Analysis of Business Environment and JP Morgan Finance Report

This report provides a comprehensive analysis of the business environment, focusing on JP Morgan Finance and Investments. It begins by defining the business environment and exploring different types, sizes, and scopes of organizations, including sole traders, partnerships, and limited companies. The report then examines organizational structures, specifically functional and divisional structures, and their relationship with various functions like production, human resource management, and finance. The core of the report involves a PESTLE analysis of JP Morgan to assess the impact of political, economic, social, technological, legal, and environmental factors on its operations. Following this, a SWOT analysis is conducted to evaluate JP Morgan's internal strengths, weaknesses, opportunities, and threats, further exploring their interrelation with the PESTLE factors. The report concludes by summarizing the key findings and implications for JP Morgan's strategic decision-making in a dynamic business landscape.

Business and Business
Environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Different types, size and scope of organization......................................................................1
CONCLUSION......................................................................................................................4
TASK 2 ...........................................................................................................................................4
Organisation structure............................................................................................................4
Functions of the organisation.................................................................................................6
TASK 3............................................................................................................................................7
PESTLE Analysis of JP Morgan ...........................................................................................7
CONCLUSION......................................................................................................................9
TASK 4............................................................................................................................................9
Swot Analysis Of JP Morgan and internal factors impacts on business ...............................9
Explaining interrelated with PESTLE factors .....................................................................11
CONCLUSION ...................................................................................................................12
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment is regarded the internal and external environment in which
company regulate its business operations. There are various factors in business environment that
provide major influence on decisions and functions of organisation. Further, there are various
kinds of entities depending upon the size and scope. In present context, analysis of JP Morgan
Finance and investments which is 4400 establishment across the world and is one of leading and
most respected investment company. In this report, there are various kinds, size and scope of
ventures have been discussed such as sole trader, partnership, limited, public limited and
voluntary business enterprise. These major enterprise have their existence in UK and provide
major contribution towards growth and development of economy (Blockeel and et.al., 2016 ).
In addition to this, different types of organisation structure is also discussed along with
the introduction of its relationship with other functions. Further, analysis of macro environment
factors and their influence on business operations of organisation is also evaluated in this
report. PESTLE analysis model is used to determine the influence of macro environment factors
on business operations. At last, SWOT analysis model is used to determine the influence
internal environmental factors on business operations.
TASK 1
Different types, size and scope of organization
Organization is analysed as social unit which is structured and managed in order to meet
the requirement and pursue the collective goals. It is also considered as an entity which
comprises various people that has a particular goal and is also linked to an external environment
(Hilton and Platt, 2013). Every business enterprise has a management structure which
determines relationship between their different activities and members and assigns roles,
responsibilities and authority in order to carry out different tasks. Different organization have
distinctive purpose behind regulating business operations such as profit maximization and
gaining market share. In UK, Tertiary sector mainly has its existence which involved
commercial services that support the production and distribution process Eg retail, transport,
advertisement, warehousing insurance.
Sole trader or sole proprietorship is simple business structure in which established one
individual, runs and owns the entire business operations. They are legally responsible for every
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aspects of their business, and personally liable for their business's financial resources. In this,
employer can generally make all the decision about introduction and running business as well as
hiring individuals (Carroll and Buchholtz, 2014). The main advantage of this creating this
venture is that it contains low start-up cost and helps in regulating business operations in the
easiest manner. Employers sole trader are only responsible for outcomes of their decisions.
However, unlimited liability for debts is considered as disadvantage because there is no legal
distinction between private and business assets. Individual needs to face various issues in getting
financial resources for establishment of business. For example: Legability Ltd is a sole trader
who offers the services of bookkeeping which is a local, a friendly and running by a family
business with the main offices in Calne and Taunton. It is a professional business which was
established in 2002 and was incorporated in December 2003. The company specialises in putting
the needs of the clients at a high priority and offers the rates according to the competition. The
entity is registered with Institute of Certified Bookkeepers (ICB) and has been provided the
practising licence. Services offered by the company are- Bookkeeping, Sole Trader in
Accounts/Tax Returns, Small Company Statutory Returns, Partnership Tax Returns, VAT
Returns, Management Accounts, Payroll, Credit Control and Cover for Maternity/Long Term
Sickness. The next example can be cited of Gary J Harding, which is also a sole trader and a
chartered accountant. The Gary J Harding Chartered Accountants in Hemel Hempstead, the
proprietor believes in helping the business men of UK in such a way that they can get best out of
their business. The company offers variety of services in accountancy, tax planning and planning
of businesses in local areas in and around of Hertfordshire. The company works for appreciating
the value of its clients in order to grow and get success in the business. The entity aims at
achieving the goals of its clients in a reliable and friendly manner.
Partnership is analysed as formal agreement in which two or parties corporate with each
other to manage and regulate a business. Various important partnership arrangement are possible
in which all partners which might share liabilities and profits equally or some partners will have
limited liability. In partnership, financial resources are invested by parties in a particular
proportion in which they share profitability (Wetherly, 2014). Every individual is are
responsible for carrying out business operations and they are also liable for profits & loss.
Partnership provides an opportunity for income splitting an advantage of particular importance
due to resultant tax savings. However, disadvantage of partnership venture is that the liability of
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the partners for the debt of business is considered as unlimited (Boons and Lüdeke-Freund,
2013). Every partner is considered as agent of partnership and is liable for all actions performed
by other parties. For example: Greenergy International Ltd., is a partnership firm with main
partners as TESCO and Caradog. It is a British distributor of fuels for motor vehicles the
blending of fuel takes place at Thames Estaury in South and Teesside in the north. The company
has sales of over 20 million litres of petrol and diesel per day. Till 2015, the entity ranked 474th
in the fortune 500 companies of UK.
Limited company is analysed as organisation in which the liability of members of
organization is limited to their investment. It can also be limited by shares or guarantee. It is also
considered as private owned enterprise which is established two or more individual with an aim
to maximize profitability (What is a Limited Company?, 2010). Director of organisation are
considered as employees who are responsible for administration of business operations. It also
regarded as legal structure that ensure that the liability of company members is limited to their
stake within enterprise through their way of investments (Smith, 2016). Tax benefits is
considered as main advantage of a limited company as payment of tax is considered as major
concern for enterprise. In its case, only the amount of profits are subjected to tax and their rate
of tax is lower than other business ventures (Hair and et.al., 2015). The members of
organisation have limited liability. However, company make distribution of power to more and
more people which may lead to arguments between the directors and shareholders. For example
TESCO, which is a British multinational company deals in grocery items and is a general
mechanise retailer in England, UK. According to the measurement of gross revenues the
company is a largest retailer in the country. It hs its ventures in total seven countries with the
market share of around 28%. the entity has the diversification geographically from the early
1990s into the areas of retailing of books, cloths, electronics, furniture etc.
Public limited organisation is analysed as business enterprise that is able to offer its
shared to the public. These business ventures are established two or more people with an aim to
maximize profits. This organisation can operates within a legal structure of partnership or
separate legal entity. Most obvious advantage of introducing a public limited company is that it
has the ability to raise the share capital, particularly where the organisation is listed in the
recognised change. Offering shares to the public provided the major opportunity for
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organisation to share the risk of company between the large number of shareholders. For
example, Aalberts Industries, is a public limited company of UK is based of 'mission-critical
systems. There are total four businesses are run by the company which are- building installations,
climate control, industrial control and industrial services.
CONCLUSION
Business environment of an organisation includes both internal and external factors affecting the
business. It is very essential for an organisation to identify the strengths and weaknesses, threats
and opportunities in order to exist in the ever changing business environment of the market. The
report has been concluded by analysing the organisational structure and external as well as
internal factors affecting the working of JP Morgan Finance and Investments. The study has
helped to analyse the risk of getting failure to the organisation in the operations of the business.
The organisational structure developed is helpful in forming the strategies for business for
making responses to the changing environment of the market for the organisation.
TASK 2
Organisation structure
Organisational structure- It is a system that provides direction to the activities of organisation
that is helpful in the achievement of targets and goals of the organisation. The activities of the
organisation consists of rules, roles and responsibilities. It also helps in determining the flow of
information within the organisation (Bouazza, Ardjouman, and Abada, 2015).
Types of organisational structure:
Functional structure- This structure focuses on the division of tasks. The functions being
divided into the smaller parts with the particular tasks and roles of the organisation. Functional
structure provides the flexibility to the organisation in such a way that the employees can be
divided according to their skills and functions in the department, so that they can focus to the
collective energy as a department for achieving the targets of the organisation.
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Divisional structure- There are various large companies which have to operate in the different
horizons to achieve the objective uses the divisional structure. Divisional structure offers the
autonomy to employees within their allotted groups in organisation. After following this
structure, every group in each of the division operates essentially in the own company
controlling the resources and funds required.
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Illustration 1: Functional structure
(Source: Types of Organizational Structures, 2018)

JP Morgan Finance and Investments deals in global securities and banking facilities and is a
retail banking firm. The entity majorly provides the financial services. The company follows the
divisional structure in the organisation as it offers the great flexibility to the organisation. Each
division in the organisation allows each employee to work efficiently ion each department in
order to achieve the target of each department and of the organisation as a whole.
Functions of the organisation
Production function- Production function is that function of an organisation which aims to
convert inputs into outputs. It is necessary for the firm to purchase all the essential material
required and then should convert it into inputs. It is mainly the result of mainly cooperation of
four factors that are land, labour, capital and organisation. Not a single product can be product in
the absence of any of the mentioned factors (Carroll and Buchholtz, 2014).
Human resource management- It is considered as the backbone function of an organisation
which is a strategic approach to the effective working of operations in the management of an
entity. HRM helps the organisation to achieve the competitive advantage in the ever changing
environment. This function is focussed on the management of individuals in the organisations,
considering the policies and the systems. It is responsible for overseeing the benefits of
employees, recruitment, training and development of existing as well as of new employees,
appraisal of performance and rewarding the employees.
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Illustration 2: Divsional structure
(Source: Types of Organizational Structures, 2018)

Finance Function- It can be defined as assessing and providing the funds which are required by
the enterprise on various terms keeping the objectives in view. The coverage of the function has
been widened in the recent years in order to include the instrument that can provide the funds,
institutions and practises by which funds can be generated (Hair Jr and et.al., 2015). Finance
function impacts each and every operation of the firm and that is the reason it is used in the
broad sense by the organisation. Judgements in the finance includes the decisions of making
investments in the assets or not or it can benefit the enterprise ad can generate the revenues or
not. This function also determines the policy for management of assets and allocation of profits.
Marketing function- It is considered as a role with the help of which a company can identify the
sources of reaching to the customers with the potentially successful products. It is major strategy
to take the product to the market place by an organisation. It plays a vital role in the promotion of
business and carrying the objectives. It I like a face to the enterprise where it is very easy to
analyse the roles and actual picture of an organisation (Hilton and Platt, 2013).
There is a vast relation between all the functions of management in JP Morgan Finance and
Investments as the interrelatedness is the only reason which pushes the organisation to achieve
its targets. Without production marketing is not possible, it is important to develop the product.
Similarly, without finance function human resource management will not able to work properly
as there will be no clear information about the funds available and recruitment and each every
process in the organisation needs finance to carry out it in an effective way./
TASK 3
PESTLE Analysis of JP Morgan
Political Factors:
These factors play a very important role in determining factors that effect business operations in
different countries and political regions. To achieve success in such a changing environment in
money centre banks industry across the world Morgan has to diversify the risk taking political
environment systematically (Smith, 2016). Morgan can closely analyse following factors before
entering into certain kind of dynamic environment: political stability of the market, trade rules
and regulations related to financial matters, level of corruption, favourable trading partners, are
there any pricing regulations or not, anti-trust laws related to money matters, tax rates and
incentives, employee benefit, etc. Its positive impact is that because of so many rules and
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political factors available in the market there are low chances of any fraudulent by any person or
organisation. And negative aspect of it is that there is a dynamic environment in the availability
of such type of factors in the economy. Because of this market strategies need to be refurbished
on a regular basis and it is difficult for Morgan or any other organization to do so.
Economic Factors:
Macro environment consist of factors such as inflation rates, interest rates, savings rates, foreign
exchange rate. In such an environment where these type of factors are present, aggregate demand
and aggregate investment in the economy are determined by these factors only. Morgan is
affected by the following factors of the economy: stability of currency of host countries, their
exchange rates, to raise capital in local market company will need to check efficiency of
financial markets, level of skilled employees available in the host country, education level of
economy, etc (Wang and et.al., 2016). Positive impact of these factors on company is that, when
micro environment such factors such as competition norms give competitive benefit to the
company and negative impacts due to factors of macro environment such as inflation rates,
fluctuating interest rates, etc. can result in change of plans and policies of the company relates to
financial matters or investment.
Social Factors:
Society culture plays important role in putting its impact over the company and culture and
environment of the company. As well as beliefs and attitudes of population also plays a crucial
role in marketers of Morgan will understand the customers of a given market. This factor include
following factors that put an impact on the company: skill level of population, hierarchy to be
followed in the economy, social conventions, etc (Wetherly, 2014). On a positive note change in
the socio culture environment can lead to good impact on the morale of employees and can
result in more efficient workforce. On the other hand Morgan need to give great emphasis on
socio cultural values of the customer to survive in this competitive market with competitors like
Bank of America.
Technological analysis:
Technology is very dynamic. There is always something new and innovative in the world.
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It has affected JP Morgan is a positive way. It makes communication with their customers easier
which makes their work performance efficient. Banking services has also been provided by the
bank. This ensures that the customers do not need to go to the bank for simple tasks. Payments
and transactions are hassle free. It has also helped the company in the area of competition
amongst other banks. But, because of the changes in technology, the company has to change it's
cost structure and there will be a changes in the rate of technological diffusion and their value in
the financial sector (Saleem, 2017).
Legal Analysis: There are various laws that have been introduced throughout the years. They are
essential to ensure a smooth functioning of the companies and organisations in any country. This
helps to avoid and lessen the illegal activities that are done. JP Morgan has to carefully follow
the legal rules and regulations, to protect the intellectual property rights of their company. They
are to evaluate the risks in the area which they work in and follow the framework, which include
fixed interest rates, financial transaction charges, loan amounts, etc (Wetherly, 2014). They have
to ensure data protection of their customers and employees, enforce antitrust laws, discrimination
law, intellectual property law, consumer protection, employment law and health and safely law.
Environment Analysis: JP Morgan has to take care and analyse the work they do and make
sure that it affects the environment in a positive manner. The environment is the place where we
work and it needs to be in good condition. They should create campaigns for awareness for
important causes such as using renewable energy, recycling, saving endangered species and
reduce the usage of plastic. If they don't abide to the environmental laws, they have to face
consequences (Zalengera and et.al., 2014). They can even lose their customers who are
conscious of the environment. Creating campaigns and awareness of the protection of the
environment will help them get a good share in the market in their industry
CONCLUSION
The PESTLE analysis of JP Morgan shows that all the factors are in their favour. The
technological analysis shows a positive perspective, with easy and quick performance. But with a
negative perspective of their employees adapting to change. The legal analysis shows that it
sincerely abides to the rules and regulations of the country's law and the environmental analysis
shows that they care about their environment.
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TASK 4
Swot Analysis Of JP Morgan and internal factors impacts on business
Strength
It had huge distribution network as it has 4400 offices worldwide. It is considered as one
of leading and respected organization in United kingdom. It had presence of various range of
financial services which consist of investment banking, market personal financial services,
commercial banking and different financial services and products. It had number of operations
which serves numerous clients, customers and business. It has presence of very strong capital
along with its liquidity. In the context of diversification, its streams are balanced and diversified
along with its revenue (Smith, 2016). It had gained huge credit ratings as it had created capability
for leveraging its global operations. There is presence of huge expansion of numerous digital
strategies. It is also known as leading underwriter for numerous securities of equity and other
instruments of investments.
Weakness
It had various increment on its expenses as it is weakening its management along with
non interest expense of organization and expense of operation has been raising from year to year.
The organization has formed numerous non interest expense which is more than 50% of its total
net revenues in the last year.
The company has face problems regarding strict financial competition which are exercise
their services in the financial matters. The fluctuating markets result due to instability is
weakness of the company (Wang and et.al., 2016). The over dependence of company in USA
has great weakness. IT structures of organization was not sufficient in their operation which
affects business. Transferring of employees payroll which affects from cancellation of
outsourcing agreement with IBM. This also affects employees productiveness and overall
operation of business. The new consultant helps in implementing strategy and serving in
transformation which causes company has obtained extra expenses. Due to workload for existing
employees which decrease in productivity has weakness of the company. The merger with bank
has to create 12000 lay-offs which affects JP Morgan. Company is highly dependent on North
American and its revenues has the biggest weakness which affects images and reputation.
Opportunities
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