Business Environment Analysis: Functions, Macro Factors & SWOT

This report provides a comprehensive analysis of the business environment, focusing on organizational functions within public, private, and voluntary sectors, and their legal structures. It examines the scope and size of different organizations and evaluates how their structure, size, and scope r...Read More

Business And Business
Environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY ..................................................................................................................................3
P1 Describe about the different types and purposes of public, voluntary and private sectors
and legal structures .....................................................................................................................3
P2 Describe about the scope and size of the range of different kinds of organisations .............4
M1 Evaluate how the size, structure and scope of dissimilar organisation link to the business
business objectives and product and services offered by the organisation ................................5
D1 Analyse into critical terms about the complexities of dissimilar kind of business structures
and the interrelationship of dissimilar functions of the organisation .........................................5
P3 Describe about the relationship between different organisational functions and in which
manner they link to the organisational structure and objectives ................................................6
M2 Evaluate the advantages and disadvantages of interrelationship between functions of
organisation and the impact that can have on the structure of organisation ..............................6
P4 Identify about the negative and positive impacts the macro environment has on the
operations of business with support of examples .......................................................................7
M3 Apply properly the model of PESTEL to support the detailed analysis of the macro
environment within the organisation ..........................................................................................8
D2 Critically asses the impacts that both micro and macro factors have upon the objectives of
business and decision making ....................................................................................................9
P 5 Conduct the external and internal analysis of particular organisation for identifying the
weaknesses and strengths............................................................................................................9
P6 Explain how strengths and weaknesses interrelate with external macro factors.................11
M4 Apply appropriately SWOT/TOWS analysis and justify how they influence decision
making.......................................................................................................................................12
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Business environment refers to the sum of all the things which are external to firms and
industries that affect their operation and organisation. It basically encompasses the climate,
social, economic, institutional or political in which operations business are conducted. In the
present report, there are different kinds of organisation is taken into consideration which include
public, private and voluntary sectors as well(Amankwah‐Amoah and Syllias., 2020). The
present report will cover discussion about different types and purposes of organisation with the
legal structures and also about the scope and size of the range of different types of organisation.
In addition to this, the report will cover analysis about the relationship between different
organisational functions and also about the link between organisational objectives and structure
as well. Moreover, the report will cover discussion about the positive and negative impacts the
macro environment has on the business operations. The report also consist of internal and
external analysis of particular organisation for identifying the strengths and weaknesses and also
about the interrelationship between external macro factors, weaknesses and strengths as well.
MAIN BODY
LO3 and LO4 (Covered in fact sheet)
P4 Identify about the negative and positive impacts the macro environment has on the operations
of business with support of examples
As the macro environment help in terms of financial aspect and also gives a base idea
about the business due to which it is easier for the businesses to analyse that whether they can
survive into this economy or not. The macro environment also talks about the challenges and
threats which a company can face in their upcoming period of time so it directly impacts the
daily activities of the organisation. There is also a kind of negative impact as well due to which
business can't perform into effective terms as it also slow down the way of working as well(Guo
and et.al., 2018). For instance, if a business want to achieve the qualitative factor of the
organisation within the financial year then it is important that to consider the unforeseen
situations as well so that they can properly take decisions for it into positive manner.
Political Factor positive impact: As the UK country is very stable and strong in terms
of political level then it has positive impact on the performance of Cadbury organisation.

Negative impact: As the company is dealing in terms of lots of sweet and sugar
products so government has to think accordingly that it will not impact the health of customers
into negative terms so they have to made policies accordingly for it.
Economic Factor positive impact: UK country is one of the fastest growing economy in
terms of economic development where the Cadbury company has the best opportunity to
enhance their sales and profits into positive terms.
Negative impact: With the changing period of time customers preferences have been
changed so this will impact the performance of Cadbury company.
Social Factor positive impact: The company has developed lots of products according
to the requirements of customers so it will impact into the positive terms.
Negative impact: As the customers taste and preferences have been changed according
to changing period of time then this will have negative impact on the sales of products.
Technological Factor positive impact: As UK country is very advanced in terms of
technology then it gives the competitive advantage over the other rivalry companies(Hamilto and
Webster., 2018).
Negative impact: The use of technology act as very costly in terms of nature then it
affect the daily operations of the business into negative terms.
Legal Factor positive impact: It is the organisation who provides the goods and services
by following proper rules and regulations as well.
Negative impact: When there is increment into the salary and wages then it will affect
the profits of the company into negative terms.
Environmental Factor positive impact: Cadbury is the company who uses new tools
and techniques which help in terms of reducing the negative impact on the environment.
Negative impact: It has been observed that changes in the environment also affects the
way of working of the company so they have to made changes in the use of technologies.
M3 Apply properly the model of PESTEL to support the detailed analysis of the macro
environment within the organisation
Within the organisation of Cadbury, it has been observed that to analyse the macro
environment it is very important that to conduct the PESTLE analysis. From the perspective of

political factor, in context to UK country, the change of government from the labour party to
conservative is also bound to influence the operations of Cadbury company. The imposition of
taxes also the another political factor which will determine the how the Cadbury manages it
payment and investment to its shareholders(Hans., 2018). From the economic perspective, the
economic downturn affects the plans of Cadbury expansion. From the social perspective,
Cadbury is the company which is the result of social factors. From the technological perspective,
technology plays a significant role in terms of production and process over the years. From the
perspective of legal factor, it is important to follow the rules and regulations so that they can
properly expand themselves. From the environmental perspective, it is very important that to
follow the environmental regulations so that Cadbury can make changes in their use of raw
materials and from the packaging and production perspective as well.
D2 Critically asses the impacts that both micro and macro factors have upon the objectives of
business and decision making
There are certain micro factors such as company's suppliers, customers, resellers and
competition. There are also certain macro factors such as demographic, natural, economic,
political, technological and socio cultural conditions as well. As these factors keeps changing
according to changing requirements and conditions as well where the company's objectives have
been decided accordingly for it(Hein and et.al., 2019). As the way of working of businesses has
totally changed so its very important that to take the decisions accordingly for it into the right
terms. So the overall impact is into the growth perspective for the Cadbury company due to
which it becomes easier to take the right kind of decisions as well. l
P 5 Conduct the external and internal analysis of particular organisation for identifying the
weaknesses and strengths
The external and internal analysis of Cadbury company has been defined into the
following manner in order to identify the strengths and weaknesses as well.
External Analysis: Within this kind of analysis, VRIO analysis is also taken into
consideration which has been defined into the following manner:
Resources Value Rare Imitation Organisation Competitive

Advantage
Talent to
manage
regulatory and
legal
obligations
Yes No Can be
imitated by
competitors
Yes Not critical
factor
Opportunities
for brand
extensions
Yes No Can be
imitated by
competitors
Brand
extensions will
require the
higher
marketing
budget
Temporary
competitive
advantage
Supply chain
network
flexibility
Yes Yes Near
competitors
also have
flexible supply
chain and
share some of
the suppliers
Fully utilised Keeps the
business
running
Channel
management
and sales force
Yes No Can be
imitated by
competitors
Still there is
lot of potential
to utilise the
excellent force
Can provide
the sustainable
competitive
advantage
Internal Analysis: Within this kind of analysis, SWOT analysis can be conducted in
order to identify strengths and weaknesses which has been defined into the following manner for
the Cadbury organisation(Hock-Doepgen and et.al., 2021).
STRENGTHS
 It has a strong brand image into the
international market
WEAKNESSES
 It has the limited product range where
the brand offers the variety of

 It is a powerful brand which has well-
established operations which is not
limited to the United Kingdom country
 Cadbury is the company which act as
the international food giant and the
revenue earned by the company also
results into the profits on the larger
scale.
confectionery products
 Cadbury company has to battled with
the product recalls
 There are many consumers who
complained that the Cadbury products
taste into different manner. This lack of
rights means that it will not be able to
expand its core chocolate range in the
United States.
OPPORTUNITIES
 Cadbury is the company which comes
out into the emerging markets
 As the company has limited product
range which means one lucrative
opportunity for the multinational
confectionery might expand the product
range as well.
THREATS
 When sugar tax has been implemented
into new areas then it would increase
the end cost of confectionery for the
consumers.
 According to the studies, it has been
observed that there are numerous
negative effects of sweet and processed
foods such as chocolate. When the
consumer preferences have been
changed due to health consciousness
reason then it will act as the serious
decline in the revenue for Cadbury
company.
In this manner, Cadbury company can identify their strengths and weaknesses through
conducting the SWOT and PESTLE analysis.
P6 Explain how strengths and weaknesses interrelate with external macro factors.
There is a kind interrelationship between strengths and weaknesses with the external
macro factors which has been defined into the following manner:

The main strength of Cadbury company is its brand image and its local presence into the
international market. The company's strength point creates an impact on the economic,
technological, Political and social factors as well This impact is into such context which lead the
company towards further development and growth as well. The main weakness of the company
is its limited product range and product recalls(Möller and et.al., 2020). In addition to this, the
lack of rights also lead towards the slow development of the company. The company's
weaknesses also has an impact on the external macro factors due to which it is easier for the
company to run themselves into new market because of its political stand. As the company has
its limited product range but its strong brand image also insist people to try the product which
will lead towards growth in revenue and profits as well.
As the consumers taste and preferences changes on the continuous basis but it attract the
attention of all age kind of group of people. The technological factor also help the company to
grow themselves into positive manner(Nudurupati and et.al., 2021). There are certain rules ad
regulations of the company which also help the company to maintain a good relationship with
their consumers which ultimately lead towards maintaining a strong brand image into the market.
When company conduct their daily operations by considering environment factor then it act as
support system to maintain its presence at the global level. So this is a kind of interrelationship
between external macro factors and strengths and weaknesses as well.
M4 Apply appropriately SWOT/TOWS analysis and justify how they influence decision making.
The SWOT analysis help the Cadbury company in order to identify their strengths,
weaknesses, opportunities and threats as well(Ryu., 2019). This is the reason due to which
company can identify what further steps needs to be taken and how to make the decisions more
stronger and to the point as well. It also influences the decision making due to which it makes the
working of Cadbury company more smoother and to the point as well.
CONCLUSION
The above stated report concludes that business environment plays a very significant role
at the organisational level. Within this competitive world, there are different kinds of
organisation which are from different sectors such as private, public and voluntary as well. It has
been concluded that there are different kinds of organisation who have different sizes and scope
as well. It has been determined that every organisation has their own objectives and also there

are different kinds of products and services which has been provided by them. There are different
kinds of organisational functions and also they have link between the organisational structure
and objectives as well. There are certain positive and negative impacts that the macro
environment has on the operations of business which has been supported by certain kind of
examples. For identifying strengths and weaknesses of the organisation it is important that to
conduct the internal and external analysis of the particular organisation. There are certain kind of
strengths and weaknesses which has interrelationship with the external macro factors. So at the
organisational level, it is very important that to conduct the analysis into specific terms so that
the organisational objectives can be achieved into successful terms.

REFERENCES
Books and Journals
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Arsić and et.al., 2018. Family business owner as a central figure in customer relationship
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multivariate configuration. International Journal of Business Innovation and
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Belyaeva, Z., 2018. Business environment challenges and trends for contemporary SMEs in
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Brinkerink and et.al., 2020. Family business or business family? Organizational identity
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Çera and et.al., 2019. The effect of business enabling policies, tax treatment, corruption and
political connections on business climate. Acta Polytechnica Hungarica, 16(4), pp.113-
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Cherunilam, F., 2021. Business environment. Himalaya Publishing House Pvt. Ltd.
Gregory and et.al., 2019. Developing e-commerce marketing capabilities and efficiencies for
enhanced performance in business-to-business export ventures. Industrial Marketing
Management, 78, pp.146-157.
Guo and et.al., 2018. Strategic positioning, timing of entry, and new product performance in
business-to-business markets: do market-oriented firms make better decisions?. Journal
of Business-to-Business Marketing, 25(1), pp.51-64.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Hans, V. B., 2018. Business environment–conceptual framework and polices. International
Educational Scientific Research Journal, 4(3), pp.67-74.
Hein and et.al., 2019. Value co-creation practices in business-to-business platform
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Hock-Doepgen and et.al., 2021. Knowledge management capabilities and organizational risk-
taking for business model innovation in SMEs. Journal of Business Research, 130,
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Möller and et.al., 2020. Networks, ecosystems, fields, market systems? Making sense of the
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