Virgin Atlantic: Business Environment and Organizational Report

This report provides a comprehensive analysis of Virgin Atlantic's business environment, examining its organizational structure, purpose, and legal framework as a private entity. It contrasts Virgin Atlantic with public and voluntary organizations like the NHS and Barnardo's, discussing their distinct purposes, legal structures, and stakeholders. The report delves into the size and scope of these organizations, outlining their offerings, vision, and mission. It explores the growth of the international business environment and the relationships between organizational functions, such as administrative, marketing, and manufacturing departments, and their alignment with Virgin Atlantic's objectives. The report further analyzes the positive and negative impacts of the macro environment on Virgin Atlantic and conducts an internal and external analysis to determine its strengths and weaknesses. The conclusion summarizes the key findings and insights gained from the analysis.

UNIT 1. BUSINESS
AND BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Different Types and Purposes of Organisations....................................................................3
1.2 Size and Scope of various organisations...............................................................................6
1.3 the growth of the international business environment...............................................................8
.........................................................................................................................................................8
1.4 Relationships between organisational functions and their link with its objectives and
structure.......................................................................................................................................8
TASK 2............................................................................................................................................9
P4. Positive and Negative Impacts of the macro environment on Virgin Atlantic.....................9
TASK 4..........................................................................................................................................11
P5. Internal and External Analysis of Virgin Atlantic to determine its strengths and
weaknesses................................................................................................................................11
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Business Environment means the overall environment surrounding an organisation. It
includes internal, as well as external environment which effects and influence working of a
company (Hillary, 2017). While the internal environment is necessary for effective internal
management, the external environment takes all the outside factors into account which affects the
business. The current report is based on Virgin Atlantic, which is one of the biggest airline
companies in private sector, National Health Service (NHS), one of the prominent public sector
organisations in the UK and Barnardo's, which is a voluntary company in the UK. It covers
different types, sizes and scope of various organisations and interrelationships of different
functions within an organisation and how these link to organisational culture. The report also
includes both positive and negative impacts of macro environmental factors and determination of
internal strengths and weakness of a company.
TASK 1
1.1 Different Types and Purposes of Organisations
In a business environment, it is imperative that various different types of organisations
are analysed in relation to their purpose, legal structure and stakeholders. Such information
would allow organisations to conduct in-depth analysis of each type of organisation and gain a
better understanding. Various different types of organisations are discussed below:
Private Organisation:
These organisations are the ones which are incorporated and incepted to earn profits.
These could be corporations, partnership companies or private agencies. These companies could
be self sustaining or non-federal entities. The biggest example of one such organisation is Virgin
Atlantic which is owned by Richard Branson and since it inception, the firm is successful of
being one of the prime choices of customers to choose while travelling (Hamilton and Webster,
2018). The purpose, legal structure and stakeholders of the company are mentioned below:
 Purpose of Virgin Atlantic:
The organisation provides effective commercial aviation services to its customers
globally. These destinations include, Asia, Africa, the United States, Middle East and Mexico.
Along with airline services, this company offers various other services like car, hotel, holiday
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booking facilities etc. the firm is currently working on expanding its business operations
providing more efficient services to its service users globally.
 Legal Structure:
The legal structure of Virgin Atlantic supports all the legal framework that of a private
organisation where the company is completely owned by a single entity yet have shareholders
(Quinlan and et. al., 2019). The company works to earn trust of their shareholders and effectively
gain profit which is them distributed among these entities as per their share in the company.
These individuals have limited responsibilities for Virgin Atlantic' s financial liabilities
according to their shareholdings' value.
 Stakeholders:
The most prominent stakeholders of Virgin Atlantic are, customers, shareholders,
employees, community, etc. The organisation has a separate yet crucial role for these
stakeholders. For instance, they are required to provide cost-effective yet quality service to their
customers and at the same time the company is responsible to provide an impressive value of
shareholders' investment in the firm. Similarly, Virgin Atlantic has responsibilities towards
community too and is required to operate in ways which provides welfare to people along with
the business.
Public Organisation:
These organisations operate in the public sector and are operated and owned by the
Government. The existence of these organisations is merely to provide its effective products and
services to the citizens of their nation. They do not seek profit like private organisations. One
such public organisation is National Health Services, UK, which provides effective healthcare
services within the country. Its purpose, legal structure and stakeholders are mentioned below:
 Purpose:
The purpose of NHS is to provide social and healthcare services to people of the UK.
These services include, Emergency Care, Dentists, Pharmacies, Mental Health Services, etc. This
organisation provides a range of services and work consistently to provide effective care to the
public (Tregear, 2015).
 Legal Structure:
The legal structure of the NHS covers various legislations like Health and Social Care
Act, 2012 and Equality Act, 2010. Both these legislative acts legally bound the organisation to
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provide equal health services to the people regardless their race, creed or status. Moreover, this
organisation also complies with equality law which ensures equal treatment to employees.
 Stakeholders:
The stakeholders of NHS include, patients, suppliers, special interests’ groups, local
council, Academy for Healthcare Science, National School of Healthcare Science, Healthcare
Science Professional Bodies, etc. who influence the working of this organisation and encourages
effective healthcare services to the public (Fan, Lau and Zhao, 2015).
Voluntary Organisations:
Those companies are formed by people which depends upon regular or occasional
volunteers to run their business operations and it is uncertain that these organisations have a paid
staff. Categorisation of these organisations is set by State autonomies or aids from various
philanthropies. Barnardo's a voluntary organisation which was founded in 1866 for children
welfare. Its purpose, legal structure and stakeholders are described below:
 Purpose:
Barnardo's provide effective services and healthcare facilities to children. These services
include adoption and fostering, protecting children from sexual exploitation, domestic violence
and reduction of child poverty. With such positive deeds, the company encourages people and
volunteers to effectively contribute in their causes.
 Legal Structure:
The legal structure of Barnardo's is influenced by the legal framework which is set for
voluntary organisations. Its legal structure consists of various short-term objectives, low income
levels and is not structured properly as to acquire regular employees. This is because this
company encourages various volunteers to join the cause and work as per their will without any
favour in return.
 Stakeholders:
Barnardo's stakeholders are its patients, children in need, its volunteers, government and
various organisations like Norfolk County Council and Newport City Council (Strategic
Partnership, 2019). These stakeholders are associated with the company to assist and guide the
organisation to transform its services given to the children and provide a better and safe
environment to them.
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1.2 Size and Scope of various organisations
All the organisation mentioned above exist for different purposes. However, it is crucial
to determine their offerings, size and vision and mission of these organisations to better
understand how these contribute in their purpose (Crane and Matten, 2016). These aspects for all
these organisations are mentioned below:
Virgin Atlantic:
Offerings Organisation's Size
and Scope Company's Vision Company's Mission
The company offers
innovative and
effective aviation
services with
outstanding and
effective facilities.
Along with this, it
offers personalised on-
board services to
customers as a strategy
to retain them further
with the company.
With almost 9,000
employees, the
company has managed
to cover a worldwide
area with so many
locations and build a
strong customer base
in each country of its
operation (Virgin
Atlantic Airways'
Competitors, Revenue,
Number of Employees,
Funding and
Acquisitions, 2018).
Vision of Virgin
Atlantic is to provide
its robust and
transform the aviation
business for good.
Another vision of this
firm is to provide safe,
secure and consistent
services to all its
customers.
The mission of the
organisation, as per the
owner Richard
Branson, is to keep the
innovation consistent
and provide more
effective offerings and
facilities to its global
customers.
National Health Services (NHS):
Offerings Organisation's Size
and Scope Company's Vision Company's Mission
NHS provides all the
facilities covered under
social and healthcare
to the people of the
Almost 1.5 million
people are associated
with NHS to provide
effective and
The company's vision
is surrounded on
providing better care,
better value and better
The mission of NHS is
to provide quality
services by employing
latest and more
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UK. It covers all the
areas of healthcare
facilities and provides
effective and
technologically
advanced medical
assistance to all the
patients requiring the
same.
necessary medical
treatment to patients
and the firm is
expanding its
operations to reach
areas where there are
less-effective facilities
for the people (How
many NHS employees
are there?, 2018).
health through gaining
access to healthy as
well as infection-free
methods which
contributes to better
health of its patients.
effective methods,
equipments and skilled
practitioners who
could provide even
more robust facilities
and healthcare to
public.
Barnardo's:
Offerings Organisation's Size
and Scope Company's Vision Company's Mission
Barnardo's provide
effective services
which are centralised
on betterment of
children. They provide
a range of facilities
which help young
people, protect
children, give them a
better and safe
environment, etc.
There are more than
600 outlets of
Barnardo's in the UK
donating valuable
accessories, clothings
and quality
possessions for
children and young
people (The Retail
Department, 2019).
The organisation
operates in all of UK
and is considered one
of the most effective
voluntary
organisations in the
Vision of this
company is
concentrated on
betterment of each and
every child in need
and company is
focused on expanding
its operations in ways
which ensures benefits
of each child.
The mission of the
firm is to channelise
each of its resource
towards giving
effective assistance to
children and provide
them with
environment which
fosters their growth,
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country,
1.3 the growth of the international business environment.
International business has been subjected to effective and robust growth through the
years. Recently, with rise of advancements in technologies and effective transportation system
worldwide, international environment has seen appropriate and significant growth. One of the
main reason for growth in international business environment is that domestic markets have
saturated effectively. Companies seek appropriate growth in overseas market due to this factor.
Another factor is the opportunity present globally for companies. Various developing countries
are effectively blooming as a result to which, various organisation seek to invest in foreign
market.
1.4 Relationships between organisational functions and their link with its objectives and structure
It is essential to determine all the functions of an organisation and how these are aligned
to provide effective support to the firm in accomplishing its objectives (Hunter, Saunders and
Constance, 2016). The functional structure of Virgin Atlantic is mentioned below:
There are various departments within the organisation that carry diversified functions for
the company. These functions and their interrelations with each other is discussed below:
 Administrative and Legal Department:
This department carries out all the legislative and administrative functions for Virgin
Atlantic (Trevino and Nelson, 2016). This department is required to align its operations with
other departments to ensure effective and authenticated flow of paperwork and compliance of
each department with their set legislations.
 Marketing Department:
One of the most crucial departments for Virgin Atlantic is Marketing. It is responsible for
analysing the market and develop strategies which assists the company in building its market
share and customer base. These functions are crucial for the company to communicate their
services to the masses (Zur Muehlen and Shapiro, 2015).
 Manufacturing Department:
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It carries out duties of building the infrastructure and air planes for the company in ways
which ensures maximum security and comfort to its customers. Along with this, it is also
required to research the most prominent and technologically advanced methods and processes to
ensure its that customers get the most effective services possible (Beatty, Samuelson and Abril,
2018).
 HR Department:
Any organisation which aims to provide robust facilities and offerings to its customers
are required to be supported by skilled and talented employees. The HR department within
Virgin Atlantic plays the function of recruiting, selecting and managing skilled and talented
personnels so that they contribute up to their full potential towards achieving organisational
objectives.
All these departments and functions are interrelated. For instance, HR department is
required to manage employees of all the other units and provide effective training to them to
enhance their marketing and engineering skills. In the same manner, Marketing department
interrelates with sales and finance departments to ensure the most effective strategy to market the
products in the market. The most advantageous aspect of these interrelation for the company is
that the policies and procedures ensures collective growth for each department limits the scope of
conflicts of interest. This way, it ensures employee engagement and each employee, process and
equipment are effectively aligned towards providing the most effective service to customers.
TASK 2
P4. Positive and Negative Impacts of the macro environment on Virgin Atlantic
Within each organisational setting, external environment plays a prominent role in
determining aspects which influences the operations of the company. Virgin Atlantic operates
globally and for that firm, PESTLE analysis is being used to determine external pointers that
have an impact on the company (Stacey, 2016). This analysis is mentioned below:
 Political Factor:
This factor is surrounded upon the political stability which effects the company. While
political stability favours an organisation, political instability induces challenges for the firm. For
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instance, within the UK, Virgin Atlantic had been subjected to political instability recently after
the events of Brexit. It caused quite an uncertainty within the policies within the nation which
negatively affected Virgin Atlantic. However, there are still negotiations going on regarding
European Flying rights after Brexit which seems likely to pull through. Moreover, there are
various nations in Asia, Middle East which are politically stable and ensure effective stability
and consistency in their policies for the firm.
 Economical Factor:
This factor is completely centralised upon the economic performance of the country.
Post-Brexit, the UK witnessed reduction in the value of Pound, which reduced the standard of
living of people in the country. Such depreciation of currency forced the company to reduce its
cost in order to sustain its customer base. However, on the bright side, Brexit also caused interest
rates and fuel prices to drop. This provided ease to Virgin Atlantic in conducting its operations
within the country.
 Social Factor:
This factor is completely centralised on the social trends which influences operations of
the company. This factor has been very favourable for Virgin Atlantic as there has been an
extensive enhancement in travelling and this trend has caused a substantial increase in customers
travelling via this company. However, quite recently, there have been certain strikes by the pilots
and other crew members of the firm which have negatively affected the company and its
employee retention (Virgin Atlantic Christmas strikes – will the industrial action affect my
flight?, 2019).
 Technological Factor:
With enhancements in technology, each company is required to follow the trend and
modify its operations in a way which could be technically advanced and could satisfy the
ongoing technological needs of its customers. The firm invests heavily in R&D and its
organisational culture encourages innovative and technologically advanced practices. This
enables Virgin Atlantic to be quite ahead in using various effective techniques that ensures
appropriate safety and maximum comfort to the customers.
 Legal Factor:
This factor undertakes all the legislative elements which are required to be complied by
an organisation to ensure government support and favouring legal environment. There are
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various legislative acts like Equality Act, 2010 and Employment and Labour Law, 2018 which
allows the firm to function in such a manner ensures maximum employee commitment. The
legislative environment of UK as well as the localities it operates it provide the company utmost
legal support to conduct its operations in the company effectively. However, the recent pilot
strikes and ongoing legal tiffs with the employees have caused quite a negative environment in
the company.
 Environmental Factor:
With ongoing environmental preservation, each organisation is required to work in ways
which helps the company in ensuring appropriate conservation of natural resources. It is part of
their Corporate Social Responsibility that companies effectively accomplish set standards that
fosters growth of environment. This factor induces force on Virgin Atlantic to reduce CO2
emissions from their air planes. In addition to this, the company is also required to abide by
Environment Act, 1995 which encourages ethical practices towards the environment, and which
has forced the company to implement effective waste management systems to reduce waste
production from its organisations.
TASK 4
P5. Internal and External Analysis of Virgin Atlantic to determine its strengths and weaknesses
For an organisation as big as Virgin Atlantic, it is crucial to determine internal and
external aspects which could be strengths and weaknesses of the company and could later help in
determining its opportunities and threats (Ji-fan Ren and et. al., 2017). For this, SWOT analysis
is the most effective method which is described below:
BASIS DESCRIPTION
STRENGTHS
 The biggest strength of Virgin Atlantic is its unique branding
strategies and innovation in its products and services which helps
in gaining maximum attention of customers.
 Its strong brand image creates a positive perception about its
offerings in the minds of customers.
WEAKNESSES  The company has failed in differentiating its services from rest of
its competitors within the country.
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 Still lacks the global presence like other competitor companies like
British Airways.
OPPORTUNITIES
 One of its biggest opportunities is the new runway at Heathrow
which would allow more of its flights to operate simultaneously.
 More customers are indulging themselves in travelling which
provides it opportunities to give them enhanced and more effective
services in future.
THREATS
 Brexit is one of its biggest threats as there have been a loss in
national customers and the ongoing financial challenges that is
faced by the firm.
 Intense competition from companies like Emirates, British
Airways and Lufthansa are serious threat to the company.
P6. Interrelation of strengths and weaknesses of Virgin Atlantic with external macro
environmental factors1Compare with another company of similar status
There is an effective interrelation of strength and weaknesses of the company with its
external environmental factors. This interrelationship is mentioned below:
Political Factor:
It concerns with political stability of the country in which Virgin Atlantic operates. All
the policies and regulations that affect working of company are included in macro environment, Strengths: Political stability allows the company to formulate consistent long-term
internal policies which would provide consistent benefit to the company. Whereas for
Britsih Airway si supoerireo because political ….. Weaknesses: Areas like UK with political instability would force the firm to bring
consistent changes within its structure to align itself with that of the government. BA
Economical Factor:
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