Business Environment Report: Micro Focus International PLC Analysis

This report delves into the business environment of Micro Focus International PLC, a British multinational software and IT company. It begins by outlining the company's structure as a public limited company and how it is governed, including the roles of key personnel like the chairman and CEO. The report then emphasizes the importance of PESTLE analysis as a strategic tool for understanding external market conditions, identifying threats and opportunities, and making informed business decisions. It highlights the cost-effectiveness, in-depth understanding, and ability to exploit opportunities that PESTLE analysis provides. The main body applies the PESTLE framework to analyze the external environment's impact on Micro Focus International PLC, considering political, economic, and social factors, and their potential effects on the company's operations, profitability, and long-term success. The report considers the impact of political instability, economic fluctuations, and societal trends on the company.

BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Determine the structure of Micro Focus International PLC and how it is governed..................1
Analyse the importance of conducting PESTLE analysis...........................................................2
Use PESTLE framework in order to analyse the impact of external environment.....................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business environment is the collection of internal and external factors which impacts the
working conditions of business. These factors include many components such as suppliers,
competitors, technologies, trends and other related market conditions. These are the forces which
influences the businesses form the external side of business boundaries (Prajogo, D.I., 2016).
While running a business, it is required to keep in mind that the external and internal factors
impact each other and also work collectively which impacts the business conditions. In order to
carry forward this report, Micro Focus International PLC is considered which is a British
multinational software and IT company located in Newbury, Berkshire, England and company
offer software services and provide consultancy. In this report, suitable structure of company is
describe and also how it is governed. Moreover, it also describe the importance of conducting
PESTLE analysis for an organisation and lastly, use it to determine the potential factors which
impacts the working conditions of company.
MAIN BODY
Determine the structure of Micro Focus International PLC and how it is governed
Micro Focus International PLC is the public limited company which is owned and
directed by the government and public bodies. Public company is a corporative which is owned
and distributed among the general public shareholders by conducting free trade shares in order to
exchange its stock and products. Public companies are formed with the legal structure and
system and also run by the government of state (Bah, E.H. and Fang, L., 2015).
How public companies governed
Public companies refers to those companies which are undertaken at its initial public
offering by offering its shares of stock to the public and also raise additional capital. For this,
company is subjected to consider the requirements of public and also consider the shares which
are listed on the stock exchange. Just like the private limited company, PLC is an incorporated
business which is owned by Board of Directors from the behalf of shareholders and also has an
AGM which is related to the various key issues of company. Here, there is a main difference
among the PLC and private limited company as they sell their own shares on the stock exchange
in order to become the member of public by which finance can be raise in significant manner.
Legal structure of public company
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 Local government: This government plays an important role in order to collect funds
which is collected in the form of community charges and also known as Council Tax. For
this, Local government plays an important and unique role in order prevent and determine
the requirements (Belás, J.,and et. al., 2015). For this, they analyse and figure out the
various sources of funding and relationship features which is useful in dealing with the
new sector. Moreover, they support the companies by keeping themselves within the
limits of Local Government Act. State government: This government share their powers and authority with national
government. For this, there are many services which can be controlled and managed by
state government and here, few goods and services can only be availed by state
government. Central government: It include different business activities which are controlled,
managed and directed by the national government and also have proper control over the
business and its functioning. For this, central government has suitable power in order to
develop laws and legislations for the whole country by coordinating with local
government. Organisations that are operated by central government should take
permission from them regarding the operational activities of company and also need to
take permission before taking prominent major decisions.
Information regarding the onboard directors of company
The corporate governance require the suitable role of chairman and chief executive
officer that should not be performed by same person. Here, the formerly non-executive chairman
is Kevin Loosemore and has been appointed as the role of executive chairman or chief executive
officer in 2011. Currently, the onboard chairman of company is Stephen Murdoch and Nils
Brauckmann who joined the board team in 2016.
Analyse the importance of conducting PESTLE analysis
PESTLE analysis is a framework which is used by marketers in order to determine the
external conditions of market. As a result it is useful in identifying concerned threats and
opportunities and to conduct this, it is important to analyse the priority of business which provide
strong indication as it impacts the standards of business (Bah, E.H. and Fang, L., 2015). It is
analysed as the strategic planning method which is useful in reducing the business threats by
gaining the valuable benefits for company. Moreover, its benefits are useful in describing the
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idea phase, development of product, launching and suitable marketing strategies which is useful
in increasing the success of company. This framework is considered as the most cost effective
which provide deep understanding of business and its benefits are discussed as under: Cost effective: Cost considered for PESTLE analysis is just time and for this, extra
components can help to organise and arrange the input and feedback of this framework
which is completed by thoroughly going through a simple document. It is considered as
the simple and straight analyse and by conducting this, the expansion and launch of
company become more cost effective and useful in eliminating the risk factor of company
(Virglerova, Z., Dobes, K. and Vojtovic, S., 2016). Here, proper amount of research is
conducted as it is important but carry lot of time with it and company has probable option
to opt this framework which is useful in eliminating the risk factor. Deep understanding: By conducting PESTLE analysis, it is helpful as it provide deep
understanding regarding the business environment which directly and indirectly impacts
business conditions. For this, company need to overlook the safety and also follow the
consumer laws while developing the product into new market area. For this, company
need to analyse the technological barriers which occurs in front of them as it is helpful in
understanding the demand and requirements of customers in the highly populated areas
(Moroni, I., Arruda, A. and Araujo, K., 2015). In regard of this, company need to work
appropriately in the current business environment and also export the other side of
country in order to avoid the financial disaster. For this, PESTLE analysis plays an
important role which is useful in helping out the differences and determine the influential
factors which impacts the success and progress of product launch. It is also useful in
encouraging the enhancement of strategic thinking to get deep understanding of planning. Alertness developed: This framework is useful in determining and analysing the various
factors in broader sense as it is currently displayed in narrowed term and also useful for
specific products, developing the marketing plans and building the customers
relationships. It is considered for the new developments of in company and this
framework is useful in enhancing and raising the awareness regarding the respective
threats. This factor provide alert and prominent information regarding the existing
competitors, future competitors and so on. For this, if company will get suitable
understanding regarding the growth of population as it is useful in analysing the
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appropriate business conditions. Company can predominantly target its market area
which is analysed among the suitable range of 20-30 as it increases the chance to reach
towards the new audience by considering the new product. In regard of this, PESTLE
analysis is useful in developing ability of examining the changes and also develop
suitable plans to increase the profitability.
 Exploit opportunities: Opportunities comes from the external side of business
environment. For this, with the help of PESTLE analysis a study is framed for the
external environment and its concerned opportunities which is found and considered as
the opportunity for business. For this, company is able to conduct research regarding the
technological and social trends which is useful in targeting the market and moving
towards the new social media channels (Groşanu, A., and et. al., 2015). This approach
can become the opportunity in developing a marketing campaign before the present
competitors. This framework provide outstanding approach which is useful in offering an
opportunity to convert these factors into user friendly to customers. Here, PESTLE
analysis plays an important role in order to analyse and exploit the suitable opportunities
to regulate within the business environment in effective manner and also eliminate the
risk factor.
Use PESTLE framework in order to analyse the impact of external environment
PESTLE analysis is useful in providing and offering a valuable insight to the operating
challenges within an industry and also appears as the face of company. For this, suitable
understanding is provided for the overall competitive conditions which is useful in preventing
the investors and entrepreneurs to take part in the risky ventures and depicts the arises risk
regarding the political authorities and uncertain economic recession (Eling, M. and Schaper, P.,
2017). For this, the sudden fallout in any kind of factor may impact investors in order to pull out
the new enterprises and also gets prepare regarding the sudden situation and decisions. Political: These factors impact the profitability and chances regarding the survival of
company which are quite diverse. For this, political risks varies by appearing the sudden
and uncertain changes in existing political factors for the civil unrest to major decisions
which are taken by the government (Erasmus, B., Strydom, J.W. and Rudansky-Kloppers,
S. eds., 2016). In many of the possible cases political stability is considered of the nation
of current years. Moreover, the level of integrity of politicians take active part in the act
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of corruption which leads to legal document of high level of government workers. For
this, the present laws enforces prominent laws to business which is related towards the
contract law and for this, Micro focus international PLC is not allowed to breach it.
Moreover, company's intellectual property law is protected in terms of their policies as it
can find little bit risky to invest in Micro focus international PLC. Moreover, trade
barriers also impacts the trade partners of company as it would harm company and
prevent from the potential exports. For this, low minimum wages would impacts the
profit margin of company and increases the chances of survival of company. Economical: This factor pertains the economy of country which gets fluctuate according
to the inflation rate, foreign exchange, interest , GDP and the current phase of economic
cycle. As a result, this factor impacts the demand, investment, climate of business and so
on which makes company more profitable. In respect of this, economic system of the
currently operated sector is questioned for which the perfect competition of company gets
work which depicts the growth rate of GDP as it impacts the growing future of Micro
focus international PLC. For this, the interest rate impacts the individuals which is
willing to invest and higher rates results in great investment which leads to grow
company. Moreover, the financial market and its concerned operations is useful in raising
the capital at fair prices and also keep their mind in suitable demand and supply. In
addition to this, the exchange rate of country engages in the international trade as for this,
the stability of currency is more important because unstable currency demotivates the
international investors. Social: These factors reflects the societal conditions in which Micro focus international
PLC operates its business and also encompasses the culture, belief, values and attitude of
the community. Here, it describe the marketing aspects of company and also understand
the customers and their lifestyle and other related things which is useful in designing the
products and developing the marketing message that leads to bring success in venture.
For this, the demographics and suitable meaning regarding the age and gender is hugely
impacts as it not only for the marketing of certain product (Lee, I. ed., 2017). Moreover,
class distribution for the population is the important as in concern of this, Micro focus
international PLC is unable to develop and promote the premium of the product regarding
the people who belongs from lower class and mostly relies on the niche marketing.
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Moreover, differentiate in educational background among the marketers which target and
make things difficult to target the market in effective manner. For this, company should
be aware regarding the health standards and reactions of the harassment and also offer
importance for the environmental protection which is useful in prevailing the whole
industry. Technological: These factors rapidly take down the price structure and competitive
landscape of industry in a very short period of time as it is important for the company in
constant and consistent manner in order to innovate things for the sake of increasing
profits and also become the market leader to prevent various barriers in upcoming time.
For this, current technological developments breakthrough the competitors as it is
mentioned and encounters the new technology which is useful in gaining the popularity
in industry (Saleem, S., 2015). Technology is useful in diffusing the other companies
within the industry which leads to copy the technological features of Micro Focus
International PLC. It also impacts the cost of technology of most of companies which are
in subjective manner as it increases the potential and reduces the profitability result. As it
is huge in number and also reinvest into the research and development process in which
the future technological innovations are useful in raising the level of profit which ensures
the sustainability profits over the longer period of time. Legal: Here, the government bodies and suitable frameworks impacts the political
conditions and it also holds the political party and majorly the government body. As if
efficiently protect Micro Focus International PLC and its employees in order to retain
talented and skilled workforce. In respect of this, Micro focus international PLC opt
various laws, like intellectual property law and data protection law which is useful in
protecting the ideas and patents of company in order to determine the profit due to its
reliable information (Breckova, P., 2016). For this, if the data gets stole then company
can lose its competitive edge and also increases its chance of failure. In addition to this,
discrimination and health and safety laws are created that are witnessed in the further
conditions in which earlier times employees are forced to work in during and after the
industrial revolution. Here, the implementation regulates in expensive manner as it helps
in engaging suitable laws in an organisation.
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 Environmental: This factor holds the various standards of environment and its protection
act which become the probable norm for company and for this the aim of company is to
prevent from being targeting and gets conscious regarding the lack of environmental
conditions. Here, the present weather conditions impacts the ability of company in order
to manage the transportation to finish its products and services (Hillary, R., 2017). As it
impacts the delivery dates of final products because of unexpected monsoon. Moreover,
company also contribute in the further endangerment of various species and because of
this, a law is developed but it backlash from the public as it boycott the company is
retaliation.
CONCLUSION
Thus, it is concluded that it is important to analyse the external environment as it is useful
for company which influences the operating situations and conditions of business. Moreover, in
order to survive in the business market, companies need to adapt changes as fast as possible as it
is useful for their betterment and running the smooth business. In regard of this, prominent
structure of company is described and how it is governed. Its also describe the importance of
PESTLE analysis and also use it to determine its impact on company.
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REFERENCES
Books and Journals
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Breckova, P., 2016. Family Business in the Czech Republic.
Eling, M. and Schaper, P., 2017. Under pressure: how the business environment affects
productivity and efficiency of European life insurance companies. European Journal of
Operational Research. 258(3). pp.1082-1094.
Erasmus, B., Strydom, J. W. and Rudansky-Kloppers, S. eds., 2016. Introduction to business
management. Oxford University Press Southern Africa.
Groşanu, A., and et. al., 2015. The influence of country-level governance on business
environment and entrepreneurship: A global perspective. Amfiteatru Economic
Journal. 17(38). pp.60-75.
Hillary, R., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Lee, I. ed., 2017. The Internet of Things in the Modern Business Environment. IGI Global.
Moroni, I., Arruda, A. and Araujo, K., 2015. The design and technological innovation: how to
understand the growth of startups companies in competitive business
environment. Procedia Manufacturing. 3. pp.2199-2204.
Prajogo, D.I., 2016. The strategic fit between innovation strategies and business environment in
delivering business performance. International journal of production Economics. 171.
pp.241-249.
Saleem, S., 2015. BUSINESS ENVIRONMENT, 3/e. Pearson Education India.
Virglerova, Z., Dobes, K. and Vojtovic, S., 2016. The perception of the state's influence on its
business environment in the SMEs from Czech Republic. Administratie si Management
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