Business Environment Report: Organizational Analysis and Factors

This report provides a comprehensive analysis of the business environment, focusing on three types of organizations: private, public, and voluntary. The report begins by defining the business environment and then delves into the specifics of each organizational type, using the Arcadia Group as a case study for private organizations. It explores the purpose, size, scope, and growth of these organizations in the international business landscape. The report then examines the relationship between organizational functions, such as finance, human resources, customer service, and technology, and their links to business objectives. Furthermore, it investigates the positive and negative impacts of macro-environmental factors, utilizing PESTEL analysis to assess the external environment. Finally, the report conducts an internal and external analysis using SWOT analysis to identify the strengths, weaknesses, opportunities, and threats of a firm and explores the interrelation of strengths and weaknesses with macro environmental factors. The report concludes with a summary of findings and references.

BUSINESS AND BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Types & purpose of different type of organisations and their growth in international
business environment...................................................................................................................1
P2 Size and scope of different types of organisation...................................................................3
TASK 2............................................................................................................................................5
P3 Relationship between organisational functions and their link with business objectives........5
TASK 3............................................................................................................................................7
P4 Positive and negative impact of macro environmental factors...............................................7
TASK 4............................................................................................................................................9
P5 Internal and External analysis of strengths and weakness of firm with the help of Swot
analysis........................................................................................................................................9
P6 Interrelation of strength and weakness with macro environmental factors..........................11
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Business environment refers to internal and external organisation situations. This report
highlights about business environment of three types of organisation i.e. private, public and
voluntary organisation, where chosen private firm is Arcadia Group which is UK based
multinational retailer. On the other hand, this report also pays attention towards the
interrelationship between the functional areas of private organisation. Further, this report
describes about the PESTEL and SWOT analysis which demonstrate the internal and external
performance of company.
TASK 1
P1 Types & purpose of different type of organisations and their growth in international business
environment
PRIVATE ORGANISATION
Private organisations are profit making organisation operated by individuals and not by
government. These organisations cover large portion of a country’s economy because, their main
aim is making money (Schaltegger and Wagner, 2017). Private sector firm generate employment
in the economy because, it employs more workers than the public sector companies. These
companies create competitive environment in the economy.
Arcadia Group Ltd. is a private multinational retailer which offers clothes, accessories
and shoes. It is a UK based company has it headquarter in London. The company owns many
popular brands like Top-shop, miss Selfridge, Dorothy Perkins, Burton & BHS. The main
purpose of arcadia group is making profit.
Britain exit from European union effect financials of the Arcadia group, Companies
profits are declined because after that company cannot trade with British companies but
somehow company manages it by establishing its business in other countries across the world.
Arcadia group is growing internationally by establishing more stores outside UK. As of
now the company established 1170 stores in 36 counties outside the UK and the company also
increased volume of its online business by shipping to 107 countries across the world.
Companies’ profits are showing an increasing trend across the market.
PUBLIC ORGANISATION
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Public organisations are owned & controlled by government and it provides goods &
government services (Infrastructure, healthcare, education & public transit) to the public. The
purpose of public organisation is to provide services for the welfare of the whole society rather
than the person who uses it. Public organisation employs workers with help of state & federal
government. Funding of public organisation done through direct or indirect taxes.
National Health Service is a public organisation which provides health care services to
four constituent countries of UK that are England, Scotland, Wales & Northern Ireland. Purpose
of NHS is to provide all type of health care services to the ordinary residents of UK at free of
cost.
The company provides services in three groups general practitioner & dental, hospital &
specialist and local health authority services. Funding for NHS is come through taxes, insurance
contribution and fee received from patients.
Emergence of Brexit causes problems for the medical organisations & seems bad for the
country’s health, medical organisations are focusing on managing the problems caused by the
Brexit and they are diverting resources from patient's care. Professional staff cannot migrate to
UK due to exit of British from European union that creates shortages of staff (doctors & nurses).
VOLUNTARY ORGANISATION
Voluntary organisations are not operated by government they are non-government
organisation (NGO's) which works independently. This organisation provides social services like
educational, health care, social, human rights, environmental services and many other services
matches the organisations objective (Drew and Grant, 2018). It offers services to poor, old-aged
and sick people of society. Voluntary organisation includes clubs & association that provides
services and benefits to its members.
Oxfam International is a voluntary organisation which focuses on reducing poverty and disaster
relief. This organisation includes 20 charitable organisations. Oxfam has its stores all around the
worlds which offers many fair-change and donated objects like books, garbs, toys and meals, etc.
In recent years Oxfam has created more equal society by helping regular workers and
producers who are producing at a small scale, instead of the wealthy producers. They have
followed certain taxation policies for reducing of tax and inequalities which is being faced by
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small-scale producers. International growth of Oxfam was also influenced by Brexit for a
particular time span because of bad exchange situation. For example, the funds released for
programmes arrived last moment which hampered the quality of charity events.
P2 Size and scope of different types of organisation
PRIVATE ORGANISATION:
 Background: Arcadia is the UK's biggest privately-owned fashion retailer operates the
fashion shops and outlets within United Kingdom and internationally.
 Products and services: It deal in three distinguished products i.e. clothing, accessories,
and shoes under the excessive avenue brands: Burton, Dorothy Perkins, Evans, Miss
Selfridge, Topshop, Topman and Wallis.
 Size: the company has more than 2500 stores operating in more than 35 markets.
 Scope: Its presence is felt everywhere around the globe in around 680 worldwide
locations with different transactional websites.
 Vision: Avail the proper products, on the right time, and at the right price, by
accomplishing buyer’s requirement.
 Mission: Arcadia University presents a distinctively worldwide, integrative, and private
learning experience for students.
 Business objectives: The company want to maximize its profits through achieving
marketplace dominance (Bull and et.al., 2016).
 Organisational and legal structures: Organisational structure of Arcadia group is
hierarchical which is combination of divisional and functional areas. Further, the firm has
different legal structuring for its business units. It follows certain policies for their
products which are part of its legal structuring like, Feathers must not be tweak from
animals, no merchandise are to be sourced from endangered species, etc. For example,
the firm has determined relationship with suppliers and factories in accordance with
Local Minimum Age Law which prevents child labour. Further, the cosmetics ingredients
of Arcadia are not tested on animals.
 Stakeholders: It encompasses of employees, suppliers, vendors and they satisfy them by
providing adequate returns on their investment.
PUBLIC ORGANISATION
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 Background: NHS was released in Great Britain in 1948 as a public healthcare provider
the under-government regulations.
 Products and services: It cover pharmacy, dentist along with antenatal screening,
recurring screenings, transplants, and emergency treatment
 Size: This presently operates at 64.6 million humans in the UK and 54.3 million people in
England alone.
 Scope: The NHS in UK caters to a population of 54.3 million and providing jobs to
around 1.2 million people. In recent years the approx. budget of NHS was around £116.4
billion.
 Vision: Providing Excellent health care facilities via quality service and products
(National Health Service, 2018).
 Mission: “To supply effective health care services in accordance with standards and
guidelines that are convenient and affordable for customers.
 Business objective: ‘To help the Government in meeting the health care facilities via
proper development and management of services.
 Organisational or legal structure: They follow certain principle based on Human Rights
Act 1998 and Equality Act 2010 which focuses on equal and fair treatment to patients.
The legal structure of NHS is based on clinical commissioning groups according to which
consultants, care providers are responsible for 60 % of budget of NHS. However,
organisational structure of NHS comprises functional units in flat and hierarchical order.
 Stakeholders: The major stakeholders are patients, employers, insurance companies,
sponsors, pharmaceutical companies and government and their motive is to provide
proper health care facilities.
VOLUNTARY ORGANISATION
 Background: OXFAM is a non-profit organisation founded in 1942 under Oxfam
international which focuses on eradication of poverty worldwide.
 Products and services: Oxfam have stores all around the world, which sell many fair-
change and donated objects like books, garbs, toys and, meals etc.
 Size: It operates with 20 charitable organisations that operates independently.
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 Scope: It operates internationally for providing essential services to the unfortunate
people so that they can live a sustainable life.
 Vision: Their vision is a simply a world without poverty.
 Mission: they address the reasons of poverty and associated injustice and provide
solutions for the same.
 Business objective: Their motive is providing solutions for eradications of poverty
(Ginzberg, 2017).
 Organisational or legal structure: The company follow certain rights for providing justice
to people all over the world like, the right to life and security, right to basic services, etc.
The legal structure of Oxfam is different according to its information policy like
corporate governance is based on CSR standards like trading, communication,
campaigning policy and fundraising. Some of the CSR polices comprise Anti- slavery
policy, Gender equality, etc. It follows the flat structure that works globally for helping
the people who trapped under poverty.
 Stakeholders: It includes community groups, general public, international companies and
government that helps in decreasing of poverty from the countries across the globe. The
focus of firm is on meeting interest of stakeholders in order to fulfil individual needs.
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TASK 2
P3 Relationship between organisational functions and their link with business objectives
Figure 1: Organisational Structure of NHS
(Source: Organisational Structure, 2018)
Arcadia Group follows combination of functional and division structure as it promotes clarity
over functional area of organisation. Some core functions of firm are discussed below: Finance: Finance department of Arcadia Group focuses on maximising profits of the
company by minimising its manufacturing cost. This function helps the company in
evaluating budget, forecasting, trading report and manage accounts & payroll. Thus, the
finance department helps the company in achieving profitability and increasing the sales
volume. Human Resource: Arcadia Group's human resource team manages various needs of the
company’s employee like staffing needs, compensations, benefits, law compliance &
performance appraisal. It promotes brands using social media sites at careers fairs, the
Fashion Retail Academy or flying the flag (Group functions, 2018). Thus, the human
resource department helps Arcadia in selecting potential employees and encouraging
them to work towards the objectives of an organisation.
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 Customer Services: Companies success depends on its customers so; Arcadia's customer
care team focuses on fulfilment of the requirements of its customer. It collects feedback
from the customers and make changes accordingly. Thus, the customer support team of
Arcadia helps the company in retaining the loyalty of customers by fulfilling the needs
and wants customers.
 Arcadia Technology: This team provides IT support to the group and helps the company
in making projects so that the company can grow in the future. Company serve through
40 websites in 117 countries across the world. Thus, the IT department helps the
company in updating their customers on regular basis through advanced technology like
e-mails, chatbots etc.
Figure 1: Organisational chart of Arcadia Group
(Source: The Organization Chart and Reporting Structure, 2019)
Inter-relationship between functions of organisation Finance & Human Resource Function: Finance team of the Arcadia Group are related to
human resource team because it helps in deciding the pay structure of employees and it
also set budget for the human resource department. Finance team provide funding to HR
team and all the other function department. Thus, finance and human resource department
helps Arcadia in recruiting the needed personnels based on the budget of company. Marketing & Finance Function: Finance team of a Group provides funding to the
marketing team for advertising and promotion and in turn marketing team maximises
profits by promoting companies’ products & services (Ramanadham, 2019). Thus, the
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marketing and finance department accomplish the goal of Arcadia by conducting
attractive advertising activities considering the budget of company. Customer Services & Marketing: As Arcadia Group operates in many countries across the
world, Marketing team develops its advertising according to the choice & culture of the
customers of a particular area and that all the information regarding to the customers are
given by customer care team to the marketing team. Thus, the customer support team
and marketing helps the company in undertaking the marketing activities according the
needs and wants of different generations of customers.
 Technology & Marketing: Arcadia Group promote their products through social media
and online websites so information technology team helps marketing team in promoting
the products. Thus, the IT department and marketing department accomplishes the
objective of company by undertaking attractive promoting activities with the help of
social media platform like Instagrame, Facebook etc.
INTERRELATIONSHIP BETWEEN FUNCTIONAL AREA
The functional units of organisational structure are segregated according to geographical
locational and are further divided according to key areas which has different benefits and
limitations.
ADVANTAGES Finance department according
to divisional structure is liable
to coordinate with all
functional units of one
geographical location to
ensure smooth flow of funds
which assist in easy handling
and management of monetary
benefits.
For marketing in divisional
structure, it is necessary to
focus on production of Arcadia
uses technology through which
they increase their sales. The
connection of functional units
in divisional structure supports
coordination and cooperation
DISADVANTAGES Connect with every
department in divisional
structure is quite complex and
Lack of training initiative by
HR team to all department
because of division.
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rigid which can restrict flow
of business information.
TASK 3
P4 Positive and negative impact of macro environmental factors
Figure 2: Pestle Analysis
(Source: Talib and et.al., 2016)
 Political factor: These are all about how and to what degree a government intervenes in
the economy. This can include government policy, political stability or instability in
overseas market, tax policy, foreign trade policy, labour laws, etc(Drew,and Grant,
2018.). For example, decrease in government taxes was beneficial for Arcadia because
now the company has to pay less money in form of taxes. Further, National minimum
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wages increased which created negative aspect on the company because now the firm has
to pay more wages which will lead to increase in the cost of the company.
 Economic factor: These factors have a significant on how an organisation does business
and how profitable they are. Economic factors include economic growth, interest rates,
exchange rates, inflation, disposable income of consumer and businesses. The Consumer
Price Index (CPI) are the inflation rates which have decreased it means now the consumer
will buy more. The exchange rate has devalued which means that now the consumers
would be paying more for the same product in different country
 Social factor: Also known as socio- cultural factor, are the areas that involve the shared
belief and attitudes of the population. These factors include population growth, age
distribution, career attitudes, etc(Offenheiser,and Holcombe,2013). These factors are of
particular interest as they have a direct effect on how marketers understand customers
and what drives them. For improving social side of business is using waste material to
create new products. The company also fulfils its part regarding the corporate social
responsibility. The company has reduced the Co2 emission by 8%.
 Technological factor: Technological landscape changes and how this impacts the way
we market and products. Technological factors affect marketing and the management.
Due to technological advancement clearer information is produced and passed on
(Ginzberg, 2017). Online stores like Youth fashion has boosted online business on mobile
applications. Wi-fi access in- store makes it easier for consumer to find products if they
are not found in store. Customer service in- store and online has improved through the
improvement in technology
 Environmental factor: These factors have become important due to the increasing
scarcity of raw material, pollution targets, doing business as an ethical and sustainable
company, carbon footprint targets set by government (Cornforth, 2015). Arcadia fashion
have a very clear and visual environmental section on their website. They do not use
sweat shops and child labour. They use policy that feathers should not be plucked from
live animals.
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