Analysis of External Business Environment: Marriott Hotel Report

This report provides an in-depth analysis of the external business environment affecting Marriott Hotel. It examines the impact of the legal and political environment, including local government structures, taxation policies, and employment regulations within the UK. The report assesses the influence of the EU on the business, considering legal and economic aspects, and the implications for employees. It further explores the role of pressure groups and their political influence on national and local issues, emphasizing their impact on the hospitality sector. The report also covers the statutory requirements for establishing and developing a business, analyzing different business types and the legal processes involved in company formation and dissolution. Finally, it discusses the structures and processes that determine responsibilities and control within a registered company, providing a comprehensive overview of the external factors shaping Marriott's operations.

EXTERNAL BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
EXTERNAL BUSINESS ENVIRONMENT..................................................................................1
INTRODUCTION...........................................................................................................................3
TASK 1 ...........................................................................................................................................3
TASK 2 effect of legal and political environment on business and service industries....................3
2.1 Structure, operations and influence of local government in major UK hotel group..............3
2.2 Evaluating role and influence of EU and its impact on business and service industries.......5
2.3 Role of pressure groups and their political influence in relation to national and local issues
......................................................................................................................................................6
2.4 Analysis of legal framework within UK................................................................................8
2.5 Evaluating the UK and EU legislative process......................................................................9
TASK 3 statutory requirements for establishing and developing a business and service operation
........................................................................................................................................................10
3.1 Assessing different types and characteristics of business that operate within business and
services.......................................................................................................................................10
3.2 Legal processes necessary for formation and dissolution of registered company...............12
3.3 Structure and processes that determines responsibilities and control within registered
company.....................................................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14
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INTRODUCTION
The concept of external business environment includes factors that prevail outside the
organization. Further, these possess the ability to affect the functions of firm to a greater extent.
Because of such reason, these factors become uncontrollable and unmanageable by the manager
though executing of several strategies in order to control the situation (Chang, Hughes and
Hotho, 2011). The term business environment is regarded as a sum of all the factors that
influence business operations. It includes both internal as well as external factors. External
environment of business is comprised of macro factors that include political, social, economic,
environmental, legal as well as technological. These affect corporation directly or indirectly to a
great extent. In the present era, tremendous growth has been encountered in the hospitality sector
(Fraser and Pong, 2009). It has greater share in GDP (Gross Domestic Product) of United
Kingdom. With the increasing domain of its working, it has enhanced the range of sectors. This
includes tourism, hotels, catering and events. Thus, with the extension in every area, it brings
changes along with the development in economic condition existing within nation.
In the present report, external business environment has been discussed with context to
Marriott hotel. The firm is an international hotel company. It is a flagship brand of full service
hotels and resorts. It is one of the leading groups of hotels which has several branches around the
globe. The present report entails to understand the effect of legal as well as political environment
on the business and service industries. In addition to this, it also includes statutory requirements
in order to establish and develop business and service operations. The study makes analysis of
the legal framework existing within UK. Moreover, it includes determination of differences
existing between English and Scottish system.
TASK 1
Covered In Power point presentation
TASK 2 EFFECT OF LEGAL AND POLITICAL ENVIRONMENT ON
BUSINESS AND SERVICE INDUSTRIES
2.1 Structure, operations and influence of local government in major UK hotel group
Structure and operations of local government in the UK
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Due to existence of long history of legacy, that control and govern constituencies, the
structure that is being possess in UK is planned and systematic one. It consists of hierarchy of
government officials. On the basis of Westminster system, form of government that prevails in
UK is parliamentary. It is categorized into three which includes local, central and state
government. Further, local government operates either in one tier system or two tier system. One tier system: In the UK, one tier system exists that is considered as unitary authority.
As a result of existing system of one tier, there is presence of large cities and towns in the
section. These include city councils, country councils, district councils as well as borough
councils (Hamilton and Webster, 2015). As it is a system of single tier, thus there is
greater responsibility possessed by authorities for entire operations. This involves
transport, social care, housing leisure, transport planning, local taxation collection,
highways and recreation etc. Two tier system: This system is comprised of country and district councils. The former
can be defined as smallest government unit that is public directly. In addition to this, it
addresses the issues relating with waste disposal, passenger, social care, libraries,
highways, transport, education etc. However, district council covers greater area in
comparison to country council (Hult, Hurley and Knight, 2004). This is comprised of
categorization of various countries that possesses responsibility of housing, recreation,
health, local taxation, planning, local tax collection and environmental. Being segmented
into smaller areas, it carries out several functions regarding its maintenance.
Local government impact on hotel group
There is a greater impact of local government operations on the functions and working of
hotel group. This has been enumerated as under: Policy of taxation: It is a duty of local government to collect taxes and increase revenue
for the country. There are several kinds of taxes being imposed on hospitality sector.
These include sales tax, corporate tax, income tax and service tax (Rodiek, 2008). Such
taxes to a greater extent have direct impact on the profitability and revenue generation of
hotel group. This compels administration to bring alterations in tariffs as well charges of
services that are prolonged by firm.
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 Inflation policy: Firm like monetary policy of committee of bank of England makes
determination of interest as well as other bank rates. Such results in influencing the
decisions which are being made by hotel group (Singh and Mahmood, 2014). In case of
lower rate of interest, there is increased attraction towards investment that results in the
expansion of venture. Later, it leads to enhancement in the quality of services.
 Employment policy: In UK, efforts are made by the local government with an aim to
enhance the talent and efficiency of the personnel working in varied section of the
industry. In this regard, it has devised certain policies as well as regulations that are for
their protection (Stackelberg and et.al, 2010). Moreover, it addresses issues relating with
salaries, precaution and safety along with offering healthy and resourceful culture of
working. This assists hotel group in following all the laws and regulations along with
maintaining legality.
2.2 Evaluating role and influence of EU and its impact on business and service industries
European Union is one the international businesses that operates with an aim to stabilize
the conditions of its member countries in relation to various areas. This includes factors such as
economic, social, political, environmental and trade. It is the business wherein freedom as well
as liberalization are granted to all the member countries. This is comprised of relaxation in tariffs
and custom duties as well as free movement of factors for the production (Carroll and Shabana,
2010). This works to optimize the working and operations of member countries which can lead
to growth and development. Further, policies are imposed on the member countries and thus, its
influences dribble down the firm who operates within the country. This affects strategies and
policies which are developed by it in several dimensions specifically relating with profit margins
and generation of revenue. Service sector possesses 78% of market share which includes
considerable amount of hospitality sector. Further, this gets influenced by the working of EU.
Legal aspects
When certain rules and regulations are being laid down by the firm in varied aspects then
this has impact on firm and their functions. Laws relating with consumer protection charge and
fare the services in accordance with their quality, ensure authenticity as well as accuracy of the
segments (Chabowski, Mena and Gonzalez-Padron, 2011). Further laws regarding environmental
issues such protection and maintenance of climate and atmosphere has adverse impact on
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industrial working. In order to adhere with the same when entertainment facilities are provided to
travelers and visitors focus is given on protecting the environment.
Economic aspects
The organization like EU offers greater relaxation to its member countries. This involves
lowering the rate of tariffs as well as custom duties, lowering rate of interest and free movement
of factors of production that prevails in member countries (Lee, 2011). This result in emergence
of provision to the hotel groups regarding hiring of efficient candidates from across the globe. By
infusing talent employees within the firm quality services can be delivered that can ensure
smooth flow of work.
Employees
The role of employees is vital in carrying out the operations of the firm and their
successful implementation. In order to retain particular amount of employees functioning within
the country EU has devised several laws and regulations in order to protect personnel and
enhance their efficiency (Filatotchev and Nakajima, 2010). There is reduction in costing when
firms are allowed for free movement of factors of production. In addition to this laws have been
developed so as to offer better opportunities for job and growth to the personnel. In this regard
training and development programs are organized. As such it leads to enhancement in the skills
and talent of the workers. Further exposure is given to them in terms of advanced world and
regions.
2.3 Role of pressure groups and their political influence in relation to national and local issues
Pressure groups are considered group of individuals who are neutral politically. Further
they function for the purpose of influencing opinions of country in relation to increasing growth
and development within the nation. Their role is crucial in making amendments and
improvement in political system. They possess wider working areas that affects several aspect of
the nation. This leads to influencing the operations of firm and its working. Hospitality is
regarded as one of the fastest growing industry in UK. This industry is considered customer
oriented as such its working relies on preferences and choices of the customers to a significant
level (Lee, Olson and Trimi, 2012). In addition to offer quality services their aim to comply with
the laws and regulations that are being established by the regulatory authority as well as
legislative bodies. The role of pressure group is significant in stabilizing conditions within the
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nation. Further it ensure maintenance of legality. The perform in the manner enumerated as
under:
 To make sure that all the regulations and obligation that are being developed by
regulatory authority are complied with in an appropriate way. Firm takes into account all
the components.
 They have duty to keep a track on activities so that no harm is caused to the environment
as well as atmosphere. Hospitality sector is engaged in offering services like
entertainment and adventure trips that has influence on natural resources of the country to
a greater extent (Nofsinger and Wang, 2011). Thus it is ensured by pressure groups that
protection of environment is done and no compromise is being done by organization in
relation to its prevailing situation.
 The aim of the pressure groups is to make enhancement within the economy and political
conditions that exists in the nation. They keep an eye on the existing working
environment and culture that bounds the personnel to work. Regular monitoring of the
facilities that are offered to personnel is done with the aim to protect their interest and
ensure equality.
 The role of pressure groups can be viewed towards affecting the laws and regulations that
are developed by government and other regulatory bodies. Alteration is done in the
political and administrative structure when there is influence of pressure groups. This is
in terms when they put pressure on legislation to bring amendments in the prevailing law
in order to enhance it. As such this can improve the condition that exists within the
country.
 Pressure groups are comprised of expertise and specialist who possess knowledge of
different fields. There major focus is on improving the efficiency and capabilities of the
employees. This results in increasing the profitability and generation of revenue within
business such as Marriott. In this hotel each personnel is functioning in different segment
such as human resource, marketing and finance etc. Thus it become significant for firm to
enhance the quality (Piecyk and McKinnon, 2010). With the assistance of monitoring and
checking on frequent basis firm can carry out training and development programs in
order to give them exposure of quality and effective services.
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2.4 Analysis of legal framework within UK
The legal framework within UK is categorized into three systems. This includes Scotland,
Northern Ireland and English & Wales. The parliament of UK keep control over all the regions
apart from Scotland through its laws and regulatory framework. The different kinds of laws are
stated as under: Common law: These are developed by judges sitting in courts. They make application of
their knowledge and skills of legal precedent to the case and gives judgment for it. As it
is interpreted from the judgment developed in the previous case thus it is considered as
Case law (Piecyk and McKinnon, 2010). This is due to the reason that similar judgment
has to be given in situation when same case comes up in the court. The doctrine of
precedent presents that lower courts are bound by judgment provided by higher courts. Statute law: It is predominated by parliament and follows common law. In situation there
is presence fight among the two statutes then later one prevails. Statute law governs
abortion (Shaw, Grant and Mangan, 2010). Further consent power is determined by
mental capacity Act as well as English Common Law.
 European law: European Union possess list of members countries which also includes
UK. Thus its regulations needs to be incorporated into English law officially before it is
being applied in the court (Weske, 2012). The principle of Human Rights Act 1998 is
being applied in UK. It presents that every court has to duty to make interpretation of
legal framework so far as required in the rights developed in ECHR (European
Convention Human Right). Therefore now breach of right would be taken care by UK
courts rather European courts of HR in Strasbourg.
There is presence of various points of difference between English and Scottish system. Such has
been demonstrated in the table below:
Basis of difference English system Scottish system
Responsibilities With respect to English system
there is responsibility of
regulatory authority for the act
which are performed by them.
However in case of Scottish
system there is no obligation
on the regulators to prosecute
their rights. But they can
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breach the issues.
Formal cautions In case of English system there
is requirement for regulators to
carry out their performance in
relation to publishing of
formal caution when the
process of prosecuting is being
carried out (Wheelen and
Hunger, 2011).
In contrast to this in case of
Scottish system there is no
need for taking into
consideration such type of
caution.
Legal system This type of system follow
common law. In addition to
this it is the legislation that
prevents the children from
legal cases who are below 18
years. In addition to this there
is legal right possessed by bars
and hotel to provide alcohol 24
hours a day.
However in Scottish system
civil and common law is being
followed. It is the law that
prevents children under age of
16 years from the legal cases
(Aula, 2010). Moreover it
states that only hotel possess
the legal authority to provide
alcohol 24 hours a day.
Witness statement In case of English system this
has crucial role when criminal
process as well as acts like
evidence is being carried out.
In contrast to this Scottish
system does not takes into
account evidence in law court.
2.5 Evaluating the UK and EU legislative process
Legislative procedure which is being followed by UK and EU is as such. This has greater
impact on the functions of Marriott at both the level that is national and local. With respect to
this it has been examined that legislative procedure which European Union complies with is
more complex as compared to UK system. The government of United Kingdom has developed
some laws and regulations that acts as an aid in preventing hospitality organizations. Several
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legislation are exists, that are being taken into consideration by the organizations. This includes
Minimum Wage Act 1998 as well as Environmental Protection Act. The firm is required to
undertake Minimum Wage Act as with this employees can be provided with greater assistance
regarding gaining appropriate Wages from Marriott international. Thus this does not have impact
of the rights relating with employment. The acts possess implication in relation with the firm is
required to comply with suitable rates of wages in order to protect the rights of the personnel.
Further in situation which business fails to conduct such act then there is complete right
possessed by the person to file complaint against the hotel. On the contrary European Union
conducts various legislative practices that includes Right to equality as well as Right to
employment. For instance, it is significant for the organization to undertake these right as it
makes sure that effective practices are being carried out that would result in offering greater level
of satisfaction to the employees (Aziz and Yasin, 2010). Later this assist in attaining desired
targets to an effective manner. It has been presented by the Right to Equality act that personnel
must not be discriminated. Moreover it is important to provide them equal opportunities. In
addition to this they need to consider the skills as well as abilities possessed by employees and
then offer suitable task. This is for the purpose of attaining appropriate services from them. It
also acts as an aid in satisfying the requirements of the workers with effectiveness. In situation
when discrimination is being performed by the firm over employees then EU possess the
authority to take legal actions against the hospitality organization.
TASK 3 STATUTORY REQUIREMENTS FOR ESTABLISHING AND
DEVELOPING A BUSINESS AND SERVICE OPERATION
3.1 Assessing different types and characteristics of business that operate within business and
services
Business is referred to as the firm that makes utilization of economic resources or offers
goods as well as services to the customers. There is presence of several kind of business
organization within the hospitality industry. These have been enumerated in the manner stated as
such: Sole trader: It is the kind of the business that is owned, run and managed by an
individual. It is considered simplest form of organization that can be established easily
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that is with least cost. The liabilities of the entire firm is borne by single person in case of
sole proprietorship. In case of death of owner the whole business gets terminated. Further
the risk is undertaken by single owner. This involves professional people, providers of
services, traders, retailers and small businessman. Under this the activities of finances are
maintained separately from the personal financial activities of the owner. Partnership: This kind of business involves two or more person who contributes
resources within the organization. Under partnership business partners works with one
another in order to attain common organizational target. The contribution made by each
partner is in the agreed ratio (Beynon-Davies, 2013). They make contribution of capital,
resources, property, personnel as well as share of profit and loss of the organization in
proportion. The formation of such firm is categorized on the basis of liability. Partnership
with limited liability limits the partners’ personal liability. However in case of unlimited
liability projection all is done under unlimited risks and liability. Corporation: Every business possess separate legal entity from its owners. The
ownership of the firm is in the hands of shares of stock. Shares represent the corporation
in the stock market. Limited liability and limited contribution is enjoyed by the
stockholders who are working in the company. Further board of director are considered
the elected group from among the stakeholders. For instance, Marriott hotel possess such
type of business structure. Stockholders are being prevented from liability. The personnel
of the business who are its shareholders gain advantage of certain tax free benefits like
health insurance. Travel agent: It includes all the travel agents. They possess major role in relation with
booking of tickets and making arrangements of holiday packages for customers (External
business environment, 2015). Another major feature of this business is to address the
queries of customers that relates with traveling. Voluntary organization: They are also referred to as non-governmental firms. These are
regarded as organizations that are developed voluntarily in order to contribute towards
social welfare with the society. It makes contribution towards participating in awareness
as well as working of several issues relating with social, political as well cultural
conditions.
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 Public limited company: It is considered as the business whose aim is to work for the
betterment of the society. The major benefit of such business type is relating with raising
of funds within minimum time span. Under these firm it is essential to follow legal
obligations. For example, it is essential for public limited company to have at least 2
directors.
3.2 Legal processes necessary for formation and dissolution of registered company
It is important for the individuals to follow some legal procedures in order to open new
business. This is because in situation when such is not complied with then the firm would not be
considered valid. In this relation the steps that needs to be complied with are enumerated as
under: Memorandum of association: The initial stage in process of company's formation relates
with Memorandum of association. It is important document that involves detail in
company's name, location of firm's headquarter and liabilities of involves parties. There
is greater need for organization to develop this document. This is due to the reason that
with this organization can establish itself with effectiveness. Articles of association: Following the development of Memorandum of association net in
the series in creation of article of association. This document states rules and regulations
that are required to follow by business (Smith, 2008). It possess effectiveness in terms of
setting direction of firm with respect to regulatory and ethical path. Form 10 and form 12: After the development of both the kinds of documents another
stage relates with developing two kinds of forms. In form 10 information is offered in
relation to date of birth of members, their home address and passport number. Likewise
form 12 is type of declaration in which director of organization is required to make
declaration that in situation of bankruptcy they will be accountable.
 Deciding name of company: After the accomplishment of the aspects stated above the last
part is regarding the decision on the name of the firm.
3.3 Structure and processes that determines responsibilities and control within registered
company
The organization that possess limited structure has members like director, secretary of
company as well as shareholders. The individual’s defined need to comply with various roles and
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