Business and Business Environment: A Comprehensive Report

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BUSINESS AND BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
Introduction......................................................................................................................................1
Part 1................................................................................................................................................2
1) Different types of organisations..............................................................................................2
2) Size and scope of the organisations.........................................................................................4
3) Organisation structures and functions.....................................................................................6
Part 2................................................................................................................................................9
a) Apply the PESTEL model to the sector to analyse how the macro environment is impacting
the UK retail sector......................................................................................................................9
b) Apply the SWOT/TOWS analysis and also Porter’s five forces analysis to any UK
Supermarket to determine how they influence decision of the supermarket.............................11
SWOT analysis..........................................................................................................................11
Porter’s five forces analysis.......................................................................................................13
Conclusion.....................................................................................................................................15
References......................................................................................................................................16

LIST OF FIGURES
Figure 1: Organizational functional structure..................................................................................6
Figure 2: Difference between global, transnational and international organization........................7
Figure 3: PESTLE analysis..............................................................................................................9
Figure 4: Porters five force model.................................................................................................13

LIST OF TABLES
Table 1: Different Kinds of the organizations based on scope and purpose...................................2
Table 2: Different Kinds of the organizations based on size...........................................................4

Introduction
The business environment is being consisted off the nearby factors which help either of hinder or
foster the business development. The sum of all such forces and factors are called a business
environment. Five elements are there in a business environment such as the political, legal,
social, environmental, economic and technological environment. The macro environment is an
institution and force outside of an organization which can affect the organizational performances
potentially that also comes under the external business environment which consists of various
political, cultural, natural and economic demographic forces. Different kinds of the organization,
along with its purpose, will be discussed in the report. The small, medium and large size
organization along with its scope and size will also be further discussed in a report.
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Part 1
1) Different types of organisations
Different kinds of the organization are there in the business environment that is differentiated
based on scope, size and purpose. Some of the following differences are given below that is
between some of the organization like non-government, nonprofit and profit organization are as
follows:
Table 1: Different Kinds of the organizations based on scope and purpose
Basis of
difference
Profit organizations Not for profit organizations Non- governmental
organizations (NGOs)
Purpose These are such organization
whose major aim is to earn
maximum profits by selling and
buying different services or
goods. The private organization
mostly is a profitable organization
that focuses mainly to gain the
maximum of the profits by selling
a variety of services or goods
(Schlagwein and Hu, 2017).
These are such organization
whose major purpose is to
enhance social welfare instead
of earning the maximum of the
profit. For such an organization,
firstly society comes and
always focuses on a person
such activities as well as
programmers which maximize
social welfare.
These organizations are such
organization whose significant
purposes is to create awareness
in protecting the rights as well
as create people interest in a
community. Such an
organization performs the
different activities like the
protection the environment,
health and human rights
voluntarily.
Scope Such organization perform the
task or those activities by which
they can gain maximum profits;
such organization also sell and
produces those services and
products which is in higher
demand that helps the
organization to earn the profits
instead of making the social
welfare.
Such an organization is public
and private organizations that
perform the various activities as
well as also organize the
programmer systematically
which provide the organization
maximum profits.
In such an organization, the
people join hands voluntarily
which contribute their efforts
and times that ensure enough
social welfare (Alonso et al.,
2016).
They are voluntary groups or
sector that are being
established at an international,
national and local level as well
as also perform the various
activities which ensure the
effective development and also
resolve the several people
problems in a community.
Such an organization is
connected closely with the
government organization and
private sector in terms of
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achieving the objectives and
aims.
Size These include large, medium and
small organization which are
operated and owned by private
entities group or private
individuals.
They are social and charity
enterprises that are of large and
small scale organization which
is depend on its functionality
and operational areas. Mostly,
they are large and big scale
organization which is operated
in international, local and
national level.
The NGOs is independently
operated from government or
state rules and regulations and
they are also large, medium
and small in size that is depend
on its operations and functions.
Source of
revenue
Such organization has their own
revenue sources from selling the
services and goods as well as also
obtains the capitals form the
organization, partners or the
owners (Williams and Hernando,
2018).
Such organization have
revenues source from the
government grants, membership
fees, subscriptions, and
donations.
They are as same as non
profitable organization in
terms of generating the income
from donations, charity funds
etc. The multilateral and
bilateral aids are also major
funding sources for this sector.
Examples Morrison, ASDA and Tesco are
the main examples of this sector
which focuses mainly to generate
the maximum profits.
American Foundation for
Suicide Prevention, Fine arts
museum in Boston is non
profitable organization
examples.
BRAC, Cure Violence,
International rescue
committees are main example
of NGOs.
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2) Size and scope of the organisations
The organization is also classified and differentiated based on the size like large, medium, small
and micro-sized organization. Such organization have a different share of market, sustainability,
growth and profit share whose objectives is differentiated from each other that is mentioned
below:
Table 2: Different Kinds of the organizations based on size
Basis of
difference
Small sized organization Medium sized organization Large organizations
Market size Such organization has the small
share in market and thus is
operated and run on the small
scale. They have small in market
size as their main motive is to
improve the local qualified
people economic conditions in
the community (Klimek, 2017).
These sector market size is
smaller comparatively with large
sector organization, Such
organization has lesser
employees in numerous and the
annual turnovers is also not €50
more.
Such organization is operated
at large sales in international as
well as national level and thus
have the larger market shares.
Theses sector invest the capital
at large level and also utilize
the maximum resources in
terms of achieving the business
objectives on time. These
sectors have more that 250
employees and run its business
beyond the medium sector
organization limits.
Profit share They focus mainly to gain small
profits shares in terms of retain
longer in a market because these
are operated and run at local
level.
Such sector profit shares are
relay upon business market share
and consumer based. These
sector profit share is completely
different in the different areas
and is also difficulty in assessing
the shares of profits (Dessein et
al., 2016).
These sector run or operated at
large scale so for this they has
higher share of profits in
international as well as
national market because if
compares to medium and small
sector the profit growth rate of
this organization is around
48% in an economy.
Market growth The small organization market
growth is limited because they
This sector market growth is
lower than as compare to large
This sector market growth is
higher as compares to small
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are operated on small scale as
well as it also utilize the
optimum resources and also
invest small capital amount in
the business. The appropriate
strategy of the business is one of
major factors which is used to
enhance the small organization
market growth.
sector, Such organization
enhances its productivity and
market growth through
developing the effective market
and business strategies.
and medium sector as they run
their business at large scale at
global and national level.
Future scope or
sustainability
This organization is focusing to
gain small profits amount
through generating the job
opportunities mainly for local
individuals in a community and
thus it is focusing lesser on
business sustainability
development and growth (Bosco
et al., 2015).
For such organization it is
difficult to ensure the
sustainability business growth
and development because they
have numerous competitors and
gaveling the competitive services
or products in a market.
They operated their business
globally in which throat
competition are there and this
organization also ensure the
business sustainable growth
only through developing the
appropriate market and
business strategies by business
the strategies of competitive
pricing (Wickert et al., 2016).
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3) Organisation structures and functions
Different kinds of an organisational structure are there, which is followed through different types
of the organization like large, medium and small size organization (Hingley et al., 2015). Some
of the following organizational structure is mentioned below, which is used commonly are as
follows:
Functional: Based on functional structure, an organization is being divided into a different unit
of functional like consumer service department, human resource, distribution and sales
department etc. It is that kind of organization structure which is suitable mainly for medium and
small size business like Leon restaurant, Five Guys restaurant under which various functions is
being divided into a various individual which perform its functions with their fill efforts in terms
of accomplishing the goals of the business.
Figure 1: Organizational functional structure
(Source: www.tutor2u.net, 2019)
Matrix: According to this structure, in an organization, the employees have numerous reporting
lines and supervisors, so they are not only accountable to a single authority, but various
authorities also (Roberts, 2018).
Divisional: According to this structure, an organization is being split into various units which are
called as divisions along with its structure is mainly suitable for such organization which has
numerous brands, assets and products. The main example is Gas Inc. that applied its
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organizational structure in which Gap Inc and numerous retailers are regulating under these
units.
Complexities of international, global and transnational organization structures
International organizations: Such an organization has no outside investment of that if home
country because they are exporter and importer organization only. No complexity scope is there
because all transactions of business take place here based on main organization guidelines.
Global organizations: Such organization have its business in numerous countries worldwide so
much wider scope is there than compared with the international and transitional organization. For
example, Apple is a global organization example whose business is run in numerous countries,
but these all business units have to follow main organization guidelines and structure to run their
business properly.
Transnational organization: It is the complex organization which have invested mainly in
foreign operations and having the operations all across international borders. Such an
organization also has central authority power, but such gives the conducting power to marketing,
R&D and decision making to an individual foreign market (Seidl, 2016). The complexity of such
an organizational structure sometimes creates disputes in an organization at an international and
domestic level. For example, McDonald’s is transactional organization examples, so for the
organization, this is important to deal with the patient when dealing in an organization.
Figure 2: Difference between global, transnational and international organization
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(Source: www.corporate-cases.com, 2019)
Organization functions relations with overall organization objectives and mission
To run and operate the business, each business sets its own mission, vision and objectives and
different units of functional areas are there which ensure the business organization success. In an
organization, different units of functional are there such as customer support, finance, human
resource, marketing and administration and for this properly coordination and communication
must be there which ensure that organizational objectives and mission is accomplished on time.
Also, an organization faces many complexities for achieving the set vision and mission, and it
occurs only if the organization is unable to coordinate properly with functional units.
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