Analysis of Tesla's Business Environment and Operations

This report provides a detailed analysis of Tesla's business environment, encompassing various aspects of its operations and external influences. The report begins with an introduction to the business environment, followed by an examination of different types, sizes, and scopes of organizations, inclu...Read More

Business and The Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Explanation of different types, size and scope of organisations..................................................1
Explanation of size and scope of range of different type of organization...................................2
TASK 2............................................................................................................................................3
The interrelationship of the various functions within an organisation .......................................3
TASK 3............................................................................................................................................4
Macro environmental factors with positive and negative impacts...............................................4
TASK 4............................................................................................................................................9
Internal strength and weakness of specific businesses by defining interrelationship with
external macro factors..................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCE ................................................................................................................................11

INTRODUCTION
The business environment comprises with internal and external factors which can be
arises while operating the business and managing the all activities. The environment is the
combination of various condition that arises in business activities and affected the profitability.
For business organization it is essential to analyse the environment for the purpose of accepting
challenges and operating a business effectively (Dumitran and et.al., 2020). To increase the
understanding about changing business environment this report has been prepared. Tesla is
selected entity for this report that is private form of organization manufacturing different model
of cars and managing the higher performance. The present report is considering types of business
industry, size and legal structure, impact of external and internal factors on environment and
interrelationship of numerous functions, and strength, weakness of macro factors.
TASK 1
Explanation of different types, size and scope of organisations
In business environment number of companies are operating their business in different
form that can help to operate the business and bring the changes as per customer demand that
provides good image. The types of organization with size and scope are as defined:
Public organization (BBC):
The public organization are non profit making companies which are owned by
government and operating for providing the variety of products and services by following
government policies. For instance, BBC is public company that offers public services by using
British Broadcasting Corporation, in which it gives information and news that make aware the
people (Ratten, 2020).
Purpose: BBC's purpose is to provide the relevant, reliable and up to date information by
conducting research and development activities.
Legal structure: This considers local government, state government and state
government as legal structure. BBC is large size public organization which is following central
government legal structure that increases the performance by providing information.
Private organization (Tesla):
This means an organization which is operating business for making profits by following
the companies regulation and act that can help to operate a business effectively. Tesla depicts as

large size auto mobile manufacturing company which understand the customer demand
manufacturing electric cars for customers. This is profit making company that bring the change
time to time and increase the number of customers (Seetharaman, 2020).
Purpose: The main purpose of Tesla is to provide the better design and features of
company for attracting large number of customers.
Legal structure: The legal structure of private sector consider corporation,
unincorporated, and solo, partnership and corporate structure. A private corporation legal
structure is following by Tesla that can help to provide products and increase sales.
Voluntary (Oxfam):
This is kind of non governmental organization which is operating by few people for
offering services. For example, Oxfam, is voluntary organization that is providing services to
alleviate global poverty.
Purpose: To create the lasting solution for injustice of poverty by giving equal treatment
(Shad and et.al., 2019).
Legal structure: This consider unincorporated institutes, trust, charitable institution and
others. Oxfam is working under trust structure where it works for social welfare.
Explanation of size and scope of range of different type of organization
Basis Private Public Voluntary
Name and types Tesla is profit making
organization that is
operating their activity
by providing range of
product in auto mobile
sector.
BBC is non profit
making company that
provides up to date and
real information to
people for increasing
awareness.
Oxfam is non
governmental
company that works
for removing the
poverty.
Size and scope This is larger is size
where it bring new
technology and
innovation in their cars.
This is medium size
organization that is
managing all activities
and functions.
Oxfam is small size
organization where
people are working for
social welfare.
Objectives To increase the
profitability ratio by
To increase the living of
people with providing
The object of Oxfam is
to increase the living

comparing with
competitors and
developing the brand
image.
programme, educational
information and
entertaining people in
the world.
standard of people by
providing equal rights.
Analyse structure, size and scope of different organisations link to business objectives and
offerings of organisation
From above research it is to be analysed that different business organisations have
distinct size, structure and scope that will helpful to achieving business objectives and also
developing products and services to attracts customers. In terms of private organisation the size
of the company varied as per their legal structure and sale the products and services as per their
size and scope. For instance if a organisation is operated by a sole proprietorship than they serve
the products and services to local area for gaining limited amount of products. In this company is
considered as a large size business that offers the huge amount of products and services for
fulfilling their objectives related to customer satisfaction and more profits. In this public
organisation is also considered as a large size but their main motive is to be welfare of society
and it can be fulfilled appropriately. In this voluntary organisation structure is based on their
collecting amount from different individuals, organisations for attaining their objectives related
to welfare of people of society and enhances their living standards.
TASK 2
The interrelationship of the various functions within an organisation
In business organization different functions such as HRM, marketing, finance, operation,
manufacturing and others which are important to perform for increasing sale and profitability. In
relation to Tesla appropriate structure is followed:
Functional structure – This structure is mainly uses in large size organisation where it
starts with positions with the high responsibility at the top. In this, employees are organised as
their skills, capabilities, and talent which can help to operate the all functions and manage the
activities (Dee, and et.al., 2019).
Horizontal and Flat: Both name are defining as same structure that fits companies with
few level between upper level management and employees level. This mainly adopted by start

ups and then converted in to large organisation. This can help to operate and manage the
business activities and complete the task effectively.
From the above Functional structure is followed by Tesla as it is large size organization
where roles and responsibilities of employees are allocated in to different department as per their
skills and talent which helps to attain the business goals and objectives.
Interrelation of functional structure with different functions
Finance with HRM – HRM means human resource department which is required in
organisation for filling the vacancy and getting work done from employees. Tesla is following
functional structure which is interrelated to finance and HRM department. If there is any
vacancy in finance department such as cashier, accountant, tax consultant, finance manager etc.
are selected by Human resource department which can help to perform all functions effectively
which helps to attain business goals. This is important for human resource management to
identify the vacant position in particular department and conduct the interview rounds for
selecting the best employees in order to fill the vacant post and get complete the task (Kitsios
and Kamariotou, 2019).
Marketing with production: The marketers of organization conduct the market research
for analysing needs of their customers and provide the product accordingly that helps to increase
sales. Tesla is following functional structure where marketing maintains good relation with all
department and customers. This can help to know the new trend and share with production
department which can help to provide the products and services accordingly. Thus, organization
can attain its business goals and objectives effectively (Jin and Choi, 2019).
Interrelation with functions in attaining objectives
It has been explained as the functional structure of Tesla is related with organizational
objectives by focusing on each function and activities. The marketing department understand the
needs of their customers and share with production department which can help to increase the
sales and performance in competitive market and develop the business performance. Moreover,
finance department provides the funds by allocating expenses in each department helps HRM
functions to satisfy their staff and manage the all organizational functions in changing
environment that acts as accomplishment of objectives.

Analyse advantage and disadvantage of interrelationship between organisational function and
their impact on organisational structure
From above explanation it is analysed that interrelationship between the several
department within organisation containing some types of advantages and disadvantages that can
affect the structure of business enterprise. It includes an interrelationship between finance and
HRM, Marketing and production where they are working together to attaining the goals
effectively and on time. It helps in generating high profitable results so that firm will gain the
competitive advantage. It also increase productivity and employees skills so that high profitable
results can be enjoyed. On the other hand it also includes disadvantage that it creates
misunderstanding in completing the task and also conflicts among the departments due to this
task cannot be achieved on time.
D1 Provide critical analysis of complexities of different types of business structure and
interrelationship of different organisational functions
By above analysis it is critical analysed that there are several types of business
organisation such as private, public and voluntary organisation all have different structure as per
the objectives. In this interrelationship between the departments is possible and effective only on
the large organisation because small companies like sole trader, partnership need huge amount
that impacted their profit margin. In this it also impacted positively to large companies to
attaining the targets smoothly and efficiently.
TASK 3
Macro environmental factors with positive and negative impacts
For running a business properly and developing the activities there is need to analyse the
environment which can help to understand which factor can impact on their operation. The
analysis of environment in relation to different organizations are as defined:
PESTLE analysis: This is a framework which uses by organization to conduct the analysis and
know how such factors are affecting their business. The explanation is given below:
Pestle of Tesla:
Political: This factor is focusing on government regulation tax rates, stability, etc. that
has impacts on business operation. This is important for organization to follow all regulations
which are formulated by government.

 Positive impacts: In UK, after Brexit tax rates are reduced which is opportunity
for Tesla to increase their sales and performance by getting raw material and auto-
mobile parts (Lüdeke‐Freund, Gold and Bocken, 2019).
 Negative impacts: Changing in government of UK and other country where
Tesla is distributing their cars, can affect the negatively.
Economical: This factor is related to economy which involves inflation rate, interest rate,
population growth etc.
 Positive impacts: After Brexit, rate of interest is being reduced and all legal
formalities on taking loan being reduced which impacted on Tesla to increase
increase production and performance by expanding business.
 Negative impacts: Due to Covid-19 employment rate of UK has been reduced
which impacted negative as buying behaviour of customers have reduced.
Social: This involves population growth, cultural trends, career attitude, and health
consciousness (Senyo, Liu and Effah, 2019).
 Positive impacts: In UK, population is increasing day day which provide a
business opportunity to Tesla to increase sales of their auto mobile and increase
the performance.
 Negative impacts: Due to changing culture trend of customers demand is also
changing which create the challenge for organization to operate their business
effectively.
Technological: This factor is related to potential return on investment, technological
maturity, target market and innovation that are needed to consider in organization.
 Positive impacts: By using this factor Tesla is bring new technology in their
electric cars and distribution channel which can help to operate the business and
increase the profitability.
 Negative impacts: High cost and risk can be arises for chosen organization in
adopting new technology, so it has negative impacts on business operation.
Legal: Legal framework has huge impact on working of an organization. Labour laws,
product and advertising standards, customer laws and rights, safety standards etc. are taken into
consideration which focusing on legal factors of external environment. Bentley has following
impact of these factors-

 Positive Impact: Bentley follows all rules and regulations imposed by government for
quality and safety of auto-mobiles, pollution law, employee laws etc. which ensures
sustainability of firm in longer run and increases employee retention as well as ensures
customer satisfaction (Cusumano, Gawer and Yoffie, 2019).
 Negative Impact: Company is operating globally and different countries has different
laws imposed which makes it quite complex for an organization to withstand. Firm even
faces some limitations and its production costs is increased due to this factor.
Environmental: As name states, environmental factors are considered while evaluating
it, which includes, pollution, weather changes, climate, business ethics, legislations related to
environment etc. Impact of it on Bentley are as follows:
 Positive Impact: While considering the issue of increasing pollution stated firm
introduced 'Electric Vehicles' which was invented taking into consideration the health of
customers and at the same time increases the brand image of company (Poponi and et.al.,
2020). Negative Impact: For achieving business goals it has become very important for the firm
to satisfy social or environment friendly goals of society, that is, business is to be
managed is such a way that reduces or minimizes negative impact on environment. This
increases expenditure incurred in company.
Pestle of BBC:
Political: It is showing the relation with government activities and regulations which are
needed to follow.
 Positive impacts: The government of UK is stable which is supporting BBC
organization and giving the permission to operate their business regularly by
providing right information (Kiss, 2019).
 Negative impacts: If government has been changed then there is high threat of
running such organization.
Economical: For running a business there is need to focus on economic growth,
inflation, disposable income, and exchange rates.
 Positive impacts: The economic growth of UK is stable where BBC is taking
opportunity for managing all activities and function. This also increase the
employment by giving job opportunities to people. Thus, it has positive impacts.

 Negative impacts: Due to Covid-19, it become challenging situation for BBC to
conduct research and provide right information as people are getting infected
from virus.
Social: Social activities, age distribution, cultural trend and career attitudes are involved
in such factor which are focusing by BBC to operate the business.
 Positive impacts: BBC is focusing on customer demand as provide information
to people, entertainment programme for kind and youngsters and others which
impacts positive on organization.
 Negative impacts: Not focusing on needs of customers and changing in culture of
people can create the challenge for chosen organization and affected the business
negatively (Ansoff and et.al., 2019).
Technological: To bring innovation and new process can be effective activities for
organization. BBC is considering this factor that are as defined:
 Positive impacts: By using new technology and satellite system BBC is reaching
to the targeted customers where it provides important information which is highly
linking by customers and developing the brand image.
 Negative impacts: This might be create risk and low image if functions are not
properly managed.
Legal: In this, organization is dealing with laws and regulations that are important to
follow for managing all activities.
 Positive impacts: BBC is public sector organization that is following all
regulation which are made by government in UK and developing the business
performance.
 Negative impacts: In case of breach of regulation and not following government
regulation can impacts on BBC negatively.
Environmental: Herein, organization need to focus on environment protection regulation
and activities that can help to manage the good performance (Ojansivu, Hermes and Laari-
Salmela, 2020).
 Positive impacts: BBC is following all environmental regulation also running
some educational programme which can help to increase people insights
regarding environment safety.

 Negative impacts: In case of not following regulation and not participating in
CSR activities can be very challenging for organization and impacts negatively on
operation.
Apply appropriately PESTLE model to support detailed analysis of macro environment
It is critically evaluated that PESTLE analysis can be referred as a planning tool to
evaluate the different macro external factors of the market for the company. It identifies the
crucial external factors of the business companies. As the PESTLE analysis of TESLA and BBC
determines the different external factors. As the different government regulations are imposed
which creates a impact on the business activities of the companies. As the different economical
rates are are implied on the activities that are carried by the company. The business companies
are using technological tools for the expansion of the business activities and their business to
generate the revenue and determine the macro environmental factors of the company to analyse
the market demand and supply the product and services according to the customers.
Internal environment: This can be explained as analysis of internal environment in
which organization can run their activities and performance. For this SWOT analysis is needed
which states strength and weakness of organization.
SWOT of Tesla
Strength Weakness
 Support from government and other
authorities that maintain good
performance.
 Tesla design different model and
features of cars (Schell, de Groote,
Moog, and Hack, 2020).
 This entity have control and
management on its operation and
deliver best quality of cars.
 Having many competitor such as Rolls
Royce, Aston Martin etc.
 Facing manufacturing and production
problems due to lack of suppliers.
 Selling of product at less prices that
hive low profitability.
Opportunities Threats
 Tesla is having enough skilled and  Less focus on distribution
 Occurrence of natural tragedy in

talented engineers.
 Focusing on new trend and demand of
customers.
 Getting feedback and bring changes in
innovation and production.
environment such as pandemic
 Shortage of batteries and high volume
production.
SWOT of BBC
Strength Weakness
 BBC is having good reputation in
market.
 This is the largest broadcaster where
more that 23000 employees are
working.
 This provides new and updated
informations to customers.
 This has biased views.
 New items on BBC touch sensitive
issues.
 High operating cost
Opportunities Threats
 This organization is getting more
involve in activities, research and
information which are important for
customers.
 Managing all information and functions
in changing environment.
 Increasing satellite channel.
 This is not profit making company that
face problem of government change.
 Stronger competition
TASK 4
Internal strength and weakness of specific businesses by defining interrelationship with external
macro factors
Interrelationship
basis
Strength Weakness

Political factor Tesla is following all regulation
which are formulated by
government which stated as
strength for organization to operate
their business effectively (Caldera,
Desha and Dawes, 2019).
If government of UK has been
changes then new regulation is
required to be follow by Tesla
which create the difficulties to
bring new regulation in entire
business.
Economic factor Due to increasing population of
UK, Tesla is increasing all
activities as many investors get
persuade to make investment by
checking strategies and process of
manufacturing which is point of
strength.
The impact of Covid-19 has
created the challenge for Tesla to
operate their business as people
get unemployment so they
buying behaviour has been
reduced.
Social factor Analysing new trend and
introducing products accordingly
Tesla is increasing their sales and
performance in changing
environment. The choices results
as profits for organization.
Due to changing choices, interest
and desires of customers in
buying cars reduces the sales of
selected organization that act as
weakness (Akter and et.al.,
2020).
Technological
factor
Brining changes in manufacturing
process and distribution is acting as
strength for Tesla as it manufacture
the number of auto mobile in less
time that depicts as point of
advantage.
Lack of training and educational
programme in employees within
organization can be challenging
situation for organization that
create the less profitable
situation.
Apply appropriately SWOT analysis to justify how to influence decision making
SWOT analysis help to identify the opportunities that enterprises take advantage of to
make higher profits. In which conducting a SWOT analysis will help or support to understand
the internal factors which shows the strength, weakness, opportunity and threat. These all factors
are shows the everything of the organisation and what they have to do make changes in the
company. They analyse the overall perception of the organization after it influence the decision

making for more improvement and encourage towards the success. It the research of internal
factor. In which organisation are responsible for it. After analysing the data organisations have a
great opportunity to make changes or improvement. SWOT analysis allows the enterprises to
identify the forces that influence in decision making, strategy or action, initiative which used or
support when its masking critical decisions of business. If organisation looking forward to
implementing new terms and conditions which invest money into research program and building
process and willing to making any significant change in enterprise or personal life. Which is
worth time period to conduct a SWOT analysis. It helps to others with in your company or
department which involve the active and worth able stake holders to help giving all
encompassing view rather than one individual person viewpoint in each and every section.
Critically evaluate impact of macro and micro factors upon business objectives and decision
making
This evaluation report takes the PESTEL analysis which have a significant impact on the
excellence which encourage towards the success of marketing activities such as environmental
factors which is consider in depth during the process of making a strategic plan which under
comes in marketing. These factor will be improving the success of the organisation marketing
campaign and the reputation of the particular brand in long term. Seeking more about macro and
micro factors and strategic marketing. The outcome of the performance gives the actual data
where they have to need changes and improvement because all these factor works as an external.
CONCLUSION
From the report it can be concluded that business environment is summarise as number of
activities and functions which can help to operate the business and develop the performance.
Different types of organization as private, public, and voluntary that have different size and
scope. Public company are non profitability, private are established for earning profit and
voluntary are established for doing some good work for people. The structure of organization are
related with different function such as HRM, marketing and finance that can help to increase the
performance by completing goals and attaining business objectives. Internal and external factors
are related to business environment that should be analysed by management by understanding
demand offering products as well as services.

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