Analysis of Business and the Business Environment Report

This report provides a comprehensive analysis of the business environment, examining the distinctions between public, private, and voluntary organizations, and their structures. It delves into the interrelationships between various organizational functions, such as marketing, production, and finance, and their impact on organizational objectives. The report identifies both positive and negative impacts of the macro environment on business operations, utilizing PESTEL analysis. A SWOT analysis is conducted for Hilton, and the interrelation between strengths and weaknesses with external macro factors are explored. This report aims to provide a detailed understanding of how businesses operate within their environment and how they can adapt to various challenges and opportunities.

Business and the
Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
P1) Difference between public, private and voluntary organization......................................1
P2) Study size and scope of different types of organization. ................................................4
TASK 2............................................................................................................................................5
P3 Relationship Between Different Organisational Function and their Link to Organisational
Objectives and Structure.........................................................................................................5
TASK 3............................................................................................................................................6
P4) Identify positive and negative impacts of macro environment on business operations. .6
TASK 4............................................................................................................................................8
P5) SWOT analysis carried for the company Hilton..............................................................8
P6) Interrelation between strengths and weaknesses with external macro factors...............10
Conclusion: ...................................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business refers to the platform where goods or services are exchanged with each other for
monetary value. Here, seller sell the product and buyer purchase the goods in order to meet the
emerging needs of the customers. It is important to carry out business transaction as it helps the
economy of the country to raise in terms of revenue. Hilton is an American multinational
hospitality company. The founder of the organization is Conrad Hilton it came into existence in
the year 1919. Firm's headquarter is in McLean Virginia. This report covers various types of
organizations like, public, private and voluntary and are explained in detailed. However,
relationship among several organizational functions and how they are interconnected with
companies objectives and structure are studied (Aithal, 2016). Additionally, macro environment
positive and negative impacts on business operations are identified. Moreover, Swot analysis is
conducted and also focuses on how strengths and weaknesses are interrelated with macro factors.
TASK 1
P1) Difference between public, private and voluntary organization.
Business environment is a allocation of all internal and external factors like, employees,
customers expectations, suppliers, clients, supply and demand, managements, social trends,
government activities etc. which are not controlled by company but they affect the growth,
profitability, and even survival of the organization. External environment helps the business to
identify opportunities and threats in the competitive world so that they can be turned as
advantages for the firm in future. There are three types of organization which are public, private
and voluntary and there distinction are explained as follows:
Basis Public organization Private organization Voluntary
organization
Meaning Public organization is
owned and operated
by government. In this
50% shares are owned
by government bodies.
Public organization
can be stated as
enterprise which is
owned by public
authorities including
central state.
Voluntary organization
is a group of members
which is organized on
voluntary membership
without state control to
accomplish common
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interest of it's
members.
Purpose Public organization's
main purpose is to
provide public services
instead of profit
generation.
Private organization
purpose is to
maximize huge profits.
Voluntary organization
is to work for the
betterment of the
society.
Raises money It raises funds from
public revenue like
taxes, penalty etc.
It collect monetary
value by issuing shares
and debentures.
It gather money from
various sources like,
through donations,
grants, governments
contracts and income
from their own trading
activities.
Benefits of working If people work in
public organization
they will be benefited
by job security,
allowances,
perquisites,
retirements benefits
etc.
Private organization
provide incentives,
good salary package
etc. to the people.
In voluntary there is
no such benefits
provided to the
members.
Examples Public organization
examples are, F5
Networks, Google
LLC, Chevron
corporation etc.
Here, are the examples
of private organization
such as, Candy maker
Mars, Facebook, Ikea,
Agriculture gaint
Cargill etc.
Examples of voluntary
enterprise are as
follows: World Vision,
American Red Cross,
Oxfam etc.
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Legal structure of public company: The legal structure of public organization are explained as
follows:
Sole trader: This is one person business in which small amount of investments are
needed to start up a business. Here, all risk and finance are handled by individual person who is
the owner (Andersson and Holm, 2015). Some of the examples are, newsagents, market traders,
hairdressing etc.
Partnership: In this case partners of size of Chevron corporationa business can be from
2 to 20 in numbers. Normally sleeping partners are good for the business as they invest finance
in it but do not give any input how a business will run. Here agreement is done between the
parties as well as their share for profit and loss. Examples are, accountants, veterinarians,
solicitors and dentists.
Private Limited company: It is a joint stock company and has separate legal identity.
Each shareholder is a part of private company and each share entitles the owner to 1 vote at
company's Annual General Meetings.
Legal structure of private organization:
Central government: It is responsible for national environmental policy directed to
share hands in health and safety of people in maintaining and improving quality of the
environment and contributing to sustainable economic development.
Local government: This a public governing body of districts, towns, cities and countries.
It includes both country and municipal government structure. Here, country government is public
administration of a country (Bah and Fang,2015).
State government: This a government of a nation subdivision in a federal form of
government. It share political powers with national government.
Voluntary organization legal structure:
Trust: It is legal entity which handles all monetary value on behalf of another entity. In
this case funds are allocated through trust group so that voluntary organization can use them for
betterment of the society.
Charitable incorporated organization: This is a non profit organization and their main
motive is well being of society. It work for the development of the society on continuous basis.
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Thus, Hilton is using legal structure in their organization which is helping them to
maintain smooth functioning of the business . It also aid in achieving desirable objectives and
customers requirements on time. (.Bocken and Short, 2015)
P2) Study size and scope of different types of organization.
Basis Public organization Private organization Voluntary
organization
Product Chevron Oronite
company deals in
quality additives that
is used to enrich
performance of fuels
and lubricant.
Mars Petcare firm
deals in dogs and cat
foods like, pedigree,
Royal Canin, IAMS
etc.
American Red Cross
provides shelter,
mental health, food
etc. to the entire
society so that they
can stand back on their
feet again.
size In this company
around ~51,900
employees are
working at San Ramon
, California.
In this organisation
around 80,000 people
are working across the
globe. It is located in
6885Elm Street
McLean, United
States.
American Red cross is
located in Washington,
United states. It
revenue is around
US$2,714,189,000
according to 2017
data.
Scope Chevron Orinite main
scope is to provide
improve quality of
fuels.
Mars petcare scope is
to provide healthy
foods for animals.
American Red Cross
scope is to provide
better services to the
society in all
circumstances.
Objectives Organization's
objectives is to reduce
friction and wear by
dissolving deposits,
control oxidation and
In this case, it's
objective is to provide
high quality product to
it's customers and
generate maximum
The objective of
American Red Cross is
to provide free
services to the suffered
people so that they can
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inhibit corrosion. profits. stand back on their
feet again .
TASK 2
P3 Relationship Between Different Organisational Function and their Link to Organisational
Objectives and Structure.
There are different department in an organisation which help in efficient working of a
company (Brown,2018). All these department are interlinked with each other in one or other
form. The functions of different department depend on one another and are discussed below :
 Marketing and Production department: Both these department of Hilton are
interlinked as the main purpose of marketing department is fulfilling the basic needs and
wants of the customers. The main purpose of production department is in creating of new
products and managing the quality and quantity which is based on demand of product in
the market. The close relationship between these two department is very important as it
will affect the overall performance of an organisation.
 Marketing and Finance department: Both these department of Hilton are
interconnected with each others and plays a important role in success of an organisation.
As for doing any promotional activities like advertisement on TV, radio and newspaper
company need proper funds which is provided by the finance department. With proper
coordination of finance department, marketing department is able to promote the
company which ultimately led to the success of an organisation.
 Production and Finance department: Production department is involved in making of
the product for the development of an organisation for which it requires adequate number
of raw materials, equipments and many more. It need proper funds for the same and this
need is fulfilled with the help of finance department. So it is the work of finance
department to decide how much fund need to be require for the production department in
order to know about the efficiency of the business (Fan and Zhao, 2015.).
 Sales and finance department: Both these department in Hilton are interlinked with
each other. Sales department main focus is over expanding the base of customers in an
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organisation and the aim of finance department is on profit maximisation. The function of
sales department is in generation of sales of the company and thus helps in providing the
funds to the finance department. It it the work of finance department to provide fund to
various department for the efficiently working of an organisation.
 Production and sales department: Both these department of Hilton are interlinked in
order to provide the customers with the best products. The work of sales department is
concerned with selling of the products which are produced by the production department.
Proper coordination is very essential between these department as if production
department is not able to produced the desired quantity it will have a impact on the sales
department of the company. Thus overall will affect the profitability of the concern.
It can be said from the above discussion that an organisation consist of various
department and all are interconnected with each other which plays a great role for the success of
an enterprise. With their proper working, organisational objectives can be easily achieved.
Proper coordination and communication should be there between every department of Hilton so
to run the business properly (Charter, 2017).
TASK 3
P4) Identify positive and negative impacts of macro environment on business operations.
Macro environment can be explained as external factors which are uncontrollable by
company but are influencing the firm's decision making process . It bis important to study
external forces so that business associates can accordingly make plans and strategies to compete
with these forces. Here, are some of the examples of macro factors which are, political,
demographical, socio-cultural , economical, technological forces etc. by studying all these
company get an rough idea regarding the market scenario and accordingly make tactics to deal
with them in the competitive world. PESTEL analysis is explained as follows:
Political factor: Political factor includes political stability, bureaucracy, foreign trade
policy, tax policy, consumer protection protection laws etc. all this factors are influencing the
decision making process on an organization. Political factor can influence Hilton visitors,
business travellers etc. both in direct and indirect ways. Whereas, Ireland may demotivate
visitors to the safety concerns and many government rules and regulations. Due to which
productivity level of the company decreases as well as profitability ratio. This plays a vital role
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in the growth and success of the business across the globe. Business operations are greatly
affected by political factors. All the strategies and tactics needs to be changed according to the
political forces. Examples: Northern Ireland visitors are reducing day by day because of ongoing
delicate political situation and also because of safety concerns. All this have reduced the
number of visitors due to which Hilton group is facing may problems.
Economic factors: Economic factor includes interest rates, disposable income, inflation,
economic growth, exchange rate etc. All this factors are affecting the business operations of
Hilton at a huge scale (Hamilto and Webster,2018). Continuous fluctuation in prices are
affecting the decision making process of the firm in negative way. Examples: During the time
of Olympic In UK in the year 2012 many hotels were booked completely for whole time period.
Due to which company earned huge profits but once the game was over the scenario was
completely different. Economic factor plays a significant role in enriching the profitability ratio
of Hilton. In the year 2007 when economic and financial crises raised the sales went down by
20% and profit by 40%.
Social factor: Social culture includes norms, beliefs, values etc. The business operations
of Hilton are greatly affected by social forces. Society's culture and way of doing things is
impacting the culture of an business at a tremendous scale. Hiltion's business operations are
influenced by societies, attitude, culture, leisure interest, entrepreneurial spirit, education level
etc. As buyers got educated so there preference is changing at a fast pace and it is not always
possible for the company to fulfil the desire every time so thus it has a negative impact on the
organisation.
Example: Population growth, health consciousness, career attitudes etc. are the factors
affecting the customers interest levels as well as companies profitability ratio also. Social factors
are directly related with the organizations growth and success in the competitive world.
Technological factor: Technological factor plays a vital role in an organization
upliftment. By using modern tools in their business Hilton can grab more and more customers I
the market. They indirectly assist the firm to achieve their desired goals on time. Examples:
Hilton should uses modern informational technology so that customers while booking does not
face any issue. As well as in order to resolve the quarries modern ways should be adopted to
build the healthy relations with the customers. Advancement in technology is helping the
business operations to meet the emerging needs of the customers (Hillary, 2017).
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Environmental factor: Environmental factor includes amount of sunlight, PH of water
soil , temperature etc. In environmental factor Hilton should study the culture of the people in
the United Kingdom market. However, by doing so consumers base can be lifted as well as
potential customers can be pulled towards there innovative product or services at a rapid scale .
Moreover, these factors directly affect the decision making process in the cut throat competitive
world. Here, the positive outcomes results to achieve framed objectives within no time.
Example: Hilton group is affected by the weather, recycling, waste management in service
sector, laws regulation environment pollution etc. due to which visitors are less in number.
Which leads to decrease in productivity and customer base forb the service.
Legal factor: Hilton is dealing in retail sector in the UK market. firm need to study
deeply all the legal norms and policies like, profit margins, viability and product transportation.
All this factor will help the business associates to carry out there business operations effectively
and efficiently in order to meet the set objectives. Decision-making process of Hilton is widely
affected by the legal factor as it's positives and negative aspects are directly related with
organization goals.
TASK 4
P5) SWOT analysis carried for the company Hilton
SWOT analysis is conducted by an business associates so that it's strengths, weaknesses,
opportunities and threat can be examined . By conducting this in the market organization comes
to known the opportunities prevailing in the market which later on can be turned out as their
business opportunities in the competitive world (Kolk, 2016). The SWOT analysis is discussed
as follows:
Strengths of Hilton Group:
Brand acknowledgement: Hilton group has high brand recognition in the cut throat
competitive world. Through it's services it has created good image in the eyes of the customers
due to which loyal customers are build in the market place. Firm through better services are able
to create good image in the market as well as positive perception is created in the eyes of the
customers.
Solid provider's relationship: Through there effective services Hilton group is able to
create solid relationship in the market place. They record the demands and preferences of the
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customers and when they visit the organization they offer the same demands so that they can be
made satisfied. It also helps them to bind them emotionally with Hilton group.
Interesting administration and items quality: Hilton group is coming up with
innovative idea each and every time in order to meet the dynamic needs of the customers in the
cut throat competitive world. By doing so more and more customers are getting attracted to the
services due to which customer base has been raised as well as profitability ratio respectively.
Weaknesses of Hilton group:
Not much develop network: The main weaknesses of Hilton group is that there is no
enough network in Europe and North America to contend with various lavish five star working.
Due to which growth and development is slow in the market. Due to lack of networks in the
Europe and North America Hilton is not able to grab the market ratio as well as is not able to
serve it's services to the customers in this countries (Kozubíková and Kristalas, 2017).
Higher dependency of proprietors: Hilton group is highly dependent on other
proprietors as it does not claim the greater part of it's lodging network. Due to dependency on
other proprietors firm is not able to grow and flourish in the market. The productivity level also
decreases respectively due to dependency on other in the competitive world.
Opportunities for Hilton Group:
Australian Market can be one of the interesting markets to explore: Hilton is having
a great opportunities to explore it's business cross Australia. As Australia is having biggest
economy it's a great opportunities to expand its business there. Hilton can grab huge market
ratio as well as more and more customer base can be increased for the services offered by the
firm.
Relationship management: Hilton is building effective relations with the customers so
that they can be bind for longer time duration. When healthy relations are carried out in an
organization then productivity ratio increases as well as goodwill increases in the eyes of the
customers.
Threats for Hilton Group:
New entrants: New entry is a big threat to the Hilton as they firm are coming up
innovative idea by which sales ratio decreases at rapid scale in the market place. Organization
new to make changes in their strategies so that they can bit new business assocaites in the
competitive world (Nohria, 2017).
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