Business and Business Environment Report: Sainsbury's Analysis (BTEC)

This report provides a comprehensive analysis of the business environment, utilizing Sainsbury's as a primary case study. It begins with an introduction to the fundamental concepts of the business environment, including the different types of organizations (public, private, and voluntary sectors) and their legal structures. The report then delves into an in-depth examination of Sainsbury's, covering its size, scope, mission, and organizational structure. Task 2 explores the relationship between different organizational functions and their alignment with organizational objectives. Task 3 focuses on the identification of positive and negative impacts of the macro environment on business operations, supported by specific examples, and includes internal and external analyses of Sainsbury's to identify its strengths and weaknesses. The report concludes by explaining how these strengths and weaknesses interrelate with external macro factors. The report highlights key elements such as PESTLE and SWOT analysis, and the interrelation between various departments like marketing, finance, and human resources. This report offers a clear understanding of how businesses operate within the broader environment and provides insights into the challenges and opportunities faced by organizations like Sainsbury's.

Business And The Business
Environment
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TABLE OF CONTENT
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
P1 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..............................5
TASK 2............................................................................................................................................8
P3 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure........................................................................................8
TASK 3..........................................................................................................................................11
P4 Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples...............................................................................11
P5 Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses...........................................................................................................13
TASK 4..........................................................................................................................................15
P6 Explain how strengths and weaknesses interrelate with external macro factors..................15
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................17
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INTRODUCTION
Business and business environment is one of the most crucial elements which effectively
help in understanding the knowledge of formative set of operating regulations and other form of
business operations (Hilton and Platt, 2013). It mainly include internal and external
environmental forces that drives business functioning in positive and negative manner. All these
elements are required to be effectively considered by an organisation in order to facilitate their
operations in best effective manner. Present report has been based on Sainsbury, a Supermarket
store situated in London UK. Company is one of the third largest chain of superstore and
contribute up to 16.9% market share. Organisation serves qualitative products and services to
their customers. Further in the report format of discussion has been made on size and scope of
public private and voluntary organisation. In addition with this pestle and SWOT analysis has
been covered in this report which is required to be effectively considered by an organisation. As
with the help of this company can able to evaluate strength and weaknesses in external
environment with the help of which they can operate their business operations in a smooth
manner and can overcome challenges to gain more developmental opportunities. Lastly, in this
report relationship in between wide range of organisational functions along with their link with
organisational structure are covered in this report.
TASK 1
P1 Different types and purposes of organisations; public, private and voluntary sectors and legal
structures
Business environment includes different types of organisations those who effectively
perform their business operations in order to gain profit and serve customers with their
qualitative services and products (Hillary, 2017). There is N number of business organisation
those who play their roles and responsibilities in order to order to gain more developmental
opportunity while operating their functions. These organisations perform their functions as to
grow their profit ratios in more and more amount while serving their customers. If it is
considered in international level, wide range of business organisations are operating their roles
that are classified into private, voluntary and public. All these organisational segments have
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different kind of structure scope and legal structures with the help of which these organisations
effectively operate their business functions in correct way as to gain long term sustainability and
further fulfil goals and objectives in best effective way. Mentioned below define classifications
of all these organisations are given:
Private sector organisations within this sector are owned and managed by private people
individual, firms and any other legal authority. Main motives of companies those who are
operating their functions in this sector in towards gaining high amount of profitability (Hair and
et.al., 2015). Along with this private sector are also considered as a sole trader as they operate
their business functioning by own. Apart from this private firms and sole traders have big
differentiation in between them, one of the major difference in their structure as sole traders
have small operating functions but private firms comparatively have define size, shape and
structure as per accordingly to their business hierarchical level as main motive of private
organisation is to gain high amount of profitability. Organisations within private sector mainly
gather their funds from the sources like Financial Institutions, business entities, investors, bank
loans and more.
For example Sainsbury is considered in private sector organisation as they have their own
working structures along with customer regulation.
Public sector organisation this sector are those who perform their functions by having full
control by government bodies, public bodies and other government agencies. Main motive of
companies within this sector is to effectively serve society by providing welfare to people rather
than to generate large amount of profit. Public sector business organisations have democratic role
in which each and every individual is entitled to make their own decision. In addition with this
individual in public sector mainly have influences and control for their regulations as to gain
high end profits (Shenkar, Luo and Chi, 2014). In addition with this organisation within this
segment have authorisation by government entities. Along with this public sector organisations
structure, size and shape are different from legal bodies.
For example BBC is considered in public sector organisation as they are controlled by
government bodies while having sharing to make profits.
Voluntary organisation entities within this sector mainly operate their functions with
the motive to serve populations and fulfil their needs and Desire by providing social welfare
facilities. Financial support for voluntary organisations is gathered from private organisations as
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these organisations provide large amount of fund as charity for their goodwill. Voluntary
organisations mainly have long surviving business as they get back support from individuals for
their welfare activities. These organisations effectively conduct services and operations with
volunteers from different locations those who willingly come towards to help society and
individuals.
For example Oxfam is considered in voluntary sector organisation as they effectively
provide welfare services to populations in drought prone zone and other affected locations. These
voluntary organisations effectively serve individuals in order to increase their standard of living
and so society with best.
P2 Explain the size and scope of a range of different types of organisations
There are different types of business organisations those who perform their services as to
serve their goals and objective (Groebner and et.al., 2013). These entire organisations have
different set of structure, size and scope. Public, private and voluntary organisations offer their
services by having their own set of structure and size with the help of which they effectively
continue their business operations. Mentioned below structure size and other following elements
are described in context with these three organisational structures:
Sainsbury
Sainsbury is one of the third largest retailing organisations operate their services in
supermarket industry. Company provide groceries and other business products and services to
customers as to effectively serve them in best effective manner. In addition with this Sainsbury
offer financial support, telecommunication and more to consumers. Sainsbury have their own
environment and diverse culture with the help of which they serve their customers by providing
best effective and qualitative products and services.
Vision and Mission Sainsbury effectively conduct their services with a mission to offer
their services while expanding their area of services around the globe where their operations are
still untouched (Charter, 2017). In addition with this Sainsbury mission is to be as “Customer's
first priority”. With the help of formative set of Vision and mission Sainsbury effectively serve
their customers in best effective manner that helps them to further gain their loyalty.
Size and scope As Sainsbury is a multinational chain of Supermarket Store they offer their
services in wide level in the area of Scotland, England, and Ireland. Organisation is having more
than 4000 individual employed within their organisational structure with the help of which
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company operator services in best effective manner. Sainsbury is looking forward to expand their
business operations in the region of Europe as to serve European customers with a qualitative
products and services.
Organisation structure:
Illustration 1: Structure of the Sainsbury
Sources: Structure of the Sainsbury, 2018
BBC
BBC a leading broadcasting firm who also operator service as a Financial Institutions
provide services like investment generation, TV views to customers in best effective manner
(Harrison, 2013). Company also offer services related to management Consultancy Services.
BBC is mainly known for their High Quality Services.
Vision and Mission company operate their functions with a vision to make “People
thought to be broadcast” along with this mission that has been hold by company is to enhance
their profitability ratio by 20% in the next upcoming financial years.
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Size and scope BBC is one of the leading broadcasting firm and a largest organisation who
provide their services in domestic and other Nation while having more than 1200 employees.
Company comprises with the structure of flat organisational structure within which they have
different set of functions of business.
Organisational structure:
Illustration 2: Organisation structure of the BBC
Oxfam
Oxfam is a charitable Organisation in which 20 other entities conduct their services to
provide welfare to society. Organisation effectively provides their services in famine, drought
prone and other affected areas with the motive to increase living standard of individual.
Vision and Mission Oxfam a charitable organisation perform their business with a vision
to serve society with their services and offering humanitarian services (Chang, 2016). In addition
with this Oxfam vision is to increase living standards of individual.
Size and scope this entity is not having a particular structure as in this they operator
services with the help of volunteers those we belong from different locations and can take
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participation as per according to their wish. Scope of Oxfam is to serve more affected areas
while increasing living standard of individual as to make them earn for their livelihood.
Organisational structure:
Figure 1Oxfam's organisational structure
Sources: Organisation structure of Oxfam, 2019
TASK 2
P3 Explain the relationship between different organisational functions and how they link to
organisational objectives and structure.
There are different departments in an organisation such as marketing, finance, human
resource, production, sales department. It is very important for an organisation to effectively and
efficiently working of all these department to achieving goal and objective of organisation. All
these department play a major part and contributes in overall profitability of organisation. It is
very important that each department coordinate with other department for better performance of
department as well as company (Ambler, Witzel and Xi, 2016). Sainsbury's is an organisation
which is dealing in retail sector and it is essential for this organisation that all department work
together to gain larger market share. Departments of Sainsbury's is interrelated with each and
other so that they can work effectively and efficiently in order to achieve objective of
organisation. Interlink between different department of Sainsbury's is mention below.
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Production with marketing department
Marketing department is a department with deals with advertisement and promotion of
products and services offered by this organisation. Production department is responsible for
developing and manufacturing products for organisation. These two departments are interlinked
with each other as production department will manufacturing products and marketing department
is responsible for selling those products. Marketing team will also analyse and identified needs
and demand of products in market area and conduct a proper market research to understand
customers requirements (Erasmus, Strydom and Rudansky-Kloppers, 2016). It is responsibility
of marketing department to convey needs and requirements of customers to production
department so that this department can manufacture products as per requirements of customers.
Finance with human resource department
Human resource department of Sainsbury's is interrelated with finance department as
activities of these department are interlinked with each other. Finance department is responsible
for taking account of all financial resources of organisation and this department provides budgets
to each department for completion of departmental activities. Human resource department
function is to find and hire right department of employees for organisation and solve all issues of
employees in company. Finance department will provide requirements about hiring of new
employees and it is responsibility of human resource department is recruit and hire well qualified
and highly skilled employees for finance team. Finance department will provide budget or
finance to human resource department to find right candidate for organisation. Finance is very
important for carrying out departmental functions effectively and efficiently.
Marketing with finance department
Marketing department and finance department of Sainsbury's company are interrelated to
each other and it is very important for organisation that these department coordinate with each
other. Marketing department is majorly responsible for increase sales of organisation and finance
department will measure cost accrued by organisation function as well as overall profits earned
by this organisation (Bocken and et.al., 2013). Marketing department carry out various activities
for promotion and marketing of Sainsbury's business and its products or services. For carrying
out these activities marketing team requires large amount of finance or money. Finance team will
evaluate and analyse the increase in profits as well as cost accrued form marketing activities.
Human resource with sales department
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Sales department of Sainsbury's organisation will help in increasing sales of company.
Human resource team is responsible for hiring right employees or this department as well as
training them to perform better. Human resource department functions will help sales department
by effective training and development of department. Human resource team will provide training
which help sales department employees to increase their skills and ability to perform a task
(Boons and Lüdeke-Freund, 2013). Training and development will leads to increase in overall
productivity of sales department team as well as better performance. Sales department needs to
communicates with customers so it is very essential for this department to improve their
communication skills to influences more customers.
Interrelation of organisational department have impact on organisation structures. There
are various advantages and disadvantages for interlink of different department of company.
 Advantages: Interrelation of different organisation functions and department leads to
effective and efficient working organisation. This will help employees work closely with
employees of other department and it will leads to integration of skills and ability of
employees. Employees can work better by coordinating with other employees. By this
employees and departments can help each other. It will offers a great scope of expansion
to organisation and its functions. This is beneficial for organisation in solving issues and
problems of other departments in company. Interrelation of different department will help
in improving productively of organisation and achieving goals and objective of company.
 Disadvantages: Interrelation of various departments of company can leads to delay in
decision making. When task and function of Sainsbury's organisation is related to each
other then it leads to delay in making business decision as decision can be taken after
evaluating each and every factor of all department (Bah and Fang, 2015). This can create
chaos in organisation and affect the overall productivity of company.
TASK 3
P4 Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples.
In order to analyse the impact of macro environment on business it is very essential to
carefully analyse each and every factor of external environment. Macro environment consist of
various factors and these factors have positive as well as negative impact on business and its
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operations. Sainsbury's organisation is providing its products and services to large area and have
to face various impact of external factors. External environment includes various factors such as
political, social, economical, technological, environmental, legal. Sainsbury's company have to
consider all these factor while taking business decisions as it effect the overall function of
organisation. For evaluating these factor, organisation have to conduct PESTEL analyse.
Political factor: This factor includes all rules and regulation of government and political
party. Political factors refers to the degree of government interference and intervenes on business
and its operations (Apăvăloaie, 2014). This factor includes various policies, rules and regulation
of government, trade policies, pricing policy etc. All these factors have positive as well as
negative impact on Sainsbury's business as government and political party play a very crucial
role in business operation. Positive - Sainsbury's organisation is dealing in UK market are so stability of UK
political and government party is a positive factor. Government of UK is taking various
decisions for welfare of UK retail sector companies and stability of government and its
rules is opportunities for this organisation to grow.
 Negative – Strict rules and regulation of government on trade of Sainsbury's goods and
services is a negative factor. Government have UK has stated strict trade restrictions
policies which leads to limited import and export of products.
Economical factor: It includes factors such as economic growth, interest rates, inflation,
exchange rates, economic condition of country etc. All these factors influence customers
purchasing power as well as organisation activities. Impact of economical factor on Sainsbury's
business in mention below. Positive - Economic condition of UK is continuously increase and UK have one of the
leading economy in the world (Belás and et.al., 2014). So economic growth rate of UK as
well as its economic condition can be consider as a positive factor for Sainsbury's
organisation. This factor will increase the purchase
power of customers.
 Negative - UK government has set high interest rates of products and services of
Sainsbury's. High interest rate effect the sales of products and services of company as
well as have negative impact on profitability of organisation.
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Social factor: External factor consist of social culture factor and this factor affect the
demand and supply of organisation products in market. Social factor includes various factors
such as eduction level, culture or believes of customers, attitude, leisure interests, populations
class structure etc. Positive – Customer's lifestyle and culture of UK society match with the products and
services offered by Sainsbury's. Customers of UK buy products and services from
superstores and hypermarket. So belief and positive attitude of customers towards
Sainsbury's stores is an opportunities for organisation.
 Negative – Customer's needs and wants are continuously changes and this can be
consider as a negative factor for Sainsbury's business (Popescu, 2013). There are
different types of customers with various requirements and there needs or demands
changes with time. So it is very difficult for organisation to satisfy needs and wants of all
customers.
Technological factor: Technology factor includes all those factors which is related to
technological innovation and development. This factors affect overall performance of
Sainsbury's company and its operations. Technological factor includes factors such as new and
updated technology, innovative technology etc. All these factors have positive and negative
impact on organisation. Positive – UK country have most advance technology so technological external factor
have positive impact on Sainsbury's business. Company can use new and updated
technology in it working process and increase productivity of organisation. Technological
factor will have positive impact on product offering.
 Negative – Company requires huge amount to use updated technology in its working
process. High cost of advance technology can have negative effect on organisation as
company have to train its employees about usage of modified technology.
Environmental factor: This factor includes weather condition, climate change, laws
related to pollution, recycling, waste management and other environmental laws (Enofe and
et.al., 2013). These factors of environment can have positive and negative impact on business.
This factor can help in effective and efficient working of organisation. It is responsibility of
company to follow all rules and regulation for protection of environment.
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