Business Environment: Types, Functions and Analysis Report

This report provides a comprehensive analysis of the business environment, focusing on different organizational types (public, private, and voluntary), their sizes (micro, small, and medium/large), and legal structures, using Virgin Money, Tesco, and Cancer Research UK as examples. It examines the relationships between organizational functions (marketing, finance, HR, and operations) and their alignment with business objectives. The report also delves into the positive and negative impacts of the macro-environment (PESTEL analysis) on business operations and conducts an internal and external analysis to identify strengths, weaknesses, opportunities, and threats. A TOWS matrix is utilized to illustrate the interrelation of these factors, providing a strategic overview of the business environment and its implications.

BUSINESS AND THE BUSINESS ENVIRONMENT

Executive Summary
The aim of this report is to get a thorough knowledge and understanding based on the chosen
business and the functions that are carried out with the wider business environments,. Focus has
been laid on the various types of organizations, their sizes and scopes and the way they seek to
operate them. This has helped to explore the wide range of opportunities and relationship among
the organizations followed by the external environment influence and impact.
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Table of content
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Introduction
Business environment relates to both the external and internal factors that influence the business.
The report has put focus on the different types, size and scope of organizations followed by
interrelationship of various organizational functions that link to their business structure. By
carrying out analysis, further focus is paid on the positive and negative influence that impacts the
macro environment of a given business.
LO1:
P1: Explain different types and purposes of organization
Public Private Voluntary
Definition They involve the not-for-
profit government owned
organizations that provide
services solely for social
purposes.
They include the for-
profit organizations that
are both government
owned and by other
private bodies including
individuals and groups.
They include those bodies
that carry out social
activities undertaken
especially by some
specified not for profit
organizations which are
also nongovernmental in
nature.
Purpose The public sector
enterprises are the
government owned bodies
that seek to deliver public
goods and governmental,
services including
military, police, public
infrastructures, public
transits and such for the
betterment of the society.
They are an integral
part of the country’s
economic system which
is owned by private
individuals and groups
thereby running
operations for making
profit. They are also an
important source of
growth and
development and
generation of per capita
income for the country
thereby widening the
country’s GDP (Hillary,
2017).
Being comprised of
various organizations,
there sole purpose lie in
providing benefits and
enriching the society at
large without any return
for profit. They further
create social wealth and
help in the improvement
of the society.
Relation to the
chosen
organization
Taking the example of
Virgin money, which is
one of the leading UK
Taking the example of
TESCO which is a
British multinational
Taking the example of
Cancer Research UK,
light has been shed on
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challenger banks, focus
has been laid on the
approach that seek to offer
a good value to the
customers thereby
delivering a positive
contribution towards the
society.
retail company, has
been seeking to lay
emphasis on generating
a huge range of revenue
and net income, thereby
Seeking to obtain a
competitive advantage
of their own.
their social services
thereby conducting
research and campaigns
for preventing cancer
form the society. Being
voluntarily working, they
seek to spread awareness
amongst all for
eradicating the disease in
all levels.
Legal structures of Virgin money: being a leading UK challenger bank, they have focused on
the residential mortgages, savings and credit cards followed by a range of complementary
financial products including investments and insurance. This has not only helped them to
provide a positive contribution to the society but also build a positive relationship with their
partners thereby developing sustainable profits to their shareholders.
Legal structures of TESCO: the company has diversified their geographical and retail hold
thereby focusing on the key supermarket, hypermarkets, superstores and convenience shops
thereby selling a lot many products altogether. This has enabled them to open up a total of 6,553
stores thereby serving internally.
Legal structures of cancer Research UK: the company has met their purpose min continuing
their fight against the disease by taking the help of the nurses, doctors and social activists to
strengthen their infrastructure and progress. By holding an effective entrepreneurship, they have
further been able to support their internal structure and include 9 clinical trial units, 17
Experimental cancer Medicine Centers, 7 Graduate training programs and such.
P2: size and scope of a range of different types of organizations (M1 and M2)
Micro enterprises: Small enterprises: Medium and large
enterprises:
Size They include the
small businesses
sectors where the
employment level is
low along with a low
They are owned by
the independent
bodies and include a
small number of
workers seeking to
They include both
employees working as
voluntary
memberships and
mostly involve the
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investment capital. enhance their business
for the long run
thereby increasing
their sales volume.
multinational bodies
that have the
possibility of
increasing their
growth at a fast pace.
Scope The developing
countries constitute of
this type of enterprise
in a large number
where all the
necessities are
compelled by the
micro entrepreneurs.
This adds to the value
of their economy
thereby widening the
scope for better
income opportunities
and growth and
lowering of the
business costs. Cancer
Research UK is a
suitable example of
this type.
They are the private
bodies owned by sole
proprietors where they
work in partnership
and has the chance of
varying in their size
and revenue structure
accordingly (Bryman,
and Bell, 2015).
TESCO is a suitable
example of this type.
They include the
multinational
companies that work
as a part of the
government sector
thereby earning huge
revenues. The capital
that is earned is kept
aside for future
developmental
purposes thereby
seeking to develop the
internal aspects of the
company further.
Virgin money is a
suitable example of
this type.
Taking the example of the three typos of organizational structures and type, focus has been laid
on each of their size and scope. The micro sectors are not only large in their number but also
seek to work for enhancing the income and growth opportunities for the developing countries.
Cancer research being a voluntary based organization requires low investment costs but seeks to
work with a wider organizational goal of eradicating cancer globally thereby working in all areas
for social cause. Their biggest advantage lay in the freedom and fulfillment of employee and
customer needs which helps them to grow (Rostamkalaei. and Freel, 2016). The disadvantage
lies in the financial risks and presence of competition which poses as a big problem in their way
of development. The small enterprises include companies such as TESCO which are retail
sectors that seek to enhance their business and increase their sales volume thereby holding
partnerships with other companies or individuals to meet their purpose. They have the advantage
of getting a stronghold over management and control by the owners thereby adapting quickly to
meet customer needs. The disadvantage includes the limited daces to sources of finance (Charles
Jr et al. 2017). The medium and large enterprises include examples such as Virgin money which
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is a government bank based in UK and has been solely working as a not-for-profit company
thereby working their channels to help customers by providing loans and advances thereby
working for the benefit of all. Their advantage lie in their flexibility and close relationship with
customers while the weakness they possess is to maintain loyalty of the customers and
difficulties in terms of funding.
LO2
P3: Relationship between different organizational functions and their linkage
to organisational objectives and structure
With the increasing competition and risks, various departmental roles have come up within the
companies so as to help them maintain a suitable position of their own.
Marketing: they are one of the most integral parts of the business operations which help them to
develop a string relationship and interaction with the customers and the other businesses. They
are further responsible to deliver a string brand image of the given organization thereby carrying
out an active participation relating to various publicity active and customer interaction using
effective tools and methods (Storey, 2016).
Finance: They are other important department that controls the various expenditures of the
company followed by other legal obligations thereby managing the entire investment process of
the company so as to maintain their profits.
HR: they carry out an effective and strategic management of their internal work processes
hereby utilizing all the business resources efficiently. They further focus on carrying out an
effective recruitment process thereby hiring the best employees to add on to the company’s
benefit and help in increasing their productivity.
Operations: they seek to oversee the entire production process thereby bringing out a smooth
and efficient service so as to meet up to the expectations and needs of the customers duly.
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LO3:
P4: positive and negative impacts of macro environment upon the business
operations, supported (M3)
PESTEL Analysis
Political Being an internationally acclaimed bank, they
have been operating in UK, Australia South
Africa and such, under various laws,
regulations and policies the company therefore
needs to acknowledge these laws and adopt
them to operate successfully and effectively in
their financial system, they have also been
provided various protection strategies against
governmental restrictions and limitations to
safeguard their position.
Economic Virgin Money has experienced a massive
growth in terms of stability of the economic
factors followed by various foreign exchange
rates and stock markets on a global scale
(Crane and Matten, 2016). Their chairman has
therefore acclaimed making necessary
economic changes within their company to
widen their development and operations. This
has further helped them to cope up with the
2008 financial crisis.
Social In order to become successful in business, they
have made various attempts to satisfy their
customers. This has enabled them, to put focus
on the changing social trends with changing
customer needs.
Technological Virgin Money has made various technological
advancements thereby protecting themselves
form cyber attacks. Further they have taken
steps to protect the customer data thereby
implying various technical management teams
to improve their functionality.
Environmental They have set goals to reduce carbon emission
thereby developing procedures to improve their
technology and add onto a sustainable
engagement and supply chain collaboration.
Legal Being governed by various rules and
regulation, the company has laid emphasis on
adopting payment protection insurances
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thereby avoiding any future bad publicity from
maturing up. They have further adopted the
FCA act to handle their PPI claims thereby
developing their operations further (Besley,
2015).
LO4:
P5: Internal and external analysis of specific organisations in order to identify
strengths and weaknesses
Strengths Weaknesses Opportunities Threats
 They have
become a
master of
building brand
value
 They offer a
wide range of
customer
choices.
 They have
become a
monopolistic
company
where their
expansion has
now put it in a
critical
position
 They consist
of minimal
management
layers and a
weak board.
 They provide
old services
using new
modes which
further make
them
innovative and
increase in
their
opportunities
for further
growth
 They have
been able to
reduce their
operating costs
thereby
applying
effective
strategies.
 Presence of
global
competition
 Increase in
financial crime
P6: interrelation of strengths and weaknesses with external macro factors
(M4)
Using a TOWS matrix model, focus has been laid on the interrelationship between factors for
Virgin Money.
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Threats:
 Presence of a huge competition within the banking industry of UK due to presence of
other multinational companies such as HSBC.
 There has been an increased growth of pawn shops thereby wakening the loan growth
 There is a huge chance for failure ion investment transactions which affect the
company’s development and decision makings for meeting the future goals.
Opportunities:
 The company has been expanding their branches slowly towards the developing countries
such as South Africa.
 They have applied high end promotions to attract new customers and increase their
online banking users thereby meeting the set targets (Bendell, 2017).
Weaknesses
 The company still lags behind in terms of obtaining the most advanced technology which
leads to an unproductive set of workers and lack of online investment.
 They also possess poor interest rates which limit their possibilities of growth.
Strengths:
 They possess an effective and excellent management system within which helps them to
carry out effective decisions within.
 They constitute of a suitable reliability and transparency thereby developing a string
relationship with the clients (Rostamkalaei and Freel, 2016).
Conclusion
The report therefore infers by stating an understanding of the various business functions and
related environment with focus on Virgin Money in the UK context. Focus has been given on the
various types of organizations, their sizes and scopes and the way they seek to operate them.
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Further exploration has been made on the wide range of scope and size of the various business
types thereby analyzing the company’s micro and macro aspects effectively.
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Reference list
Bendell, J., 2017. Terms for endearment: Business, NGOs and sustainable development.
Routledge.
Besley, T., 2015. Law, regulation, and the business climate: The nature and influence of the
World Bank Doing Business project. Journal of Economic Perspectives, 29(3), pp.99-120.
Bryman, A. and Bell, E., 2015. Business research methods. Oxford University Press, UK.
Charles Jr, O.H., Schmidheiny, S. and Watts, P., 2017. Walking the talk: The business case for
sustainable development. Routledge.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Hillary, R. ed., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Rostamkalaei, A. and Freel, M., 2016. The cost of growth: small firms and the pricing of bank
loans. Small Business Economics, 46(2), pp.255-272.
Storey, D.J., 2016. Understanding the small business sector. Routledge.
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