Business Environment: Types, Functions, and Impact Analysis

This report provides a comprehensive analysis of the business environment, focusing on the types, purposes, and scopes of organizations, including public, private, and voluntary sectors. It examines Iceland Foods Ltd, NHS, and Cancer Research UK, detailing their missions, visions, objectives, legal structures, and stakeholders. The report explores the relationship between organizational functions, such as finance, production, and human resources, and how they link to business objectives and structure. Furthermore, it delves into the positive and negative impacts of the macro environment, utilizing PESTLE and SWOT analyses to identify strengths, weaknesses, and their interrelation with external factors. The analysis covers the significance of international business development and the strategic implications for each organization, offering insights into how they navigate the complexities of the business landscape.

Business and
Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purpose of organisations as public, private and voluntary.....................1
P2 Size and scope of different types of organisation..................................................................2
TASK 2............................................................................................................................................5
P3 Relationship between different organisational functions that link with objectives and
structure.......................................................................................................................................5
TASK 3............................................................................................................................................6
P4 Positive and negative impacts of macro environment upon business operations..................6
TASK 4............................................................................................................................................9
P5 Conduct internal and external analysis to identify strengths and weaknesses.......................9
P6 Explain strengths and weaknesses interrelate with external macro factors.........................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13
.......................................................................................................................................................14

INTRODUCTION
Business environment is made with two aspects including Business and Environment.
Both are important and essential for the growth and success of economic. Business refers as a
human activities like sales, extraction, production and sales of products that are executed to earn
maximum amount of money (Business environment, 2016). Further, environment is consider as a
part of surroundings. Therefore business environment is define as a set of conditions including
political, institutional, social, legal or economical that is not manageable and highly impacts on
the business functions. In this assignment chosen organisation is public, private and voluntary
for example Sainsbury, Iceland Foods Ltd and Cancer Research UK. All these business has their
own purpose, size and scope which are mentioned in this project. Relationship between
organisational functions and business structure and objectives are also determined. PESTLE and
SWOT analysis and their impacts on decision making which is also covered in this project. At
last interrelationship between internal and external factor of enterprise that also shown in this
study.
TASK 1
P1 Different types and purpose of organisations as public, private and voluntary
There are different types of organisation including public, private and voluntary. All
these are play vital role in providing better chances of job to the unemployed people.
Private Sector: These are type of business which is operating and running by its sole traders.
Main aim and purpose of lunching such company is to bring creative and innovative for whole
community as per the actual trend (Cassell and Blake, 2012). Such kind of organisation is
controlled by single person or group in partnership. In this chosen private company is Iceland
Foods Ltd, it is a retail industry which deals in groceries and frozen foods. It was founded in
1970 by Sir Malcolm Walker. Purpose of this business are determined as below:
 Main purpose of Iceland is to incraese their sales and revenues by rendering quality in its
products and services to the customers.
 Give friendly and healthy environment to their entire workforce. Major motive of private company is to gain trust of national and international clients.
Public Sector: It is another type of organisation which is completely controlled and managed by
legal authority of particulate country. Main motive of introducing these kind of entity is to work
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with the development and welfare of society (Cavalcante and et. al., 2011). Such business
support in improvement of economy by giving governing services and many other benefits to
society. In this selected public company is NHS, it was formed by Simon Stevens in 5July 1948
at Richmond house, 79 Whitehall, London, SWIA 2NS.Main motive and purpose of this
business are given below:
 Raise well-being as well as health of service seeker.
 Bring quality and creation in business activity or tending promoter department. Supply basic medical facilities to injured persons.
Voluntary Sector: Enterprise which comes under such sector are performing with the aim of
social development as well as welfare of economic. These business is managed and controlled by
regime of specified country as well as team voluntarily also (Cronan and et. al., 2011). Under
this selected organisation is Cancer Research UK, It was founded by Harpal Kumar in 4
February 2002. Focus of this enterprise is health policy and cancer research. Aim and motive of
this enterprise are given below:
 Main and foremost aim of this business is to work and perform in reducing poverty ratio
and maximising living standard of society or poor peoples. To provide effective and better services to the needy people as well as gain their trust.
Growth and development of the international business environment: It is important and
essential part in this above three types of organisation are play vital and effective role for
development of their business operations internationally. For achievement of this, company
provide effective quality in their services and products which help them to maintain strong
position at global level (Elliot, 2011). It is also beneficial for the to maximise their sales as well
as gain competitive edge within predetermined time period.
P2 Size and scope of different types of organisation
Three types of organisations such as Private, Public and Voluntary sector, all these are
play effective and essential role for the development of society and achievement of long term
goals and objectives. Example of such sector is Private: Iceland Foods Ltd, Public: Sainsbury's
and Voluntary: Cancer Research UK. Size, scope, mission, visions , objectives, legal structure
and stakeholders of those organisation are determined as below:
NHS:
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Size: NHS is a type of public sector organisation which renders health services in UK. There are
also different countries where business entity renders their quality and effective service such as
Scotland, Northern Ireland, England and many other countries in a systematic manner. In the
organisation approx 1.6 million workers are working with the motive of providing quality
services to service user. This business was formed in 5July 1948 by Simon Stevens at Richmond
house, 79 Whitehall, London,
Scope: NHS is a popular and well established organisation across the world with their
quality as well as quick services. They provides medical facilities to the injured person of
society. There are another effective services which are provided by the NHS such as dental,
optical and other. Main scope of business entity is explained as below:
 Administration of the fiscal services which are given for health services. Distribute required information regarding health and social care services to society.
Vision: Vision statement of the company is to provide good healthcare services to the needy
people of community.
Mission: Mission statement of the NHS is to provide quality as well as healthy services to the
patients or service seeker everyday.
BUSINESS OBJECTIVE: Main objective and aim of introducing these type of enterprise is to
supply services fore development and welfare of society.
STAKEHOLDER: In the business entity, there are different stakeholders are participated in the
development and growth of company (Kaufmann and et. al., 2011). Some stakeholders such as
customers, employees, government and many other that play essential role for accomplishing
goals with predetermined time period.
LEGAL STRUCTURE: Central government: It is a type of government of particular nation and it is feature of a
unitary state. Further structure of central governments that varies from various countries
as well as have to created autonomous regions. State government: These type of government provide their more contributions and
participation in functioning of state government. Local government: These are responsible for providing better support for the functions
and activities of company as per the management of public sector.
Iceland Foods Ltd:
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SIZE: Iceland Foods Ltd is a British supermarket chain which deals in retailing industry with
focus on the revenue of frozen foods considering prepared vegetables and meals. Such business
was founded in 1970 by the Sir Malcolm Walker at Deeside, Wales, United Kingdom. In the
company 23000 employees are recently working and having motive to attract large number of
customers by providing quality services and products to the customers at reasonable price.
SCOPE: Iceland Foods Ltd scope is very large due to its quality products and services as well
as reasonable price also. Business entity deals in different variety of products including Carrots,
Parsnips, Swede & Onion, Ice Cream & Lollies, Garlic Bread & Dough Balls, Party Desserts,
Frozen Fruit & Smoothies and many other products. All these are available at different places
and at affordable price (Lee and et. al., 2012).
VISION: To modify the grocery and retailing industry with an innovative and attractive business
model.
MISSION: Top and better quality at incredibly minimum prices guaranteed.
BUSINESS OBJECTIVE: Major aim and purpose of private sector is to increase trust of
national as well as and international customers by rendering quality in its grocery products and
services.
STAKEHOLDER: In the retailing industry, there are different number of stakeholders are work
including employees, clients, legal authority, suppliers and many other. All these have common
motive to maximise revenues and sales of organisation.
LEGAL STRUCTURE: Sole Traders – It is a type of this sector which is closely-held and authorised by single
person who is presenting enterprise as well he/she is accountable for entire activities and
functions of company. Franchisee – It is a kind of large chain of business stores who is serving variety in its
products and services to different peoples. Partnership – In this kind of organisation two or more than that concern for opening a
innovative business entity as well all the employees or partner have equivalent rights and
duties to increase reputation of the company at marketplace (López-Gamero and et. al.,
2011).
Cancer Research UK:
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SIZE: Cancer Research UK is a awareness charity and cancer research in the United
Kingdom. This business was established by Harpal Humar in 4 February 2002 at England, UK.
In the company approx 40,000 volunteers are work in 2015 with aim to maximise their revenues
and sales.
SCOPE: Company organise research program into the prevention, treatment and
diagnosis of the disease. Further research activities are accomplished in universities, hospitals
and institutes, across the United Kingdom, both by the charity's own workers as well as by its
grant-funded investigators. So that, it proof scope of the voluntary sector is limited.
VISION: “To save more lives by controlling, preventing and curing cancer.”
MISSION: “To bring forward the day when entire cancers are cured.”
BUSINESS OBJECTIVE: Main purpose of introducing such kind of business is to providing
better services for the welfare and growth of society (Onetti and et. al., 2012).
STAKEHOLDER: In Cancer Research UK Customers, Employees, Local Community,
Government, Suppliers Pressure Groups, Financier and many other. All these are play essential
role for the betterment of society.
TASK 2
P3 Relationship between different organisational functions that link with objectives and structure
In Iceland Foods Ltd there are different number of departments are work with having
common purpose to achieving long term objectives and goals. They sell frozen and non-frozen
items including prepared meals and vegetables, meat, dry and dairy products. Different
departments including human resource, Production & operational, finance and many other
departments that with linked with business objectives and structure are determined as below:
Finance Department: This type of function of the business play essential duty in ruining
its functions and operations in effective way (Owusuand and Habiyakare, 2011). Financial
manager of Iceland Foods Ltd has different roles to provide accurate amount of the capital to
other departments such as HRM and Production.
Production and operations department: It is another function and in which raw material
is transformed into final products. In this operations administrator follow different tools that
support in managing cosy of production. In this, operational manager of the Iceland Foods Ltd
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needed sufficient amount of the money which is useful for them to complete all activities in
given time period.
Human resource department: This department has different functions including hiring,
selecting and recruiting knowledgable candidates for accurate position. In this various activities
are included with such departments like employee compensation, performance appraisal, tanning
and development, wages and salary and many other. All these functions are highly essential for
the manager to motivate their entire workforce. So that they are capable and bring innovation in
the production process.
Organisational Structure: It is classified into different parts which are mainly related with the
business functions are explained as below:
Divisional: In this Structure functions of the departments are classified which assist in
bringing flexibility in business operations. Product line or geography of organisation is helped by
required resources and functions that are considered in individual section. This structure mainly
related with production and operational department and having motive to achieve long term
goals and targets of enterprise.
Functional: According to specialized locations, functions of organisation are classified
into certain parts. Such kind of structure is mainly applied in enterprise as it support in delivering
effectiveness in business operations and activities because shared quality are classified by such
function.
Matrix: These type of structure is based on large number of person. In Iceland Foods Ltd
matrix structured is followed as it is inbuilt versatile that creates it essential for enterprise (Palo
and TähtinenSaleem, 2017).
TASK 3
P4 Positive and negative impacts of macro environment upon business operations
Iceland Foods Ltd is a well established British Multinational organisation in United
Kingdom. Macro environment is identify as a PESTLE Analysis that impacted on the activities
and performance of organisation. It will also effects on the decision-making power of company.
PESTLE Analysis of the Iceland Foods Ltd and its negative and positive impacts are explained
as below:
PESTLE ANALYSIS DISCRIPTIONS POSITIVE IMPCATS NEGATIVE
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IMPCATS
POLITICAL This type factor
consist trade
restrictions, labour
law, political stability,
trade policy, tariffs
and many other. Thus
all these are made as
well as transformed by
legal authority and
influence on business
operations either
negatively as well as
positively (Teece.,
2012).
Rules and regulations
of the particular
country is good for the
business to follow all
these and maintain
their position at
internationally.
In global marketplace,
higher cost of
structure that becomes
disfavour for business
due to which it go
through financial loss
of market share when
they incoming new
market.
ECONOMIC Foreign exchange
rates, economic
growth pattern,
inflation rate and
interest rates etc. all
these are the economic
variables that are
enclosed in such force.
These components are
determinants of
economic
performance.
During financial crisis,
Iceland Foods Ltd
focuses on better
satisfaction of
consumer by rendering
them better quality in
its products and
services. It supports
them in maximising
confidence level of
clients.
Decreasing prices of
grocery products that
extremely influenced
on the performance
and activity of
company.
SOCIAL It consists cultural
aspects, age
distribution, buying
In modern premise
eating healthy and
effective product is the
Frequent variations in
customers likes and
dislikes that creates is
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behaviour of
consumers and many
other that impacts on
company as well as its
marketing strategies
also.
basic preference of
clients, Iceland Foods
Ltd have present
innovative range of
their organic products.
difficulty for
enterprise to modify
their product line in
constant manner
(Welter and
Smallbone, 2011).
TECHNOLOGICAL Technology is more
important and valuable
factor for the company
to save their cost as
well as time also. In
this Iceland Foods Ltd
use different tools to
introduce their
products in
marketplace including
social media and many
other (Welter and
Smallbone, 2011).
Important to easily
attract large number of
clients and maximise
their market share
also.
It highly effects on the
employees
performance and
productivity of
company.
LEGAL It covers entire
legislation that is
made by government
of nation. Non-
compliance of those
impacts on business
functioning and
working in negative
way.
Application of certain
legislation like health
and safety act,
environmental,
consumer rights, anti
discrimination and
many other that
influences on business
functioning.
Applying effective
decision of United
Kingdom to exit
European Union leads
the business to face
different legal
problems through
which company can
loose its entrée to
common marketplace.
ENVIRONMENT In actual scenario, Formation of “Green Non compliance of
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society as well as
business organisation
are related regarding
environment. In this
respects, Iceland
Foods Ltd implement
different strategies in
order to advertise
environmental
consciousness among
public.
Policy” that supports
company in comely
carbon neutral and
helps in sustainable
beginning, zero waste
to landfill, ethical
trading, promoting
business.
situation policy
outcomes in bad
picture of enterprise in
eyes of group of
society (Cassell and
Blake, 2012).
TASK 4
P5 Conduct internal and external analysis to identify strengths and weaknesses
Internal factor includes Strength and Weaknesses and external factor consist threats and
opportunities. All these are influence on the decision making and performance of company. In
this manager of the Iceland Foods Ltd make an effective decision to expand their business
operations and functions at different level (Cavalcante and et. al., 2011). SWOT Analysis of the
company are explained as below:
Strengths Weakness
 One of the biggest and supermarket
chain in United Kingdom.
 Has a workers strength of over 23000
people.
 Excellent advertising and branding.
 Rising product prices over the world
have effected on Iceland Foods Ltd
selling at maximum prices.
 Stiff competitions within each and
every section of the retail industry.
Opportunities Threats
 Expanding their business operations
and success into growing economics
such as Asia, Africa etc.
 Maximising internationalization,
presents an opportunities as well as
challenge to Iceland Foods Ltd.
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 Iceland Foods Ltd can enter the
marketplace of emerging business
through partnership to investigate it in
new markets.
 Has to ever source the better quality
and financial viable goods from globe
over vis a vis its challengers.
Thus, SWOT Analysis of the company is extremely influenced on the business operations
and decision making ability of manager (Cronan and et. al., 2011). Thus, these factor is effected
on the profitability and productivity of the organisation also.
P6 Explain strengths and weaknesses interrelate with external macro factors
Strength and weakness of an organisation is mainly related with macro factors. So
Iceland Foods Ltd manager needs to identify such interrelation in order to grab opportunities as
well as gaining competitive edge in market (Elliot, 2011). Interrelationship between internal and
external factor of organisation are explained as below:
PEST ANALYSIS DISCRIPTION STRENGTHS WEAKNESSES
POLITICAL All rules and
regulations are
required to apply by
organisation so that
impressive group can
be formed and alter to
execute operations of
business in an
effective manner.
By following political
factors of particular
nation, Iceland Foods
Ltd is capable to
operate its operations
and functions in
smooth manner.
Non-compliance or
disagreement of
political variables that
highly hampers on the
functioning of Iceland
Foods Ltd as
legislation of each and
every nations is
different.
ECONOMIC Business functioning
and working is
extremely effected by
economic factors
including interest
rates, inflation,
deflation, exchange
If economy of
particular nation is
powerful then it help
in its improvement and
growth. It also aid in
yielding maximum
Product demand and
supply in marketplace
is extremely effected
during rising prices as
buying ability of
clients becomes low.
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