that took place which helps in taking right decisions in order to grab the
competitive advantages within Retail industry.

Organisational structure: The organisational structure which has been followed by Tesco PLC
is hierarchical, which helps company in in rotating the information in a systematic way.
Under this section the organisational functions of Tesco are elaborated along with their
interrelationship with one another (Chaouk, Pagliari and Moxon, 2020).
 Sales and Marketing department- Sales department of Tesco is considered as one of
the most important and essential operational unit because the nature of the business entity
is of retail running in a competitive environment. Therefore revenue generation is one of
the biggest objective of the company and which is fulfilled by sales department of Tesco.
Marketing department of Tesco is responsible for several tasks from conducting a market
research to building a good brand image of the company in market places to conducting
appropriate promotional actions for Tesco. both sales and marketing department of Tesco
and their tasks are interlinked because according to the market research conducted by
marketing unit and strategic and plans and promotional actions taken by them the sales
department and sales individuals develop there sales strategy. It is important that both the
departmental units are effectively communicating with one another and integrating the
task for bringing a alliance in between there external communication with customers.
 Human resource and Marketing department- The Human resource Department of
Tesco a vital role in the organisation with the most appropriate and talented workforce
also by fulfilling the manpower needs of company. Human resource Department
undertakes recruitment and selection activities on behalf of Tesco for bringing the best
experts and developing appropriate operational teams. Marketing and Human resource
Departments tasks are interlinked as the HRM unit will bring the most export marketing
individual for the company. therefore it is very important that both the department in
units are communicating with one another and fulfilling each others requirements so that
the best people can be attracted and employed by Tesco.
TASK 3
P4. Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples.
Micro environment refers to the external business environment of an organisation which
influences and impacts several activities and decisions of company. Therefore, PESTEL analysis

tool is utilised for Tesco to understand all the external factors that are influencing business and
operations. PESTEL analysis have six elements which are considered as the key drivers of
change leading to respective threats and opportunities available in front of the business existing
in the external business environment.
 Political- Tesco is a supermarket Store in Retail industry holding its headquarters in
United kingdoms but operates through more than 12 to 15 other countries leave it
exposed to many political elements that can affect the operations and objectives of Tesco.
The European union referendum is causing a huge risk for Tesco in relation with the
investors and that is imposing a negative impacts on the business. Also currently the UK's
political environment is unstable that also imposes a threat and negative impact causing
huge political issues which are rising constantly (Chattopadhyay and Bhawsar, 2017).
Positive: Rather than focusing on United Kingdom’s market, Tesco PLC may effectively
take into consideration of different growing markets where it can expand its business
which would be really very helpful from going through the impact of Brexit.
Negative: The negative impact that came in front due to Brexit was that the market
become open which was considered to be the Primal chance for many foreign business
organisations to start performing within United Kingdom which can be taken as a threat
for Tesco PLC.
 Economic- Currently in United Kingdom there are two specific factors that are
negatively impacting the economy which is initialisation of BREXIT deal and outbreak
of covid-19 due to coronavirus. It implies that domestic businesses of United Kingdom
are severely affected because of the two significant reasons and therefore Tesco is also
being negatively impacted due to this economic issues. The economy of United Kingdom
is becoming unstable and unpredictable which is causing a threat on Tesco and its
operation specifically on profitability and revenue standards of the entity.
Positive: Specifically, outbreak of novel coronavirus also brought ample number of
opportunities for Tesco where it can spread its business through online platforms which
will not only help company in getting attention of new customers but it will also help
existing customers to be loyal.

Negative: Many of the supermarket in United Kingdom and different stores were kept
close due to outbreak of pandemic COVID-19, which impacted negatively on
productivity and profitability of Tesco PLC.
 Social- The social environment around the globe and more prominently in United
Kingdom is unstable and unpredictable because of the regular dynamic changes taking
place in customer trends and in overall business operations. Therefore it is not easy to
analyse the impact of social factors on Tesco. But the people of United Kingdom are
considered as loyal customers and which is a beneficial element of social external
environment which is causing a positive impact on Tesco in such conditions as well.
Positive: Organic products are offered by Tesco PLC within its super market which can
be considered as a positive impact on brand image of the company in front of the society
and its potential customers.
Negative: Due to greenwashing act, Tesco PLC might go through different range of
problems and can shift the interest of of loyal customers towards the other business
organisations that are offering the same sort of alternative products just like Tesco PLC.
 Technological- The super store Tesco is an organisation that always keeps up with the
regular updates and changes taking place in the technological market. Tesco always
moves towards bringing innovative changes in the organisation by influencing the
technological factors and making them a competitive advantage of the company.
Therefore, technology is one of the positive external factor that is being imposed on a
Tesco. Marketing department of Tesco is one of the most appropriate unit which is being
benefited with involvement of technologies as it provided them an appropriate
opportunity for conducting marketing activities in very small amount and resources.
Positive: Technology has held Tesco PLC in in performing financial transactions in much
more easier way through electronic fund transfer and so on.
Negative: Due to price and Technology, cyber bullying and cyber threat has also
increased which might impact upon company's image in front of the whole market and its
potential customers as well.
 Legal- The legal factor is related with political element fixing over the areas where law is
changed and which can change the business performance and its objectives. Complete the
legal structure and code of conduct of United Kingdom is not stable as political parties

and governments are not stable as well and this is the result of BREXIT. External legal
environment of United Kingdom and the laws are regularly changing on the other hand
the new laws are becoming very difficult for companies to understand and impose
drinking more complexities and difficulties along with use uncertainty in results for
Tesco (Fernandes, 2017).
Positive: This primal benefit is that following the code of conduct of United Kingdom
and of other countries, Tesco PLC can easily perform its operations in an ethical way
which will put positive impact on its brand image at International or National level.
Negative: Any sort of misconduct like breaching of any rule or code of conduct may
directly impact negatively on company’s brand image.
 Environmental- The last and the most recent external environmental tractor which is
been identified and enquired is environment. This element focus is over contribution
Tesco is making keeping the environment clean and returning a little bit to the society
from which company are using several resources. Tesco is an organisation which is
committed enough towards renewable resources and means of operations keeping the
business activities sustainable. The four environmental factor has positive impact on the
performance and operations of Tesco.
Positive: Developing policy like proper utilisation of recycled products and bring
customers with recycled carry bags would not only build up the trust of customers but it
will also positively impact on natural environment and save it for the next generations.
Negative: Following all the policies in relation to renewable resources are directly
impacting upon Tesco PLC's profit margins.