Analysis of the Contemporary Business Environment in the UK: GSK

This report provides a comprehensive analysis of the contemporary business environment in the United Kingdom, focusing on the economic and non-economic factors that shape organizational behavior. It delves into the impact of the Brexit, economic policies, and conditions on businesses operating in the UK. The report uses GlaxoSmithKline (GSK) as a case study, examining its background, market position, and how it navigates the UK's business landscape. A detailed literature review explores the economic environment, including economic systems, policies, and conditions, as well as non-economic factors like natural and demographic influences. The analysis includes SWOT and PESTEL analyses of GSK, providing recommendations for adapting to the changing business environment. The report concludes with an overview of key findings and their implications for businesses operating in the UK.

Running head: UK: CONTEMPORARY BUSINESS ENVIRONMENT
UK: CONTEMPORARY BUSINESS ENVIRONMENT
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Author Note

1UK: CONTEMPORARY BUSINESS ENVIRONMENT
Table of Contents
Introduction.................................................................................................................................................3
Discussion....................................................................................................................................................3
Contemporary business environment of the UK.....................................................................................3
Company Background..............................................................................................................................4
Literature Review....................................................................................................................................4
Discussion and Analysis...........................................................................................................................8
Recommendations.................................................................................................................................14
Conclusion.................................................................................................................................................14

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Abstract
Contemporary business environment of the United Kingdom can be identified and understood by
dealing with the external and internal environment of the respective country. The contemporary
business environment of the United Kingdom is shaped by unique global economic turmoil and
challenges that have been brought by the changing scenarios of global trade and commerce
accelerated by the Brexit. The respective paper is an analysis of the UK’s contemporary business
environment with special reference to the famous healthcare company of the UK named
“GlaxoSmithKline”.

3UK: CONTEMPORARY BUSINESS ENVIRONMENT
Introduction
To understand the contemporary business environment of a nation, one has to deal with
the external and internal environments of the respective nation (Abreu and Grinevich 2013). The
contemporary business environment of the United Kingdom is shaped by unique global
economic turmoil and challenges that have been brought by the changing scenarios of global
trade and commerce accelerated by the Brexit (Snyder 2015). However, the business
environment of the United Kingdom still remains positive, forward looking and is open for all
kinds of experimental entrepreneurship (Du and Temouri 2015). The United Kingdom in today’s
world is considered to be the sixth largest global economy and one of the world’s top ten
manufacturers. The United Kingdom is also considered to be world’s second largest service
exporter after the US. All the headquarters of European companies are situated in the United
Kingdom making it a desirable nation on the international platform. The respective paper is an
analysis of the UK’s contemporary business environment with special reference to the famous
healthcare company of the UK named “GlaxoSmithKline”. In the particular report, economic and
trade environment of the UK is analyzed by literature review and the company has been
overviewed with SWOT and PESTEL analysis along with a detailed understanding of its
business environment.
Discussion
Contemporary business environment of the UK
To understand the contemporary business environment of a nation, one has to deal with
the external and internal environments of the respective nation. The contemporary business
environment of the United Kingdom is shaped by unique global economic turmoil and

4UK: CONTEMPORARY BUSINESS ENVIRONMENT
challenges that have been brought by the changing scenarios of global trade and commerce
accelerated by the Brexit. However, the business environment of the United States still remains
positive, forward looking and is open for all kinds of experimental entrepreneurship. The United
Kingdom in today’s world is considered to be the sixth largest global economy and one of the
world’s top ten manufacturers. The United Kingdom is also considered to be world’s second
largest service exporter after the US. All the headquarters of European companies are situated in
the United Kingdom making it a desirable nation on the international platform.
Company Background
GlaxoSmithKline plc (GSK) is a British multinational pharmaceutical company that has
its headquarters in London. The company has been established in the year 2000 as a merger
company of Glaxo Welcome and SmithKline Beecham. GlaxoSmithKline has been considered as
the largest pharmaceutical company according to Fortune 500 in the year 2019. The company
has its fame because it is the first company in the world to design the first vaccine against
malaria. Apart from that, the products that the company produces and sells come under World
Health Organization’s list of essential medicines, therefore, the popularity of the company
among healthcare practitioners, doctors, nurses and health workers is far reaching and lofty. The
average revenue of the company ranges up to 33.754 million pounds on an annual basis. The
number of employees who work in GlaxoSmithKline are up to 99,437 according to the latest
figures of 2019. The employee turnover of the company seems to be relatively low
(Gsk.com.2020).
Literature Review
Economic environment and impact on organizational behavior

5UK: CONTEMPORARY BUSINESS ENVIRONMENT
Avilova, Gulei and Shavyrina (2015) in their respective article has written about how a
socio- economic and economic development of a region/ state gives rise to a customer- oriented
organizational culture at the backdrop of a university. The article is important because it reveals
how a workplace can develop itself into customer centered approach through the development of
organizational culture that is fueled by economic development of the area where the workplace is
operating. The professionalization of labor force is revealed in the paper which provides a
different insight in the paradigm of HR management. The empirical research data of the paper
talks pros and cons of an organization’s customer favored approach towards the business in an
upcoming and a prolific economy.
Fiaz, Su and Saqib (2017) in their respective article have talked about how economic system and
development have given rise to various leadership styles and organizational performance and has
subsequently affected the employee performance. The article has dealt with various typologies of
leadership, which are, autocratic, democratic and laissez- faire styles while carrying out the
research. The outcome of the research was that autocratic leadership showed negative employee
performance and democratic and laissez faire leadership showed positive employee performance
at the backdrop of an emerging economy where there is low to mild per capita income, dime- a-
dozen available labor force, commodity and currency swings and high potentials of growth. The
paper has highlighted one of the most pressing problems of emerging economies, which is lack
of effective organizational leadership. The paper has talked about how the countries with
emerging economy tackles the situation of lack of proper leadership and the ways by which
organizational aspects behave at the backdrop of a developing economy.
Bida et al. (2015) in their article have talked about the importance of HR interventions in the
organizational behavioral context at the backdrop of an emerging economy. In the prelude of the

6UK: CONTEMPORARY BUSINESS ENVIRONMENT
article, the authors have written about how important is HR intervention in a company to
increase its competitive advantage in the market. The article then talks about the importance of
employee performance and engagement in the emerging economic nations such as China, India,
Pakistan and Vietnam. The article has given example of how poor economy of Nigeria has
caused poor employee performance that resulted in a complete disruption of industrial
management making Nigeria a poor industrial country. The reasons for poor employee
performance in emerging economies or poor economies have been tried to be analyzed in the
respective article. The article is important because it gives an idea that economic development of
a nation is important for the improvement and enhancement of employee performance and
organizational behavior which would finally lead to a prospering economy and trade conditions
benefiting the respective nation by contributing to its GDP (Gross Domestic Product).
Cahill et al. (2015) in their article examines the extent to which job satisfaction, employee
engagement, employee performance, organizational behavior, work- life balance and human
resource interventions are influenced by the changes in the macroeconomy. The data that is
needed to be carried out for the research have been accumulated through Age and Generations
dataset where over 2000 employees have been surveyed. The outcome of the research was that
macroeconomy impacts on the job satisfaction, employee performance, work life balance and
human resource interventions. The article is important because it exhibits that the root causes of
such issues are not only bestowed on the family domains and job conditions but also the macro
and microeconomy of the country where the organization might be operating.
Yuhertiana et al. (2017) in the article has talked about the relation between the unscrupulous
behavior of the tax mongers and the reluctance of the tax- paying employees in an organization.
The paper explores the effect of organizational commitment, culture, and tax reforms on tax

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ethics. The paper highlights the effect of taxation on the employees and subsequently, the effect
on organizational performance due to the erratic behavior of the employees, therefore, the paper
is important and significant towards understanding economic ups and downs and how that can
affect organizational behavior.
Non- economic environment impact on organizational behavior
Guillaume et al. (2017) in their article has written about workplace diversity where they
have stated that workplace diversity is optimized and moderated by demographic factors of the
nation/ state where the organization has been built. While the paper begins with the belief that
diversity is the key to any organizational success, the paper also exhibits the fact that diversity
driver in an organization is highly dependent on the demographic nature and demographic shift
of the nation where the organization works. Demography plays a very important role in
determining socio- economic conditions of a nation and the productivity of the same. Similarly,
organizations operating in a heterogeneous demography often mark themselves as organizations
that practice diversity to form an egalitarian workplace environment with growth and
development of all people beyond any kind of discrimination.
According to the article written by Williams and Schaefer (2013) many small and medium sized
organizations in the United Kingdom have taken up pro- environmental organizational
engagements with particular focus to climate change. The researches for the article was done by
surveying certain leaders or team leads of some small businesses that are environmentally active
regarding what different types of environmental activities they have inculcated in their firm how
they are motivated to do so and their understanding of climate change. The respective paper is
important because it shows how environmental factors can cause changes in organizational

8UK: CONTEMPORARY BUSINESS ENVIRONMENT
behavior and practice. The article is important and significant in understanding organizational
behavior and how they are influenced through external sources and aspects.
Howard-Grenville et al. (2014) talks about the perils of climatic change that the world is
witnessing in the recent happenings. The paper talks about the negative effects of climate
change, such as shortage of food crops, rise in prices of food, spreading of diseases and
epidemics have given rise to a new kind of managerial problem, which is decrease of employee
performance. The paper deals with various ways by which organizations are gearing up to tackle
and control climate change so that their organizational activities are not hampered. The paper has
highlighted how organizational activities related to sustainability are viewed by the employees
and staff and the reactions they give. Such actions and reactions have direct and also indirect
effect on organizational behavior. The research findings of the article suggest that organizations
that carry out good practices of sustainability are successful in retaining employees and staff
more than the organizations that do not. Organizations find that employees are pretty intrigued
and also interested to support and engage themselves in activities that promote sustainability and
tackles climate change, according to the findings of the research. In the article, organizational
scholars have tried to explore whether subjects such as motivation, commitment, identification
and pro- social behaviors are differently manifested when issues like climate change are
confronted by an organization.
Discussion and Analysis
Company
GlaxoSmithKline, which is commonly known as GSK, is a multinational pharmaceutical
company whose estimated revenue is approximately 33.754 million pounds. GlaxoSmithKline
plc (GSK) is a British multinational pharmaceutical company that has its headquarters in

9UK: CONTEMPORARY BUSINESS ENVIRONMENT
London. The company has been established in the year 2000 as a merger company of Glaxo
Welcome and SmithKline Beecham. GlaxoSmithKline has been considered as the largest
pharmaceutical company according to Fortune 500 in the year 2019. The company has its fame
because it is the first company in the world to design the first vaccine against malaria. Apart
from that, the products that the company produces and sells come under World Health
Organization’s list of essential medicines, therefore, the popularity of the company among
healthcare practitioners, doctors, nurses and health workers is far reaching and lofty. The average
revenue of the company ranges up to 33.754 million pounds on an annual basis. The numbers of
employees who work in GlaxoSmithKline are up to 99,437 according to the latest figures of
2019. The employee turnover of the company seems to be relatively low.
The respective paragraphs would ensure the SWOT analysis of GlaxoSmithKline which
would assess Strengths, Weaknesses, Opportunities and Threats of the company related to the
external and the internal environment of the United Kingdom (Madsen 2016).
Strengths
GlaxoSmithKline that has emerged as a powerful company in the UK has strengths to survive in
the fierce competitive business environment of the United Kingdom.
1. Great market performance: GlaxoSmithKline Plc has become an expert in browsing new
markets, entering into them, penetrating and performing well. As the organization has
expanded to a greater extent, the company has built profit streams, monetary fund and
differentiated cycles of various market economies where it functions
(Independent.co.uk.2018).

10UK: CONTEMPORARY BUSINESS ENVIRONMENT
2. Automation of activities: Automation of activities has been able to bring consistency on
quality of the respective company products and have also made sure that the company
provides enough supply of products according to the conditions of demand in the market.
3. Commendable returns as revenues from the capital expenditures: The company has
received success in the implementation and execution of new projects and have also
successfully generated good returns on capital expenditure by building new revenue
streams.
4. Talented and qualified human resources: The employees of the company are highly
skilled and qualified in their respective field. The company spends a huge amount of
money on developmental programs of the workers. The HR interventions of the company
is relatively premium. The company has the strategies of human resource that are directly
aligned with the business goals and objectives, therefore, they are able to take whatever
they need from the employees and motivate them to even work for better in future. The
learning and development programs that they very often conduct in their organizations
make the workforce highly skilled and ensure that the employees are the most productive
in their operations. It is considered to be one of the greatest strengths of the company.
Weaknesses
1. Research and development areas: The company has not invested well in the research and
development department lately than that of its peers. It has not been in a position to
compete with the leading players in the pharmaceutical industry when it comes to
research and development and innovation. It has to be remembered that the world is
changing in a faster pace and innovation has remained the one and only key by which the
companies can create an awe in the society and arrest attention. The more innovative a

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company, the more will be its interests among the general public. In such case,
GlaxoSmithKline company has not performed well.
2. No unique market positioning: a product, in order to be famous in the market, need to be
positioned in a proper way in the market that would make the product different from the
other products. In the respective case, GlaxoSmithKline has been able to sell its products
to a greater extent but the market positioning of the products are not that premium when
it comes to the other competitors, such as Frank Ross pharmacy. Unique positioning will
add to the branding of the product which would in turn, help the products to have a
differentiated edge in the market.
3. Limited success out of core business: Even though the company GlaxoSmithKline is
considered to be one of the leading multinational pharmaceutical organizations, its
industries have faced challenges such as moving the product segments into different
market cultures. The company is a big one but has to be made bigger by colossal yet
successful attempts thereafter.
4. Technologies: The company has not been investing on technologies lately.
GlaxoSmithKline is a company that needs to invest more in technologies of the
organization so that they are able to integrate the organizational processes to make
business run faster. More investment in technologies would mean more premium
products which would lead to the better functioning of the company.
5. Expenditure on workforce: As the company has a mindset to make the workers skilled
and qualified for their jobs, they spend a lot of money on training programs, courses,
learning and development and other programs such as internships and online assessments