Business and Business Environment: Tesco, NHS, Oxfam Report Analysis

This report provides a comprehensive analysis of the business environments of Tesco, the National Health Service (NHS), and Oxfam. It begins by discussing the purpose and legal structures of different types of businesses, including private, public, and voluntary organizations, using Tesco, NHS, and Oxfam as examples. The report then analyzes the scope and size of these businesses, linking their structures to their objectives. It describes the link between different business functions and their connection to business objectives and structure. The report explores the impact of the external environment on business activities, using the PESTEL model to analyze the macro environment. It performs external and internal analyses of the companies to identify strengths, weaknesses, and their relationship with macro environmental factors, using SWOT analysis to explain their influence on decision-making. The report concludes with an assessment of the impact of macro and micro factors on business objectives and decision-making.

Business and Business
Environment
1

Table of Contents
Table of Contents...........................................................................................................................2
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK 1............................................................................................................................................3
P1 Discuss purpose and types of businesses along with their legal structures.......................3
P2 analyse the scope and size of different types of businesses..............................................5
M1 Assess how the structure, size and scope of companies links to business objectives......7
TASK 2............................................................................................................................................7
P3 describe the link between different business functions and explain how they link with the
businesses objectives and structure........................................................................................7
M2 Advantages and disadvantage of interrelationship between organisational functions.....9
D1 Complexities of business structure and interrelationship of organisational functions.....9
TASK 3............................................................................................................................................9
P4 Evaluate the negative and positive impacts of external environment on the business
activities..................................................................................................................................9
M3 Use PESTEL model to analyse the macro environment in the company......................11
TASK 4..........................................................................................................................................11
P5 Perform external and internal analysis of specific companies in order to identify their
strengths and weaknesses.....................................................................................................11
P6 Evaluate how weaknesses and strengths relate with macro environmental factors........12
M4 Use SWOT analysis and explain how they influence in decision making....................14
D2 Impact of macro and micro factors on the business objectives and decision making....14
CONCLUSION..............................................................................................................................15
References:.....................................................................................................................................16
Books and Journals...............................................................................................................16
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INTRODUCTION
Business environment are the factors that can have a direct impact on the workings as well as on
the operations of the company. They factors can be both internal and external factors and can
influence the environment of the company in which they are working. The analysis of these
factors will help the company in gaining competitors advantage in the market (Agwu, M.E.,
2018.). In context to Tesco, it is a British multinational retailer dealing in groceries and
merchandises. The company was founded by Jack Cohen, in the year 1919. the company is
headquartered in Welwyn Garden City, England and has its presence in more than 11 countries.
In case of National Health Service, is a publicly funded healthcare system. The organization was
incorporated in the year 1948 and since then they were funded by general taxation. The aim of
the company is to provide healthcare on the basis of clinical needs and not on the basis of ability
to pay. In reference to Oxfam, it is a collaboration of 20 charitable organizations that have come
together to fight injustice and to alleviate global poverty. The organization was incorporated in
the year 1942 and led by Oxfam internationals. The company comes under the category of
international NGO and is headquartered in Nairobi, Kenya. The major focus of the company is
on poverty eradication, advocacy, disaster relief, pro migration, policy research. In the given
report the purpose and the legal structure of the companies are given. Also their external in
internal factors analysis is given.
MAIN BODY
TASK 1
P1 Discuss purpose and types of businesses along with their legal structures
Private organisation: the private sector firms has contributed the mist in the economy. These
organizations have a prime goal of earning profits and will work towards maximizing profits
(Arnold and et. al., 2019.). These companies have their own rules and regulations for the
internal management of the company
Example: Tesco
Purpose: The purpose of the company is to provide better living to the customers in an
affordable way. The core purpose of the company is to serve their customers a little better
every day.
Legal Structures:
3

Sole Proprietorship: this type of business have a single owner. The company is managed and
controlled by an individual and that individual are responsible for the profits and losses of
the company (Bedi, H.S., 2019.). This type of company requires least number of
documentation which is why they are the simplest when it comes to incorporation.
Partnership: These organizations are managed and owned by at least two people but not more
than twenty people. The owners are refers to as partner and they are jointly responsible for
the profits and losses of the organization according to their agreed share. The powers of the
partners are also on the basis of the agreement.
Corporation: This type of business are formed by a group of people who are interested in that
particular business (Beynon-Davies, P., 2019.). The owners of the corporations are generally
the employees of the organizations and incorporation of these organizations requires large
number of paper work as the organization have separate legal entity.
Public Organisation: These organizations are controlled by government as they acquire more
than 50% of shares of the company. The aim of the company is to serve to people and not to
earn profits. They are focused on serving general people according to the instructions of the
government.
Example: National Health Services (NHS)
Purpose: The purpose of the organization is to provide quality healthcare facilities at lower rates
and to provide care for those who are in need instead of those who have money.
Legal Structures:
Central Government: Central government have responsibility and authority for the laws and
workings of the entire nation (Bill and et. al., 2020.). The company will get their budget
from Central government and have to work according to their instructions and with their
approval.
State Government: State government are responsible for the smooth functioning of the state and
will have authority and responsibility of the companies that are under state government.
Local Government: These are the government that works for the financing and interpersonal
elements of the new industries and are responsible for assisting companies by adhering o the
provisions of the Local Government Act 1972.
4

Voluntary Organisation: These are the organizations that are formed by individuals or group of
individuals in order to provide welfare services to the community and in order to provide
best services to the people who are in need (Blachetta, M. and Kleinaltenkamp, M., 2019.).
These organizations can be a group of charitable trust who are willing to help people and
wants to reduce inequality and injustice from the society.
Example: Oxfam
Purpose: The major purpose of the organization is to end injustice of poverty and help people,
save lives in disasters. They also help people to build better future for themselves. The
company works for human rights, trade justice, fair trade, education, livelihood, democracy,
etc.
Legal Structures:
Trust: this is a type of charitable organizations that are controlled and administered by member
who are known as trustees (Boone and et. al., 2019.). These organizations does not have any
regulatory structure so its is regulated by charity deeds. The charity deeds are highly flexible
and can be modified according to the needs.
Unincorporated Association: A group of individuals can create this organization and can do
operations in this. These organizations are not specified by the constitution and the
organizations are not incorporated legally.
P2 analyse the scope and size of different types of businesses
Basis Tesco NHS Oxfam
Vision The vision statement
of the company
states that the
company wants to be
the most valued
business by their
shareholders, the
communities in
which they operate,
the customers they
The vision of this
organization is to
deliver better health,
better value and
better care. The
vision of the
company starts an
aim to provide best
in class healthcare to
the communities
The company wants
to be committed
towards their work
so that they can be
known for their
integrity (Budhwar
and et. al., 2019.).
The company wants
to transform
operational structure,
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serves and the
committed and loyal
colleagues. It is clear
that the company
wants to provide
satisfaction to the
stakeholders.
through individual
efforts and
population wide
initiatives and to
prevent people from
serious illness and
try their best to keep
people well.
governance,
management and to
provide a culture of
reflection and
continuous learning.
Mission The mission
statement of the
company states that
“we make what
matters better,
together.” the
statement makes it
clear that the
company value
everyone’s
contribution in the
success of the
company.
The mission of the
company is to
provide quality
healthcare to each
and every person
who are in need
every day
(Carracedo and et.
al., 2021.). The
company intent to
provide care to
people who are in
need.
The mission
statement of the
company states that
they are ready to
fight with
inequalities and
injustice in order to
end poverty and
encourage justice.
Size and scope The company is the
third largest retailers
in the world in
context to gross
revenues (Cristofaro,
M., 2020.). They
have more than 7000
shops currently and
have a wide range of
products. The
The organization is
he worlds largest
non-military public
organization and the
organization have
one million patients
each day. The
company has 1.7
billion staff
members which
The organization is a
collaboration or
confederation of
twenty individual
charitable
organization with a
focus of elevating
global poverty. The
organization is a non
profit group with a
6

company have the
company has 24.8%
market share in
groceries market in
United Kingdom.
makes them world’s
fifth largest
employer.
collection of
operations.
M1 Assess how the structure, size and scope of companies links to business objectives
The size and structure of the companies are directly linked with the business objectives and the
development of the products and services. The companies which are large in size and structure
their objectives will also be based on such way (Guo and et. al., 2018.). The structure of the
organisation means the flexibility which have been provided to the employees and on the other
hand the scope of the company will depend on the what are the objectives of the company. The
good quality of products and services will be offered by those companies which are large in size
as they make good investment.
TASK 2
P3 describe the link between different business functions and explain how they link with the
businesses objectives and structure
Every organization has a specific structure through which the operations of the company takes
place. It is the structure by which rules and responsibilities have been allocated to the
management of the organization. It tells the employees about the work they are expected to do
also to the one whom they are going to report their work (Harrison, R. and et. al., 2018.). Tesco
is one of the largest retailer in the world and have approximately 423,092 employees who needs
a proper structure in order to have efficient management of the tasks as well as of the roles. NHS
are he fifth largest employer in the world with 1.7 billion employee working in the organization
it is important for the organization to follow the structure. Lastly Oxfam is a collaboration of 20
charitable organizations and management of those organizations can be very difficult or
impossible without a proper structure.
 Hierarchical organization structure- These are the most common type of
organizational structure in private companies. In this type of structure that management
have three levels I.e top level management, middle level and lower level. In this type of
7

structure the roles and responsibilities are easily delivered to each and every employee of
the company and most of the authority is in the hands of to level management who are
responsible for the decision making process of the company.
 Functional organisation structure- This type of structure is similar to the hierarchical
structure but the major difference in this structure is that the responsibilities and the level
of management is decided solely on the basis of the skills that the individual have (Hui
and et. al., 2018.). In context to NHS, the company is providing healthcare to the people
and believe in giving treatment on the basis of clinical advice and not on the basis of
money that the individual have.
 Horizontal or flat organization structure- This structure have only two level of
management which is the top level and the staff. The staff has the authority to convey
their problems, situations and queries directly to the top level management without any
middle men. In context to Oxfam, the company is having a collaboration of 20 charitable
organization and it is important for the organization to have less levels of management.
Tesco is one of the largest retailers in the world which provides groceries and merchandises to a
large amount of people. They are famous for their affordable and good quality products and the
organization is divided into different departments such as,
 Marketing and sales department- Marketing department of the company is responsible
for the promotion of the products of the company effectively and efficiently (Iglesias and
et. al., 2020.). The marketing department helps the company to attract potential
customers. The sales department of the company are responsible for the activities that are
related to selling of the products of the company.
 Human resource and Accounts- The human resource department of the company helps
in finding the right person for the right job in the organization. They help the company in
creating a pool of talent which is essential for the company. The accounts department of
the company helps in maintaining the books of account or the financial records of the
company which is an essential task that every company have to do.
M2 Advantages and disadvantage of interrelationship between organisational functions
There are different department in the company which have different role and duty and all the
department which works in the organisation are directly linked with one another. The structure of
8

the organisation is also made on the basis of the functions of the company (Ilin and et. al., 2018,
December.). Sometimes the interrelationship of the organisational functions creates the problem
of conflicts.
D1 Complexities of business structure and interrelationship of organisational functions
The business structures are helpful in defining the duties and responsibilities of the employees. If
the business structure of any company is complex and does not provide any flexibility then it
would become difficult for the employees (Kaipainen and et. al., 2021, June.). Interrelationship
of different organisational functions creates problem as the employees of different department
does not want to make cooperation with the other departments.
TASK 3
P4 Evaluate the negative and positive impacts of external environment on the business activities
PESTEL analysis includes the external factors in the environment which can affect the workings
of the company. It is important for the companies to analyse their macro environmental factors
from time to time or when entering into any new market.
 Political factors- these are the factors that are related to the degree of interference that
the government can do in the workings of the market or in the free market. In context to
Tesco, they are having their presence in more than 5 countries and political environment
of the countries greatly influence the management of the company (Liao, S.H. and Yang,
L.L., 2020.). It includes government policy, political stability or instability, corruption,
foreign trade policy, tax policy, labour law, environmental law and trade restrictions.The
positive impact that these factors can have are political stability in the market and
negative impacts can be trade barriers imposed by the government due to Brexit.
 Economic factors- These are the factors that tells the company about the economic
performance of a company especially when the company is going to enter a new market.
It includes inflation rates, exchange rates, disposable income of consumers, employment
rates, etc. These factors can also change the demand and supply models of the economy
resulting in which the company may have to revise their prices of goods and services.
The impact that the company can have is towards the accessibility of finance. Changes in
economical conditions can directly affect the finances of the company.
9

Internationalization and diversification are the positive impact as they are the reason for
the success of the company.
 Social factors- It is essential for the companies to follow these norms in order to
operate (Lim, W.M., 2018.). The positive impact of this factor is that the company can
have talented employees from that community and the negative impact is that the people
of the society is concerned more about sustainability which can hinder the growth of the
company.
 Technological factors- these are the factors that are concerned with the upgraded or
innovative technology that is prevailing in the market or is owned by any competitor.
The positive impact of this factors is that the company can work more efficiently and
effectively because of technological systems and the negative impact is that upgradation
of technology involves cost which is high and the technology can become obsolete very
easily which is again a disadvantage for the company.
 Environmental factors- These are the factors that are important for the environment and
are came into light because of the scarcity of resources, pollution targets, etc (Ma and et.
al., 2020.). In context to Tesco, the company is trying and making efforts to reduce their
carbon footprints by 50%. also the company is minimizing the plastic waste of their
stores by encouraging cloth or paper packaging. The positive impact is that the company
is helping in addressing issues related to environment and trying to reduce them. The
negative impact is that the company have to pay high cost for the substitutes of plastic.
 Legal factors- These are the rules and regulation prevailing in the industry in which the
company is going to enter or are already working. The company have to all the different
rules and regulations of the countries in which they are operating. The positive impact is
that the company can enhance their reputation by following rules. The negative impact is
that the company have presence in more that five countries and in order to follow all the
rules that company have to hire a team of professionals who can keep a close check but
will charge high prices.
M3 Use PESTEL model to analyse the macro environment in the company
The PESTEL model is developed for the analysis of the external environment which directly
influences the performance of the company if a close check is not kept by the managers and
10

leaders (Mawejje, J. and Sebudde, R.K., 2019.). The PESTEL model determines the factors
which are directly linked with the working of the company and that include the political,
economic, social, technological, environmental and legal factors. For the development of the
objectives of the company these factors are important to be taken into consideration.
TASK 4
P5 Perform external and internal analysis of specific companies in order to identify their
strengths and weaknesses
SWOT analysis of Tesco-
Strengths Weakness
 The company has a unique profit model. It
will enable the company to collect VAT
and sales taxes directly from the customers
and pay them to the government because of
which the international business of the
organization account for only 1% of their
net revenue from sales. The company also
continuously reduces its cost with the help
of efficient improvements (Moktadir and
et. al., 2020.).
 No doubt that the company is expanding
and the company is having more income
due to expansion but the company till have
a lot of dependency on the domestic
market of UK. This can affect the business
of the company if the economy of UK
slows down.
Opportunities Threats
 Due to the investment and continuous
improvement of the online platforms of the
company, the company is now able to
provide services through online channels as
well. This will provide a competitors
advantage to the company and an
opportunity to capture a larger market
segment.
 The current issues related to the Brexit
Policy serves as a major threat for te
company as in order to provide affordable
goods to the consumers the company
import their goods. The Brexit policy can
disturb the supply chain of the company
(Nayak and et. al., 2019.).
11

SWOT analysis of National Health Service (NHS) -
Strengths Weakness
 The company has loyal and committed
workforce that are willing to deliver best
services possible and have high level of
morale (Niemimaa and et. al., 2019.).
 The company has a well developed
governance mechanism and also has a good
history of research and development
activities that has helped patients in
recovering faster.
 High level of bed occupancy rates and the
increment in the emergency activities are
one of the major weakness of the
organization.
 The organization are one of the largest
employers in the world which is why they
have a high agency staffing cost which is
not good for the finances of the
organization (Pînzaru and et. al., 2018,
September.).
Opportunities Threats
 The organization can work with private
sector which will help in generating some
income for the activities of the trust. Also it
will help in developing healthcare
campaigns on the main site of the
organization.
 The organization can ensure their
interference with community, primary and
social care is provided to the patients in the
most appropriate environment.
 Increase in the cost of rented properties of
National Health Services due to the new
ownership structure that the organization
is going to follow.
 Loss of market of the organization due to
alternative service providers (Rantala, T.
and et. al., 2018.).
P6 Evaluate how weaknesses and strengths relate with macro environmental factors
 Political factors- It refers to the determinants that tells the company about the
interference of the government in the free market or in the industry in which the company
is working. It includes tax policies, political stability, etc (Rocha and et. al., 2019.). The
disturbance in supply chain due to the Brexit policy is a weakness but the company is
manufacturing their goods which is a strength for the company.
12

 Economic factors- These are the determinants that are indicators of the economic
performance of a country’s economy. It includes exchange rates, import duties, etc. In
context to Tesco, the company is highly dependent on the economy of United Kingdom
which is a weakness but the economy of UK is doing good in recent times which is why
the company is in profits.
 Social factors- These are the factors that are related to the community in which the
company is operating. It includes demographics, age, gender, geographical locations,
career and attitude (Silvius, G., 2018.). These are related to the culture and the norms of
the society in which the company is operating. Changes in the consumer preferences and
tastes can be a major disadvantage for the company. The company has majority of the
market share which is around 28% and is a strength for the company.
 Technological factors- These are the factors that tells the company bout the prevailing
technologies in the industry and the technology that the competitors possess. It is
important for the company to invest in upgraded technology in order to be ahead of
competitors and in order to make sure that they are having competitors advantage in the
market. Use of self checkout machines which is an innovative idea is a strength for the
company but employees may resist to change which is a weakness.
 Environmental factors- These are the factors that are related to the sustainability and
eco-friendly workings of the company. It includes carbon footprints, plastic wastage, etc.
The increasing concern of general people about the environment is a weakness for the
company as plastic alternatives are high in cost and it is also changing the taste and
preferences of the consumers which is why the consumers are having more healthy food
then supermarkets ready to eat foods (Tuan and et. al., 2019.). The strength of the
company is that it gives the company an opportunity to enhance their reputation and
increase brand awareness.
 Legal factors- These are the factors that are related to the rules and regulations of the
country in which the company is operating. These are the legislation and rules that the
company must have to follow in order to avoid any legal issues. Their are several legal
issues that the company have to face because each and every country have their own set
of rules and regulations which the company have to follow (World Bank Group, 2019.).
13

The strength is that these rules and regulations helps the company in working ethically
and will prevent the company from any unfair trade practices.
M4 Use SWOT analysis and explain how they influence in decision making
SWOT analysis determines the strengths and weakness which has to be identified within the
business operations and the opportunities and threats is helpful in determining the outside factors
which are present in the business environment (Xuhua and et. al., 2019.). The objectives and the
decisions of the organisations are made on the basis of such analysis after conducting proper
research. It also depends on the manager as how they convert the threats into opportunities which
will be used in the decision making.
D2 Impact of macro and micro factors on the business objectives and decision making
The macro factors are those which are outside the business and the micro factors are those which
are within the business and which consists of employees, resources, finances and others (Zaman,
K., 2018.). The impact which these both factors makes is immense and for that it requires the
close check on such factors.
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CONCLUSION
From the above report it is concluded that their are three types of business having different
ownership, having their own set of rules and regulations, with different purpose and with
different structures. It is important for the companies to analyse their mission and vision in order
to have a specific set of goals and objectives which can help them as well as their workforce in
working on the path towards those set of goals and objectives. The companies must have a
structure within the organization which can help them in distributing the roles and
responsibilities efficiently and effectively. It is also concluded that it is very important for the
companies to analyse their internal as well as external factors from time to time in order to make
sure that they are aware of the environment and will be able to have competitors advantage in the
market.
15

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