Business and Business Environment: An Analysis of M&S

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[BUSINESS AND BUSINESS ENVIRONMENT]

Contents
INTRODUCTION............................................................................................................................. 2
LO1.................................................................................................................................................3
P1 EXPLAIN DIFFERENT TYPES OF BUSINESS ORGANIZATIONS..................................................3
P2 EXPLAIN DIFFERENT TYPES OF ORGANIZATION WITH RESPECT TO SIZE AND SCOPE...........4
LO2.................................................................................................................................................5
P3 IDENTIFY THE RELATIONSHIP BETWEEN DIFFERENT ORGANIZATIONAL FUNCTION AND
ESTABLISH THEIR LINK WITH ORGANIZATIONAL OBJECTIVES AND STRUCTURES......................5
LO3.................................................................................................................................................9
LO4............................................................................................................................................... 10
P5 CONDUCT INTERNAL AND EXTERNAL ANALYSIS OF M&S IN ORDER TO IDENTIFY STRENTH
AND WEAKNESS OF THE ORGANIZATION................................................................................10
P6 EXPLAIN HOW STRENGTH AND WEAKNESS ARE RELATED WITH EXTERNAL MACRO
FACTORS.................................................................................................................................. 13
CONCLUSION............................................................................................................................... 14
REFERENCES.................................................................................................................................15

INTRODUCTION
A business environment is a set of internal and external factors and influences the
environment of the organization in which it operates. This is a critical aspect of any business
that needs to be understood for the overall success and growth of the company in the
industry. The purpose of this report is to highlight the importance of business environment
along with focusing on its positive and negative aspects (Magretta, 2011).
The report provides deep insight into different types of business organization. It provides
knowledge to deal with the dynamic changes in the external environment. For the purpose of
this study, we consider three organizations; NHS, M&S and The National Trust being as public,
private and voluntary sector.

LO1
P1 EXPLAIN DIFFERENT TYPES OF BUSINESS ORGANIZATIONS
There are mainly three types of organization that are classified as public, private and voluntary
sectors. It is important to discuss the size and scope of different types of business
organization.
Public sector
A public sector consists of a wholly government-owned organization that offers the best
quality goods and services so as to serve the society in an effective manner. It generally
consists of schools and other public sector undertakings that receive funding from the
government for the effective running of the business (Jackson, 2012).
For example- NHS is the largest public sector organization across the UK that provides health
and social care services to the local citizens. The base of this trust lies in providing the best
quality care treatment at affordable costs.
Private sector
These are the organizations that are run by individuals for the purpose of earning profits. It
can be in the form of sole trader, partnership and other private organization. They frame
strategic policies for the purpose of attracting prospective customer in the market (Lowe et al.,
2012).
For example- M&S is the multinational British organization in London that deals in selling
clothes and home products to the citizens of the UK. The group employs over more than
80,000 employees and generated annual revenue of £1.1billion by the end of March 2018.
Voluntary sector
A voluntary sector consists of organizations in the form of charitable trust and institution that
work for the social cause of the welfare of society. The main purpose of such an organization is
to provide benefit to the member and society.
For example- The National Trust is one of the biggest voluntary
sectors in the UK. The main purpose of the trust is to provide
care to the historic monuments in the UK and enrich the serene
beauty so as to build the countryside (Jackson, 2012).

P2 EXPLAIN DIFFERENT TYPES OF ORGANIZATION WITH RESPECT TO SIZE AND SCOPE
Each organization differs in terms of size, scope and structure. Organizational size is defined
according to the number of workers employed by the organization. It also depends on revenue
generating the capacity of the organization. Organizational scope and structure defines the
roles and responsibilities of each individual and provides a better way to achieve a shared
goal.
PUBLIC ORGANIZATION (NHS Trust)
There are more than 1.7 million workers working along with NHS Trust to provide proper care
and treatment to the citizens of England. The main focus of the group is to diagnose all the
disease suffered by UK citizens by providing proper care and treatment. The annual operating
cost of the Trust is around 100 £ billion.
PRIVATE ORGANIZATION (M & S)
M&S (Mark and Spencer) is a British multinational company that operates around 1500 stores
in the local and international markets. The annual revenue of the company is around £10.7
billion along with employees over 80,787 employees by the end of March 2018 (Mora, 2016).
VOLUNTARY ORGANIZATION (The National Trust)
The scope of the National trust lies in expanding the business by taking care of historic
monuments and places. The organization is spread over 775miles and by taking into considers
the service of 10,000 staff members. The trust also introduces welfare schemes and measures
without any purpose of earning profits (Hillary, 2017).

LO2
P3 IDENTIFY THE RELATIONSHIP BETWEEN DIFFERENT ORGANIZATIONAL FUNCTION
AND ESTABLISH THEIR LINK WITH ORGANIZATIONAL OBJECTIVES AND STRUCTURES
The interrelationship that exists between different functions of the organization plays a vital
role in the development and growth of the organization. M&S gives proper importance to
interrelationship and thereby follows proper strategies and tactics for the purpose of
improving the departmental relationship (Mora, 2016).
Marketing
The marketing department plays a crucial role in developing marketing strategies and tactics
for increasing the sales and revenue of M&S. The department is responsible to enrich the
existing marketing opportunities by identifying the needs and wants of the consumer (Ferrell
and Fraedrich, 2015).
Human Resource
Human resource is the most important asset of M&S. the department is responsible to ensure
proper training and development programs so as to enrich the potential talent of the
employees (Harrison, 2013).
Information Technology
This department plays an essential role at M&S in order to incorporate updated technology
across the various stores. This will further enhance customer services and level of satisfaction.
Finance
Finance is the lifeblood of the business that establishes a link with all other departments of an
organization. The department is responsible to look out at the financial feasibility of the
company and take care of all the valuable assets at M&S (Mills & Smith, 2011).
Customer service

The main purpose of this department is to help the customer to redress their queries and
problems. Also, M&S stores various online facilities to customers for easy access and
availability.
An organizational structure with respect to NHS
Figure: Structural working of NHS
[Source: Harrison, 2013]
NHS is an independent body that receives funding from the government. This is a public sector
organization that aims to improvise the health and social care system across the UK. It also
frames strategic policies for the purpose of incorporating quality controls in the working
process of NHS (Pearson, 2017).

The organizational structure of M&S
Marks & Spencer follow a flat organizational structure with a limited level of management
between the front line employees and administrative level. This type of structural support
decision making in a quick manner. Henceforth, it also allows problem solving and rapid
change across the organization (Magretta, 2011).

Structural working process of The National Trust
The National Trust is charitable conservation in the UK that aims to protect the historic
buildings and landscape. The trust has more than 5 million members and runs their business
activities through subscription fees received from such members (Rizq, 2011).

LO3
Slide 1

Slide 2