BTEC HND Business and Business Environment Assignment Report

This report provides a detailed analysis of various business organizations in the UK, including profit-making, non-profit, and public sector entities. It explores their objectives, areas of functioning, and scopes, using examples like Unilever and The Transparent Hand. The report also examines the interdependence between different types of organizations and discusses the influence of macro-environmental factors on the retail sector, specifically focusing on Morrisons UK through SWOT and Porter's Five Forces analyses. A PESTEL analysis is conducted on the UK retail sector to assess the impact of external factors. The report also touches upon diverse business organization sizes, market share, profit sharing, growth, and stability. Furthermore, it covers various organizational structures and the importance of functional structures for organizational success.

Running Head: BUSINESS ORGANIZATIONS IN UK
0
Business and Business
Environment
Student’s detail:

BUSINESS ORGANIZATIONS IN UK 1
Contents
Introduction.................................................................................................................................................2
SECTION 1.................................................................................................................................................2
Forms of organizations................................................................................................................................2
The Transparent Hand.............................................................................................................................3
Objective of organization....................................................................................................................3
Area of functioning..............................................................................................................................3
Scope of organization..........................................................................................................................3
Unilever Plc.............................................................................................................................................4
Objective of the organization...............................................................................................................4
Area of functioning..............................................................................................................................4
Scope of organization..........................................................................................................................4
The Department for Children, School and Families.................................................................................5
Objective of organization....................................................................................................................5
Area of functioning..............................................................................................................................5
Scope of organization..........................................................................................................................6
Interdependence between different types of organizations......................................................................6
Diverse Business organizations...............................................................................................................7
SECTION 2.................................................................................................................................................9
Influence of macro environmental factors on retail sector.....................................................................9
SWOT analysis over Morrisons (UK)...................................................................................................10
Porter’s five force analysis conducted on Morrisons (UK)....................................................................11
PESTEL analysis on UK Retail Sector..................................................................................................13
Conclusion.................................................................................................................................................16
Bibliography..............................................................................................................................................16

BUSINESS ORGANIZATIONS IN UK 2
Introduction
The following report gives detailed description about different types of organizations like profit
making organizations, non-profit organizations and public sector organizations. In view of this,
an analysis is made over the working structure, area of functioning and size of these
organizations. Herein, a real life business organization Unilever is used as example to understand
the working of different type of organizations. Similarly, Transparent Hand and the Department
of children education and family are taken as references to understand the functioning of
different form of organizations. This report also throws light over the interrelation between
different types of organization and gives a brief about the advantages and disadvantages of their
interrelationship. Moving forward the report describes the role of micro and macro factors in
influencing the business organizations like Morrisons UK. Lastly, PESTEL is conducted on the
retail sector of UK in order to analyze the influence faced by the sector from different variables.

BUSINESS ORGANIZATIONS IN UK 3
SECTION 1
Forms of organizations
An organization refers to a place of work with group of people working for specific objectives; it
requires proper planning, arrangement and coordination to accomplish the objective. There are
different types of organizations, for instance “The Transparent Hands” of UK is a non-profit
organization whose main objective is to provide aid to the underprivileged people of
underdeveloped countries like Pakistan, and contradictory to this Unilever Plc. (UK) is a profit
making organization which earns profits by manufacturing consumer goods. Apart of these
organizations there is one more form i.e. government sector or public sector organizations whose
main objective is to provide best services to people without seeking any personal interest.
The Transparent Hand
Objective of organization
The main objective of this organization is to provide health care services to the underdeveloped
economies, which are facing difficulties to meet their own needs.1 The organization works for
the section of society, which is economically backward, thus the organization does not charge for
these services.2
Area of functioning
The organization works at international platform, it delivers the service in various
underdeveloped and destitute states. The organization has formed ties with a Pakistani non-
governmental trust which gives assistance to the organization to work effectively. The
1P. Drucker, Managing the non-profit organization,London,Routledge,2010.
2 S. P. Osborne, Voluntary organizations and innovation in public service,London,Routledge,2013.

BUSINESS ORGANIZATIONS IN UK 4
organization receives funds from donors to accomplish its goals. Presently there are around 632
supporting donors who have joined this trust as its members.3
Scope of organization
Mission of Transparent Hands is related to cure the sufferings of needy people by granting them
healthcare facility, which is free and easily accessible to them. Presently, the organization has
performed 565 surgeries, 13,582 medical camps and has spent around 507.22K US Dollars on
these operations.4
Unilever Plc.
Objective of the organization
Unilever Plc. is a multinational organization, which was formed after a merger of two big
business firms. It is a well-known organization around the globe for the quality of goods it offers.
After establishing a good repo in international market Unilever focuses on its profits and
margins. As Unilever is a private organization its main aim is to earn maximum profits with
optimum utilization of the resources.5
Area of functioning
Unilever is available in more than 190 countries throughout the world; it is one of the biggest
firms at the international level, which produces variety of consumer goods. Therefore in order to
maintain balance in the functioning Unilever Plc. follows the product division format which
means the brands owned by Unilever are filtered in 4 main product types, for instance health
3 S. V. Puyvelde and R. Caers et al., ‘The governance of nonprofit organizations: Integrating agency theory with
stakeholder and stewardship theories’,Nonprofit and voluntary sector quarterly,41(3),2012,431-451.
4 P. Kotler and P. Kotler, Marketing for nonprofit organizations,US,Prentice-hall,2011.
5 S. Cole,‘The impact of reputation on market value’,World Economics-Abingdo,13(3),(2010),47.

BUSINESS ORGANIZATIONS IN UK 5
care, food and beverage, home and décor etc. There is no interference of government in the
decision making process of the organization.6
Scope of organization
The organization runs as per the set of values and principles, which states that in order to get
success “the highest standards of corporate behavior towards everyone we work with, the
communities we touch, and the environment on which we have an impact.” Unilever has
established its branches throughout the globe; it is selling around 400 plus brands in more than
190 nations. In daily life around 3 million people use products which are manufactured by
Unilever Plc.
The Department for Children, School and Families
Objective of organization
The department for children, school and families is a governmental organization of United
Kingdom whose objective is to ensure safety of children, providing them best quality of
education and also providing safer environment for their overall development. 7. Thus it becomes
clear that these organizations are nonprofit organizations but all the payments and expenditure
made by them is from the revenue generated by the government.8
6 R. L. Daft, J. Murphy and H. Willmott,‘Organization Theory and Design,Boston, Cengage Learning, 2010.
7 Great Britain: Department for Children, Schools and Families,‘Department for Children, Schools and Families:
autumn performance report’(Crown 2007).
8 P. T.Gooby, ‘Root and branch restructuring to achieve major cuts: The social policy programme of the 2010 UK
coalition government’, Social Policy & Administration,46(1),2010,61-82.

BUSINESS ORGANIZATIONS IN UK 6
Area of functioning
These organizations have a limited area of functioning like a state or a nation because every
country has its own set of rules and regulations which can only be applied within the specific
territory. These organizations are more powerful than the other organizations as government of
any nation is most powerful and its action can only be questioned by legal authorities.9
Scope of organization
The constitution of UK provides a framework according to which all these organizations
function. It must be noted that in the public sector organization regular interaction with citizens
takes place in order to ensure weather citizens are satisfied with the services or not.10
Interdependence between different types of organizations
All the organizations existing in the market are somehow dependent on each other, for instance
the non- profit organizations are dependent on the government only when their majority of
resources are aided by government. If the non-profit organization holds a good number of donors
the control of government over its actions reduces. Similarly, the profit making organizations or
private firms are dependent on the government as these organizations require legal authentication
for establishment of the firm in market, until these organizations get the legal certification they
are not allowed to sell products.
Advantages
Performance of each organization can be measured separately. Strong bond between
organizations helps in increasing the business by publicizing the firm name. Interrelation
9S. F. Turner and V. Rindova, ‘A balancing act: How organizations pursue consistency in routine functioning in the
face of ongoing change’, Organization Science,23(1),2012,24-46.
10 A. Wæraas and H. Byrkjeflot, ‘Public sector organizations and reputation management: Five problems’,
International Public Management Journal,15(2),2012,186-206.

BUSINESS ORGANIZATIONS IN UK 7
between the organizations specifies the area of functioning this helps in reducing the chance of
conflicts.
Disadvantages
Every organization has loopholes and these loopholes results in improper functioning of the
organization, if the functional structure of an organization is not proper the correlated firms will
also suffer. Apart from this lack of communication and understanding between the employees.
Diverse Business organizations
There are different sizes of business organizations micro, small, medium and large. The micro
enterprise holds a staff of maximum 10 employees; small size enterprise holds staff of 50
employees whereas medium size enterprise is made up of 250 employees. Then there are large
scale organizations like Morrisons UK and Tesco which holds thousands of employees. These
large enterprises hold big staffs who work in different branches of the same organization.
In UK an organization is considered as SME if its turnover is of not more than £25m whereas
the annual turnover of large scale organizations is more than £20 billion.11
All of the above the size and structure of an organization influences its objectives in various
ways, for instance Unilever being an multinational organization; it requires high amount of
human capital but in past 10 years half of its employees have left the organization which has
11 L. Spence and M. P.Morland,‘Ethics in Small and Medium Sized Enterprises: A Global
Commentary’Germany,Springer,2010.

BUSINESS ORGANIZATIONS IN UK 8
created shortage of employees. This eventually resulted in less productivity and major imbalance
in the management. The organizational structure of Unilever is product type division which is
beneficiary for the core objective of the company. Each product produced by the firm falls into a
specific category with this concept it becomes easier for the operations department to solve
queries and keep everything checked.12
Market share refers to the share of an organization, firm or a company in the market. It is a
matter of concern for organizations who deliver services at huge level, the ratio of their market
share depicts the value of their organization. If a company owns biggest chunk of the total
percentage of the market share among its competitors gradually the value the respective firm
increases. Similarly, profit sharing is one of the most popular concepts in the business
environment. Profit sharing refers to the idea of sharing the net profits earned by the firm with
the employees; the percentage of total share relies upon the quarterly and yearly earnings of the
firm.
Growth and stability are two other factors which are required for establishment of a successful
firm where growth includes the structural, productive and economic growth of the organization.
Stability of a company can be calculated in the terms of increase or decrease in the sales, facing
challenges in arranging capital, action of main employees of leaving the organization and loss of
key costumers.
There are various forms of organizational structures in the business world which can be helpful
construction of an organization, the transitional organizational structure; it is used when the
business is expanded to the international level. Under this the business is divided under either
12 S. Barmmer,S. Hoejmose and K. Marchant, ‘Environmental management in SME s in the UK: Practices, pressures
and perceived benefits’, Business Strategy and the Environment,21(7),2012,423-434.

BUSINESS ORGANIZATIONS IN UK 9
geographical division or product division. Secondly, the international organizational structure is
headed by Chief Executive Officer under whose guidance 4 major divisions function namely
operations, human resource, marketing and finance (all these divisions have separate area of
functioning). Lastly, the global organizational structure functions only on the basis of
geographical division. These are large organizations with massive turnover therefore it is
required to keep a check on every location where the products and services are supplied.
In order to become successful, an organization should focus on its functioning. The functional
structure of an organization keeps the main objective of the company in center of attraction, it
also helps in defining tasks to the employees each of them is entitled to perform particular task,
this increases the efficiency and coordination of workers. For instance, the transparent hand
which is a non-profit organization, its main aim is to provide aid to the needy people of different
nations.
SECTION 2
Influence of macro environmental factors on retail sector
There are large numbers of Macro Economics factors which are affecting the retail market of
UK. An in-depth research work is conducted by various economist like Robert Altman who has
used the concept of “augmented distributed lags” in order to describe that the gross national
product, gross corporate profits and supply of money can make impact on the firm’s ability to
survive.
A part from this strict monetary policy and hike in the interest rate can alter the cost of
borrowing of a company, this makes the financial situation of corporate sector badly and hence it

BUSINESS ORGANIZATIONS IN UK 10
will lead to the destabilization of the corporate sector. Fluctuation in the inflation can affect the
consistency of cash flows and will surely diminish the firm’s capability to pay the interests over
its debts.
SWOT analysis over Morrisons (UK)
Morrisons is a superstore functioning in UK, Europe with more than 500 stores. The organization
has developed an online website which is helpful in providing services directly to the consumer
i.e. his home or office etc.13 Morrisons is basically a retail organization which deals in food
products , the company has its own production sites , this gives both company and consumer
satisfaction that the product are of good quality. In the 2017, entire income produced by
Morrisons was £16.3 billion, this made Morrisons fourth top supermarket chain of UK.14
Strengths- The strengths of Morrisons are as follows, the company holds a well-managed chain
of product dispersion. Prime aim of the company is to focus on needs of the households;
therefore it provides different articles which can be used by people in their daily living like
music, beverages, clothes and edible goods. As a result, the company has managed to earn the
title of leading chain of supermarket industry in UK. It has also listed its name in the London
stock exchange and FTSE index. One of the utmost strength of Morrisons is online services,
which has multiplied its income in last few years.15
13 D. Petrovici ,Jr Nagya and A. Fearne, ‘Nutritional knowledge, nutritional labels, and health claims on food: A
study of supermarket shoppers in the South East of England’, British Food Journal, 114,2012,768-783.
14 R. Scolozzi and E. Morri, ‘Ecosystem services-based SWOT analysis of protected areas for conservation
strategies’, Journal of environmental management,146,2017,543-551.
15 J. Cunningham and B. Harney, Strategy and Strategists,Oxford,Oxford University Press,2012.

BUSINESS ORGANIZATIONS IN UK 11
Weakness- Morrisons faces some weakness like the prior thing comes under notice is the
geographical reach of the company is comparatively far less than other brands. The legal matters
faced by the company in relation to the it poor previous experiences may leave a bad impression
on the mind of consumer. All these matters degrade the image of company in market.16
Opportunities- Morrisons had a great opportunity of tying up with other brands, Morrisons do
not need an introduction thus large number of firms are agree to join hands with it. This
partnership can be extremely fruitful because firstly they reduced competition. It also increases
the overall productivity of the organization.17
Threats- Last but not the least moving to onto the threats faced by the organization are the
competitive firms. The companies like Asda, Walmart, Amazon and boots are the organizations,
which pose serious threat over the sales of Morrisons UK.
Porter’s five force analysis conducted on Morrisons (UK)
Herein, the Porter’s five force analysis is also applied to the Morrisons supermarket. “The Porter’s
five force analysis includes the following aspects competitive rivalry, supplier power, buyer power,
threat of substitution and the threat of new entry”.18
16Howard, Simon, J.Adams and M. White, ‘Nutritional content of supermarket ready meals and recipes by
television chefs in the United Kingdom: cross sectional study’,Bmj,2012,345.
17R. Varley, Retail Product Management: Buying and Merchandising,London,Routlegde,2013.
18Howard, Simon, J. Adams, and M. White, ‘Influences of food hardness on the particle size distribution of food
boluses’, Archives of oral biology, 58(3), 2013.