Business & the Business Environment: A Comprehensive Report

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Business & the Business Environment

Contents
Introduction:...................................................................................................................................................2
LO 1...............................................................................................................................................................3
P1 Explain different types and purposes of organizations; public, private and voluntary sectors, and
legal structures...........................................................................................................................................3
P2 Explain the size and scope of a range of different types of organizations...........................................6
M1 Analyse how the structure, size, and scope of different organizations link to the business objectives
and product and services offered by the organization...............................................................................7
LO2................................................................................................................................................................8
P3 Explain the relationship between different organizational functions and how they link to
organizational objectives and structure......................................................................................................8
M2 Analyse the advantages and disadvantages of interrelationships between organizational functions
and the impact that can have upon organizational structure......................................................................9
D1 Provide a critical analysis of the complexities of different types of business structures and the
interrelationships of the different organizational functions.......................................................................9
LO3 Use contemporary examples to demonstrate both the positive and negative influence/impact the
macro environment has on business operations...........................................................................................11
LO4. Determine the internal strengths and weaknesses of specific businesses and explain their
interrelationship with external macro factors..............................................................................................26
Conclusion:..................................................................................................................................................40
References:...................................................................................................................................................41

Introduction:
A business provides goods or services to customers with the purpose of earning profit or serving
society or people. As a business analyst, to understand the impact of business on the economy,
the growth and scope of different businesses and different factors that affect the growth and size
of the business are required. There are many factors that affect the business including internal
and external factors as economic, environmental and political factors. The report includes
different types of organizations working in different sectors as public and private. An
organization includes different function within the organization for different works such as
marketing and operations in the organization so the report shows the interrelationship between
these functions and how the working of these functions affect the working of other functions and
overall working and objective of the organization. The report also presents a SWOT and Porter's
analysis of the organization Marks & Spencer with the purpose of develops an understanding of
starting a new business and understanding the market competition and requirements. So the
report helps to understand the business and factors that affect its objectives environment and
working.

LO 1
P1 Explain different types and purposes of organizations; public, private and voluntary
sectors, and legal structures.
Business organizations are different from one other on the basis of their structure, scope, size,
and sector. Scopes, the size, and structure of these organizations also depend on their objective or
the purpose of working. So in this section, the different types of organization with their scopes,
size, structure and working sector are discussed.
Different types of organizations:
Different types of organizations on the basis of their purpose and working sector are as follows:
Figure 1 Profit and non-profit organization
Profit Organizations:
The aim of these organizations is to earn profits and these are legal organizations. Companies,
partnerships, and sole traders are some examples of profit organizations. The sources of revenues
for these organizations are selling their goods and services (Roberts, 2018). Some examples of
these organizations are as Unilever, Marks & Spencer, etc.
Non-profit organization:
The objectives of this organization are to serve society and not earning profits. The examples of
these organizations are public hospitals, club, trust, etc. Funding sources for these organizations
are fees for membership, charities, and donations. The example of nonprofit organizations
working in the UK is Seedrs and Al-Khair Foundation.

Non-government organizations:
These organizations work independently from the government. The purposes of these
organizations are different as social, political and cooperative (Mian et, al., 2016). The examples
of these organizations working in the UK are A Rocha International and 4thechildern.
On the basis of their structure and sizes of the business organizations, these organizations can be
divided into the following types.
Micro-enterprises: The no of employees in the microenterprises are less than 10 and has a less
annual turnover. The structures of these businesses are simple as they have fewer employees and
small businesses.
Small enterprises: The no of employees for these organizations are less than fifty. And the
turnovers are more than the micro-enterprises. The structures of these businesses are slightly
complex than microenterprises (Goffee and Scase, 2015).
Medium-sized enterprises: the employees in these organizations are less than two hundred
fifty. The structure is complex for these enterprises and the annual turnover is more.
And on the basis of the legal structure of these organizations, the different organizations can be
divided into the following types.
Sole trader:
These are the businesses that require no legal paperwork and include the small businesses as
busking, catering and plumbing. All decision for the business is taken by the owner in these
types of business organization.
Companies: these organizations are legal entities and require paperwork and have a separate
existence from the owner of the organization. The owner of the organization select executives
and managers, and these managers and executives run the business and made all decisions
regarding the business (Storey, 2016).

Franchising:
These organizations are also legal entities and it works on the idea hire out. In the franchising,
one allows others to do business using his idea.
Partnership: These organizations also work according to lows in the country. The act of
partnership, 2002 describes the rules regarding this. The partners for these organizations have
unlimited liability.
So these are the different types of the organization on a different basis of their legal structure and
sector where it works.

P2 Explain the size and scope of a range of different types of organizations.
Scope and size of different types of organizations:
The scopes and sizes of different organizations depend on their objectives, structure and services
and products it provides. So for the different organizations, different sizes and scopes are
described in this section.
Partnership:
The structures of these organizations depend on the size of these organizations which depends on
the number of partners. The services and products provided by these organizations also decide
the size of these organizations. The funding for the organizations is provided by the partners and
the structure and working and all decisions regarding business made by the partners
(Hoogendoorn, 2016).
Sole trader:
The structure of these businesses is very simple as these business owned by a person, which
provides small services to other person or an organization. So the sizes of these businesses are
small. The funding of these businesses is provided by the owner and all decisions taken by the
person. Catering, plumbing are examples of these businesses.
Companies:
Shareholders of the organization own the company and select directors, managers and executives
to run the business. The structure of the company is complex as it has different departments as
information and technology, human resource, research, and development, etc. Size of a company
can vary from a small size to a worldwide company.
Franchising:
The rights of a large company are purchased by an entrepreneur to run the business in
franchising. It has a huge impact on the economy of the US that shows its scope (García-Sánchez
et, al., 2016).

M1 Analyse how the structure, size, and scope of different organizations link to the
business objectives and product and services offered by the organization.
According to the objectives of an organization and services or products provided by the
organization the size, structure, and scope of the organization varies. As an organization,
Vodafone provides telecommunication services, so according to its objective, and its products
and services its size and structure will be different from any other organization as a
manufacturing company or a small organization. For the organization that provides different
products and have a worldwide market as Marks & Spencer the structure, scope and size will be
larger and sole traders or small enterprises the size will be small and structure will be simple.
And to understand the effect of products and services of the organization an example can be
selected of a coffee shop and a car manufacturing organization (Madsen, 2016). The scope, size,
and structure of the organization will be small or less but in a manufacturing company, the scope,
and size of the organization are higher or more. So this shows the link of objectives and product
or services of an organization to the size, scope, and structure of the organization.

LO2
P3 Explain the relationship between different organizational functions and how they link to
organizational objectives and structure
Different functions of an organization depend on the finance, marketing, product design and size
of an organization. Different functions of an organization include Human resource, research, and
development, marketing, etc. These functions play their roles to achieve the objectives of the
organization. For organizations such as Marks & Spencer and Vodafone, these functions work
individually with the support of each other to achieve the objectives of the organization (Yu et,
al., 2016). These departments in Marks & Spencer and Vodafone are divided according to their
structure as both organizations works in a different sector. The communication and cooperation
between these functions are important to fulfill the requirements of the organizations.
The role of different functions as human resource management, operation and finance, and
marketing are different for the organizations. The marketing department is responsible for the
branding of the organization, human resource management works for managing resources and
selecting the employee for the organization, so these functions work different for the
organization but the working of a function affects the working of other function. And the final
objective of all functions is to get the overall objectives for the organization. And this is how all
functions of an organization relate to the objective and mission of the organization as their
different functions support overall objectives and mission of the organization (Vlados, 2019).
Figure 2 Structure of an organization
(Source: WordPress.com)
The structure of organizations depends upon the size and scope of the organization. For the
worldwide organization as Marks & Spencer size and scopes of the organization is larger and
depending on the size and scope the structure of the organization is complex, so the policies of

the organization include encouraging employees for the decision making process. And for the
small organization as in sole traders, all decision regarding businesses is made by the owner and
size of the organization is small so the structure of these organization and micro and small
enterprises are simple.
M2 Analyse the advantages and disadvantages of interrelationships between organizational
functions and the impact that can have upon organizational structure.
Analysis of advantages and disadvantages of organizational function’s relations shows their
effect on working and structure of the organization. For an organization as Marks and Spencer
consider if the research and development department of the organization produced a new product
that has a great requirement or needs in the market then it will help the marketing department for
the marketing and sales of the product. So the functions of a department in the organization help
others and have an impact on the performance of other function. And this requires a team effort
to achieve the objectives of the organization.
D1 Provide a critical analysis of the complexities of different types of business structures
and the interrelationships of the different organizational functions.
The complexity of a business structure varies according to the objectives, scopes, and size of the
organization. For the organization as Vodafone and Marks & Spencer legal requirement, size,
market, and scope of the organization is large so the complexities of the organizational structure
are higher and for the micro and small enterprises and businesses as sole traders the complexity,
paperwork or legal requirements for the organization are less and it decreases the complexity of
these organizations (Crane et, al., 2019). And for competing with the large organization it
requires having a simple structure and good management. The relationship between different
functions of an organization shows how the working of a function of an organization affects the
working and results of other function of the organization. And the interrelationship working and
cooperation of these functions affect overall productivity and working of the organization.
So these are the different organization working in different sectors and the sizes and scopes of
these organizations are discussed. And the relationship between the different functions of these
organization with their impact on organization structure and objectives also discussed in the
report.