Business Practices Report: Unilever, Structures and Factors

This report examines Unilever's business practices, organizational structures, and the influence of external factors on its performance. The introduction defines business and highlights the selection of Unilever as a case study, exploring its operations across over 190 nations. The main body delves ...Read More

Business in Practice

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
SECTION 1..................................................................................................................................1
SECTION 2..................................................................................................................................3
SECTION 3..................................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business is termed to an enterprising firm which is engaged professional and commercial
related practices (Bos and Millone, 2015). In business, effective practices are set of ideas and
guidelines that represents most prudent course of actions in pertaining situation. In business, best
practises are framed by authorities including regulators and governing bodies for smoothly
performing workings towards objectives. For the assessment, Unilever is selected company that
is a large sized venture having headquarters in the city of London, United Kingdom. It is one of
oldest multinational entities whose offerings are available in more than 190 nations.
The assessment investigates about micro, medium size, small as well as large size
business as per definition, characteristics and suitable example. Further, it explains distinct
entities ranging from sole traders, limited liability entity, cooperative and partnership. It also
discusses various business structures and the ways external factors impacts on practices and
performance of company.
MAIN BODY
SECTION 1
Definition, characteristics as well as examples of different business
Business is a delineated as an activity to generate living of an individual and making
revenues through manufacturing and selling. In other terms, it is an organised effort of people for
producing together with selling commodities for profit (Buckley and Ghauri, 2015). The
definition and other details of various business that are investigated by analysts of Unilever are
as follows:
Basis Micro
organisation
Small
organisation
Medium
organisation
Large
organisation
Definition Micro enterprises
are defined as units
of business that hire
fewer population
and earns for day to
day living.
Small company is
described to a not
for profit
business that is
independently
owned, operated
Medium
businesses are
termed within
Companies Act
2006 as
organisation with
A company which
have manpower of
more than 1000
people and diverse
product portfolio
for making large
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and controlled. workforce of 250
people and is
family owned
institution.
number of money.
Features Features of micro
businesses are
mentioned below:
 Micro
enterprises
employ
around 10
people.
 These are
financed
through
micro
credit.
 These
operated for
providing
goods
within local
communitie
s.
Characteristics of
small
organisations
areas follows:
 Small
organisati
ons have
annual
turnover
of approx
£6.5
million.
 They
target
small
market
segment.
Attributes of
medium
businesses are
underneath:
 the
employee
size of the
company
is up to
250
people.
 The
ownership
of the
business is
separated
from
organisati
onal
manageme
nt.
Large business is
characterised as:
 Profit
making is
main
objective
(Buppert,
2020).
 The
business
have diverse
product
portfolio.
 It targets
overseas
customers.
 The
combined
turnover of
the entity is
nearby £ 1.7
trillion.
Example Proviz is a micro
entity which is
established with
goal of
CafePod Coffee
Co. is a kind of
small business
thatruns with
Verdant Leisure is
a type of medium
organisation that
is a bespoke
Unilever is an
example of large
business that have
divers product
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manufacturing
commodities which
have possibilities to
make a difference
towards lives of
customers.
spirit for
producing strong
as well as
exciting coffee
for coffee
drinkers that are
adventurous in
nature.
vacation park
operator which
offers self
catering lodge as
well as caravan
holidays.
portfolio of baby
food, energy
drinks, personal
care and many
more to make huge
profits.
SECTION 2
Definition, characteristics together with examples of distinct companies
In business environment there are different types of companies which are operating for
the purpose of selling their products and services in contemporary environment and attaining the
higher profits. For each organization it is important to analyse their situation and formulate the
planning accordingly which can help to manage the business and attain profitability (McDonald
and Eisenhardt, 2020). The description of different companies are as defined:
Basis Sole trader Partnership Limited
liability
Public limited
liability
Cooperatives
Definition This means a
business
which is
operating by a
single person
as having all
responsibility
and power to
make decision
in single hand
is known as
sole trader
This means a
business
which is
operating and
handling by
two and more
than two
person which
can help to
increase the
organizational
performance
This means an
organization
which is
operating and
handling by
many people
but up to their
limits which
can help to
increase the
organizational
performance
This is public
based
company that
is operating by
people who
arrange the
funds by
issuing share
publicly and
run the
business
effectively.
This can be
defined as
organization
which is
authorised by
the state as
single
organization
and recognised
for filling the
needs and
wants of
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(Bennett and
et.al., 2019).
and maintain
all activities.
and
profitability.
societies.
Characteristics Sole trader is
owned by
single person
as it is
operating at
small level.
The person
has unlimited
liability.
This person
enjoys entire
profits.
This business
does not
follows any
government
regulations.
Contractual
relationship
between two
and more
partners.
Maintaining
flexibility.
Partners are
sharing mutual
benefits.
Design a
partnership
deed by
deciding the
profit and loss
ratio.
Equal rights.
This entails
separate legal
entity that is
different.
Limited
liability
protection that
save members
from higher
losses.
Management
and operation
flexibility.
Taxation
flexibility
provided in
this
(Füllbrunn and
Luhan, 2020).
There is
separate legal
entity.
Legal capacity
to own
property and
incur debts.
Shares are
offered by
public limited
company
which are
transferable.
Funds are
collected from
public hence
they have
voting rights.
This
corporation is
owned by
many
shareholders
as they are
part of
organization.
This has
limited
liability.
This has their
own lifespan.
Maintaining
business
security and
continuity.
Examples CafePod
Coffee Co. is a
small size
company
which is
operating by
sole trader by
offering
different taste
Proviz Sports
is assessed as
partnership
organization
which
established by
two brothers
Anthony and
Rupert Langly
Verdant
Leisure is
privately hold
company
which is
operating by
shareholders
by diving their
task and
Unilever is
categorised in
public limited
company that
is providing
multinational
consumer
goods by
arranging all
Heart of
England is
consumer co-
operative in
UK that is
selling the
variety of
consumer
products and
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of coffee. The
person who is
operating
business have
power to make
decision and
put efforts to
expand the
business in
challenging
environment.
Smith for
providing
design, high
visibility of
sportswear.
The partners
understand
needs of
people and
bring the
products and
services
accordingly.
liability. This
organization
offers holiday
homes to
customers.
activities and
functions. The
organization is
maintaining
the sales and
profitability by
allocating
roles and
responsibilitie
s between
members
(Andrews,
Ferry,
Skelcher and
Wegorowski,
2020).
services in
changing
environment.
This is
operating for
the purpose of
filling society
needs.
SECTION 3
Identification of distinct organisational structures as well as explanation about how structure
of company affects business productivity
Organisational structure comprises of relationships among multiple members of a firm. In
other words, it is a framework in which managerial addition to operational practices are
undertaken (Caldera, Desha and Dawes, 2019). Effective organisational structure results in
prompt, useful as well as intelligent decision making which assist business to improve
productivity along with raising overall efficiency. Distinct kinds of organisational structures are
as identified:
Hierarchical organisational structure: The structure is said to chain of command in
venture wherein information from top executives to general employees. In this structure, passage
of information takes huge time because of which decision making are not done promptly that
leads to affecting productivity of business adversely. If administrators of Unilever uses the
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structure then that have to face complicated command chains and inconsistencies in
management.
Divisional organisational structure: This kind of structure segregates whole business
into smaller divisions based on specialised areas. If managers of Unilever follows the structure
then it allows wider operational efficiency as all human resources with shared knowledge,
abilities and skill sets works together for achieving productivity. However, the structure creates
limitations in communication among divisional groups that decreases flexibility addition to
innovation resulting in reduced productivity.
From the discussion, it is analysed that managers of Unilever have adopted divisional
organisational structure in which the business is divided into various components on the basis of
focus (Young, 2018). The structure helps the company to manage development, production,
promotion, distribution and sales of all its consumer products across international market that
impacts positively on its productivity in terms of sales volume and revenues.
Use of PESTLE Analysis for explaining the ways different kinds of external factors affects
business performance
PESTLE Analysis is used as framework to analyse macro environmental factors that have
chances and capacity to affect organisational performance. Unilever is a multinational company
that operates from UK and faces changes in external situations. With the help of PESTLE
Analysis, analysts of Unilever have analysed together with monitored various external factors
that affects its performances in the market. The factors and the way they affects performances of
the company are below:
Political: It is related to how political system intervenes in specific industry and
influences their performances (Mougayar, 2016). In UK, political leaders are responsible to
execute trade restrictions and governance. For example, Brexit was a decision of political system
of UK in which UK based organisations including Unilever have to close down stores in cities
European Unions that affected negatively in its performances to make money.
Economic: UK is a country which have highly developed economy. However, in context
to Unilever, factors such as purchasing power of consumers impacts on Unilever as when its
products are not in demand than consumers do not purchase them which influences its cash flows
in negative manner. At same time, inflation and whims of audiences also influences performance
of the entity largely.
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Social: This kind of external factor scrutinise social surrounding of a market as well as
gauges elements such as population analytics, cultural trends, attitudes of consumers and hence
forth. In UK, population have desires for innovative and distinguished commodities. In context
to various of Unilever's products, they emphasis more on personal care together with well being.
The entity expresses powerful desires to assist society feel good (Zellweger, 2017). However, the
attitude of citizens of society changes rapidly that affects performances of Unilever widely.
Technology: Within consumer market of UK, technology is changing fastly so that new
products as per desires of target audiences are manufactured and delivered promptly. In
relevance to Unilever, the entity is focusing to improve its digital marketing addition to selling
methods. The business have higher automation level that allows it to supply commodities to far
store locations quickly. However, managers have analysed that adopting or updating
technologies
Legal: The factor is related to legislations and governance that affect environment of
company in a nation as there are various policies which are maintained for the business
themselves. In UK, changes in laws such as Minimum Wages Act, Data Protection Act and many
more affects productivity of Unilever as the managers have to made key modifications in their
policies that matches the changes. It takes huge time and results in hampering organisational
productivity to large extent (Zizlavsky, 2016).
Environmental: It comprises all the influences which are related to natural environment
of a nation. In UK, environment factors is crucial for the industry in which Unilever operates as
there are various initiatives which are mandatory for the company to adhere. Some includes
reducing carbon emission, improving greenery and so on. When Unilever fails to protect the
environment and its actions leads to hampering environmental aspects such as climate,
environmental offsets and so on them it have to make its all focus towards improving them.
Because of this, the focus of company lacks towards business activities that affects its
performance largely.
CONCLUSION
From the report it can be concluded that different types of business are exists in the
environment which are operating by different person such as sole trader, partnership, public
limited liability, and corporation. The structure of organisation is used to maintain effective
communication and attain business goals. Organisational structure assist in eliminating
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duplication of activities, faster decision making, better communication, improving operational
efficiency, reducing employee conflicts and greater productivity. PESTLE analysis is used to
analyse how external factors influences a business. There are various elements of macro
environmental factor that leads to affecting productivity of firm.
REFERENCES
Books and Journals:
Andrews, R., Ferry, L., Skelcher, C. and Wegorowski, P., 2020. Corporatization in the Public
Sector: Explaining the Growth of Local Government Companies. Public Administration
Review. 80(3). pp.482-493.
Bennett, R. J., and et.al., 2019. The Age of Entrepreneurship: Business proprietors, self-
employment and corporations since 1851. Routledge.
Bos, J. W. and Millone, M., 2015. Practice what you preach: Micro finance business models and
operational efficiency. World Development.70. pp.28-42.
Buckley, P. J. and Ghauri, P. eds., 2015. International business strategy: theory and practice.
Routledge.
Buppert, C., 2020. Nurse practitioner's business practice and legal guide. Jones & Bartlett
Publishers.
Caldera, H. T. S., Desha, C. and Dawes, L., 2019. Evaluating the enablers and barriers for
successful implementation of sustainable business practice in ‘lean’ SMEs. Journal of
Cleaner Production.218. pp.575-590.
Füllbrunn, S. and Luhan, W. J., 2020. Responsibility and limited liability in decision making for
others–An experimental consideration. Journal of Economic Psychology. 77. p.102186.
McDonald, R. M. and Eisenhardt, K. M., 2020. Parallel play: Startups, nascent markets, and
effective business-model design. Administrative Science Quarterly. 65(2). pp.483-523.
Mougayar, W., 2016. The business blockchain: promise, practice, and application of the next
Internet technology. John Wiley & Sons.
Zellweger, T., 2017. Managing the family business: Theory and practice. Edward Elgar
Publishing.
Zizlavsky, O., 2016. Innovation performance measurement: research into Czech business
practice. Economic research-Ekonomska istraživanja.29(1). pp.816-838.
Online:
Young. J., 2018. Unilever's Organisational Structure. [Online]. Available through:
<http://panmore.com/unilever-organizational-structure-product-innovation>
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