Business Environment Analysis: Organisation Types and Functions

This report provides a detailed analysis of the business environment, focusing on different types of organizations (private, public, and voluntary) and their legal structures. It examines the size, scope, and objectives of companies such as JCB, BBC, and Cancer Research UK, and their stakeholders. The report explores the interrelationship between various organizational functions, including marketing and sales, operations and human resources, and IT and finance, highlighting how these departments work together to achieve common goals. Furthermore, the impact of the macro environment on business operations is assessed, along with an internal analysis using SWOT to identify strengths, weaknesses, opportunities, and threats. The report also analyzes the interrelation between internal and external factors and critically evaluates how both macro and micro factors influence decision-making within these organizations. The report emphasizes the importance of understanding the business environment for organizational success and offers insights into the complexities of different types of businesses.

Business
and
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1 ...........................................................................................................................................3
P1 : Different types, purpose and legal structures of organisation.............................................3
P2 : Size and Scope of this types of organisation.......................................................................5
M1 : Analysis of Size, structure and scope of different organisation.........................................7
TASK2.............................................................................................................................................7
P3 : Relationship between different organisational function......................................................7
M2 : Advantages and disadvantages of interrelationship between organisational functions....10
D1 : Critical analysis of complexities of different type of business.........................................10
TASK 3 .........................................................................................................................................10
P4 & M3 : Positive and Negative impact of macro environment on business operations........10
TASK 4 .........................................................................................................................................11
P5 : Internal Analysis of organisation to identify strengths and weaknesses...........................11
M4 : Analysis of SWOT and their impact on decision making ...............................................13
P6 : Interrelation between strengths and weaknesses with external factors..............................13
D2 : Critical evaluation of both macro and micro factors on decision making........................14
CONCLUSION..............................................................................................................................14
REFERENCES................................................................................................................................1

INTRODUCTION
Business is an activity that helps in exchanging the goods and services for a value by
which the organisations tends to achieve their goals of profitability. On the basis of the objective
and motive of organisation, they are categories into different classes such as private whose
motive is to earn profit, public and voluntary whose motive is social welfare. The operations of
all the organisation are affected by the environment in which they operate which can be internal
or external, analysis of which is important to identify the opportunities and threats in relation to
the strengths and weaknesses of the organisation. In this report two companies are taken in
consideration and their vision, mission, size, scope, objectives are analysed to determine their
impact on organisation. Also influences of various factors, be that within the organisation or
from outside on the organisation. Impact and influence of relationship between different
functions of the organisation are also considered as activities of all the departments are aligned
with each other to achieve a common organisational goal.
TASK 1
P1 : Different types, purpose and legal structures of organisation
Organisations are classified into different categories on the basis their motives which can
be to earn profits, social welfare or even both, accordingly their scope and purposes are defined.
The different types of organisations are :
Private Organisation : These companies are generally owned by the private entities
which can be a person, partnership, association etc. that operates for profit. The funds are
arranged and managed by them from their personal sources (Raziq and Maulabakhsh, 2015).
They are regulated by the laws imposed which may vary country to country. For e.g. JCB is a
private company which operates for profit.
Purpose : The main purpose of the Private organisation is to get profit, create value for
the company by increasing the market share and customer base. Also their aim is to create
monopoly by taking competitive advantage through their strategies.
Legal Structure of Private Organisation : Sole Proprietorship : It is a business set up which is owned and controlled by a single
person. They are personally held liable for all losses and liabilities, but they do not have

to share profits with others. The compliance of laws and regulations in sole proprietorship
are minimum (Aithal, 2016). Partnerships : These are the businesses which are owned and managed by one or more
partners. The mutually decide profit and loss sharing ratios and other terms which are
specified in the partnership deed but if such deed is not prepared then they are distributed
and governed as per the laws which is applicable.
 Limited Companies : They are separate legal entities then the who owns and manages the
company. In limited companies the capital is procured by issuing the shares to the people
who then have limited limited to the extend of their share. Limited companies have to
face the most regulations and compliances in order to protect the interest of the public
who has invested.
Public organisation : Public companies are those companies who are owned and run by
the government which is why their main aim is not to earn profit but social welfare. For these
organisation are the funds are provided by the government which is out of taxes collected from
public. They offers goods and services to improve the standard of living and to bring equality in
the society among different classes which they do it by outsourcing them to private enterprises
(Bah and Fang, 2015). For e.g. BBC is a public organisation which is funded and managed by
the government.
Purpose : The main purpose is social welfare to uplift the society and bring equality
among all.
Legal Structure of Public Organisation : Central : It is an apex body which control and regulates the entire economy by providing
the authority to different departments which work for welfare of society. They also seeks
profits which they can further use for welfare. State : They are responsible for a particular zone or territory, for which authority has been
granted to them. On the basis of which they monitors and regulate various departments
that fall under their supervision.
 Local : These are those municipal communities which manages a particular locality. They
are responsible for their development which makes the life of the people in the locality
simpler and comfortable.

Voluntary Organisation : These are those organisation which are incorporated for the
welfare and to provide aid to any specific issue. Such organisation are joined by the people
voluntarily. The services can be provided to any individual, a group or any country (Erasmus,
Strydom and Rudansky-Kloppers, 2016). For e.g., Cancer Research UK, is a voluntary
organisation.
Purpose : The main purpose is to provide assistance and aid to meet up with the issues.
They are not-for-profit organisations which work for the welfare of the people.
Legal structure of Voluntary organisation : Trust : These organisation manages property, land holdings and utilises the funds so
received for the particular purposes.
 Unincorporated Association : In these organisation people are voluntarily engaged for a
short span of time to meet up a particular issue.
Growth of International business environment :
International business environment is competitive because of rapid changes taking place
in the technology , taste and preferences etc. Also easy and increased mobility is the reason for
growth. Because of availability of labour, funds, liberal laws and many other reasons business at
international level is preferable (Fleisher and Bensoussan, 2015).
P2 : Size and Scope of this types of organisation
J.C. Bamford Excavators Limited : It is generally known as JCB which is one of the
largest multinational company who is engaged in manufacturing of a wide variety of machines
for construction, agriculture, waste management, demolition equipments. They operates widely
to almost 150 countries while factories in 22 countries (J C Bamford Excavators Ltd., 2019).
British Broadcasting Company : BBC is a public company which is registered under
Royal charter and it is one of the oldest broadcasting company. It is funded by the annual licence
fee which is paid by the people of the UK. The intend of programs that they are broadcast is to
create awareness about what is happening globally. It educates the people, entertain them
through news, sports, entertainment channels etc.

Cancer Research UK : Cancer research is an organisation which works for cancer. They
carry out significant research which helps the doctors to give treatment to the people. They aim
to cure cancer completely.
Compan
y
Vision Mission Size Scope Stakeholders
JCB The vision is
to make a
preferable
brand by
providing
unique value
to the
customers.
The mission is
to develop the
company by
providing
innovative,
strong and high
performer
products.
Their products
are sold in 150
countries. Their
revenue is
£3.35 in the
year 2018
whereas the
number of
employees is
approx. 15000.
They have been
operating for
construction,
agriculture,
waste
management
which are
focussed sectors
of the economy.
It is a family
owned business
which is run
and managed by
them.
BBC The vision of
the company
is to be
innovative and
creative which
will create an
understanding
with their
customers.
The mission is
to provide
authentic
information as
they are related
to surroundings
which educate
them.
BBC is
operating in
almost every
country where
more than
20000 people
are working
which makes it
a very large
company.
The scope that
they have is to
add on those
channels and
programs that
can attract more
youth (Sodeyfi,
2016).
They have so
many
stakeholders
which are both
internal and
external such as
media partners,
customers etc.
Cancer
Research
UK
Their vision is
to cure the
cancer issue
completely.
Their mission is
to conduct time
to time research
to find out
various type of
They have 100
members in
their charity
group who
helps them to
They want to
increase the
extend to which
they are
catering today
CRUK is
committed to all
their
stakeholders
i.e., volunteers,

cancers and
cures to
overcome the
issue.
operate and take
necessary
decisions.
so that they can
help more
people.
beneficiaries
etc. by
providing them
a wide range of
activities.
M1 : Analysis of Size, structure and scope of different organisation
Every business tends to increase their performance so that they can easily achieve the
organisational objectives. In this size, scope and structure of the organisation plays a crucial role.
As BBC is operating in different countries so they have to meet up the require of all such as they
have to introduce website, new channels and program so that they can attract the youth in such
countries where youth is in large number. In case of JCB, the size may affect their business as
they have been operation in almost 150 companies because coordination with all may become an
issue.
TASK2
P3 : Relationship between different organisational function
In every business, different activities are performed by different departments which has
to be aligned which can save the time, efforts and resources of the organisation. Also
departments are dependent upon one another either for assistance or for resources (Otache and
Mahmood, 2015). The interrelation between functions in context of JCB is :
 Marketing and sales : Both the department are interrelated to each other as marketing
department will create plan and on the basis of which sales department will make their
sales strategies whereas sales department will give the feedbacks of the customers to
the marketing department on the basis of which they will make plan and strategies of
advertising etc.
 Operations and Human resource : Operations and Human resource are dependent
upon each other as on the basis of demand of operations departments human resource
department will supply them the labour.

 IT and Finance : Finance department will arrange the funds for IT department as they
require the funds most because of updating the technology. JCB has to update their
process by adapting new technology for which finance department will procure and
provide them the funds (Hillary, 2017).
Organisational objectives are common goal for all the department, which can be achieved only
by working simultaneously with coordination. In JCB, the sales department will take feedback
from the customers on the basis of which marketing department will formulate strategies of
promotion etc. and on the basis of which they will ask the operations department to produce the
machineries. Similarly, the human resource department will provide workforce to all the
departments of JCB.
Organisational structure : It is a system that defines how the activities in the organisation will be
done. It determines the flow of information, authority and responsibility, roles and duties etc.
Different organisation follows different structures which can be flat, hierarchical, matrix,
divisional etc.
The structure that is followed by the JCB is functional structure. It is a structure which says that
organisation is divided into smaller groups which has to perform specific function. Every
function has a manager who manages them (Makarova and Polyanin, 2015).

Illu
stration 1: Organisation Chart of JCB International
(Source : Organisation Chart of JCB International, 2013)

M2 : Advantages and disadvantages of interrelationship between organisational functions
Interrelation between organisational function helps an organisation in achieving their
goals as all the departments will work simultaneously with integration which will save the
resources and the efforts of the organisation. In JCB, all the departments give necessary
information to other department which will facilitate them in their operations such as sales
department provides customers feedback to the marketing department on the basis of which they
prepare marketing plan. But it may create chaos when their exist the communication gap among
the departments.
D1 : Critical analysis of complexities of different type of business
Every business faces some complexities in regards to their structure and interrelation but
it even may offer opportunities which vary in different type of organisation. Various
complexities which are faced by the JCB in their structure is of communication gap, misuse of
the authority, issues with supply chains etc. All these have direct influence on the business as
they affect the operations of JCB. Also interrelation has impact on business which save time,
efforts and resources but due to competitiveness and communication gap among departments it
affects the business of JCB.
TASK 3
P4 & M3 : Positive and Negative impact of macro environment on business operations
Macro environment are those external factors which have both positive and negative
impact but the organisation have no control over it. To analyse the impact is crucial for the
organisation so that they can grab the opportunity if exist by minimising the impact of any threat
(Huang-Horowitz, 2015).
For analysis of macro environment PESTLE model is used :
Political Political factors are related with the intervention of the government in the
business. The government of UK is so focussed towards waste management,
power stations etc. which will bring sustainability in the country. Due to which
the demand for equipments of waste management, demolition will increase. But
public expenditure is reducing on infrastructure due to which the demand for
construction equipments of JCB may decrease (Prajogo, 2016).
Economical Economical factors includes interest rate, unemployment rate etc. Financial

crises has slowed down the market growth due to which investment and
construction work is also slowed down in UK which affected the demand for
their products. But it is expected to grow in future, to grab the opportunity in
future they can make plans of production from now.
Social Social factors are related with the taste and preferences, demographical factors
etc. Due to increasing rate of urbanisation which is expected to grow more, will
boost the construction industry. This will increase the demand for JCB
products. As they provides employment to large number of people this make
them to meet up with the regulations.
Technological This is most important factors that JCB has to consider as they manufacture
heavy equipments for which technology is must. As companies in UK are more
conscious for the safety of the labour and efficiency of the machineries, they
have to adapt new technology in order to improve the efficiency and safety of
their products even through customisation. But this leads to huge cost and
investment as they manufacture heavy equipments (Kolk, 2016).
Legal As the industry to which JCB provides goods to employees a large number of
people which is why they have to face so many compliances regarding safety.
JCB is also affected by this as they have to take more measures to keep their
products more safe. This increases the cost for research to ensure safety.
Ecological Due to construction, environment is affected much as the machineries emit
carbon, creates waste which increases pollution. This make JCB responsible to
manufacture such machineries which emit lesser carbon and creates waste, it
will increase the demand for their products (Pestle Analysis of Construction
Industry, 2019).
TASK 4
P5 : Internal Analysis of organisation to identify strengths and weaknesses
Internal analysis helps an organisation to analyse their competencies, cost, viability in the
competitiveness in relation the opportunities and threats that exist in the industry or in the market

(Khan and Quaddus, 2015). Such analysis is important for all types of organisation, which can be
done by SWOT analysis for both JCB and BBC.
SWOT for JCB :
Strengths Weaknesses
 They offers a wide range of products
for construction, agriculture, waste
management etc.
 Existence in many territorial division
due to which their market share is
large.
 Their channel with dealer is strong and
wide.
 High dependency on European market
and crises in which has affected the
operations.
 The cost of maintenance is high as the
parts of the machines are so costly.
 The diversification in the same business
is lesser which shrinks their share.
Opportunities Threats
 They have opportunity to expand their
factories as opportunity is rising in
government projects.
 Growth of residential sector in Asia.
 Expansion of warehouses will help
them to increase their customer base.
 They are dependent upon the growth in
other industry such for their
construction equipments they are
dependent upon construction industry.
 Competition is high which affects their
operations.
SWOT for BBC :
Strengths Weaknesses
 One of the oldest which is why they
have strong brand image
 Frequent updates to provide their
viewers new and updated things.
 Focused marketing campaign which
keep them in win win situation.
 Cost of operations are high.
 They fall in controversies because of
sensitive issues which can affects their
image.
Opportunities Threats