Business Environment Analysis and Impact on NEXT Organisation

This report provides a comprehensive analysis of the business environment, focusing on NEXT, a British multinational clothing and home products retailer. It begins with an introduction to the concept of the business environment, emphasizing the impact of internal and external factors on organizational procedures. The report then delves into the structure, size, and scope of different organizations, linking them to business objectives. It examines the interrelationships between various organizational functions within NEXT, such as research and development, sales and marketing, production, human resources, finance, and manufacturing, along with the advantages and disadvantages of these interrelationships. A critical analysis of the complexities within different business functions is also included. Furthermore, the report explores the positive and negative impacts of macro environmental factors, including political, economic, social, technological, environmental, and legal factors, on business operations. A PESTLE model is employed to support a detailed analysis of the macro environment, followed by a critical evaluation of how these environmental factors influence business objectives and decision-making processes within NEXT. The report aims to provide a thorough understanding of the external and internal factors influencing NEXT's performance and strategic planning.

Business Environment

INTRODUCTION
Business environment is a specific term that used to analyse impact of internal and
external factors on business procedures. This is basically operate continuous changes to provides
various opportunities to a business organisation. These kind of environment influence business
procedures and get affected by organisational activities. It is basically collection of different
entities and factors that may or may not be under the control of business. These type of factors
directly affect profitability, productivity and growth of organisation. These kind of factors can
make drastic changes in organisational operational and functional activities. For this,
management of organisation needs make effective and appropriate strategy to manage impact of
environmental changes easily (Fernando, 2011). This project report is based on NEXT which is a
British multinational clothing and home products retailer chain. This organisation was founded
in the year of 1864 by Joseph Hepworth. Next has around 700 stores in which 500 stores are
located in UK or 200 are in Europe and Asia. This organisation basically deals in branding
clothing, footwear and home products. This report is discussing about purpose of different types
of organisations and scope and size of different rage of firm. It is also discussion about micro and
macro environmental factors that influence in decision making procedure of firm.
TASK 1
(Covered in PPT)
M1 How the structure, size and scope of different organisations link to the business objectives
Each and every organisation in a economy is established to achieve their target objective
and goals in appropriate manner. These kind of firms are provide their effective services to
people (Hamilton and Webster, 2015). This activities of firm are based on their target objective
and goals. For this each and every organisation make their own structure to build effectiveness
on their business activities. In a economy, Public, private and voluntary sector organisations
provide own contribution to achieve their own target easily. Size and scope of these firm are very
different to each other. Structure and size of organisation is determine number of employees,
existing resources and funds that are used to accomplish to target objectives and goals. Scope of
firm is based on appropriate area on which organisation provide their services and products to
accomplish their future goals.
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TASK 2
P3 Relationship between different organisational function
For a Next, it is require to understand values of organisational activities that can affect its
decision making procedure. NEXT is a British multinational clothing and home products retailer
chain. They provide effective and appropriate services in around 700 stores in worldwide. For
them it is require to work properly according to organisational structure and operational
activities. Main objective of this organisation is to provide higher satisfaction to customers as per
their products and services. These kind of activities require appropriate structure as -
Research and development – For a business organisation, it is require to analyse each
and every factors relate to market activities (Klapper Lewin and Delgado, 2011). In this process,
research and development division provide their own contribution to analyse market
segmentation and customers demand. Main objective of this division is to analyse each and every
aspect tat relate to marketing approaches. Through this organisation easily analyse about
customers taste and their requirement toward firm.
Sales and Marketing – This department of organisation is work to implementation in
business procedure to getting appropriate outcomes easily. Main objective of this department is
to spread awareness about organisational product and services in target market or in front of
customers. Through this they are easily increase sale and profitability of firm. These activities
are very important for NEXT to introduce their new services in target market.
Production – This department of firm is work to implement appropriate changes in
organisation and production services of firm. Through this they can easily make effective
changes in market and build their effective image in target market. These kind of changes are
based on customer's demand and market requirement toward organisational services. After
analysing each and every element, it is require to make quality changes in organisational
production and manufacturing procedure.
Human resource – This department of firm works to provide their effective services in
each and every activity of firm. Main objective of this department is to hire skilled and
experienced candidate in firm who provide their effective services to achieve organisational
objective easily. In this procedure, human resource manager analyse each and every activity
related to firm to provide them effectiveness through this own services. For this they conduct
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training session to enhance interpersonal skills and working capacity of their employees to
getting desired outcomes easily (Osterwalder and Pigneur, 2010).
Finance – This department of organisation is working to provide appropriate funds and
reserve to implement effective changes as per customers demand. This department manage all
income and expense statement of firm to build suitable balance between them. These kind of
activities required skilled and experienced candidate who provide appropriate advise to make
effective investment at right place. This division is a lot appropriate funds to grab several
opportunities easily (Scheer, 2012).
Manufacturing department – This department of organisation is helps to manufacturing
quality changes as per social and economic factors. These kind of activities require appropriate
changes and alteration in organisational approaches as per market demand. In this process NEXT
make effective changes in their existing products or introduce new services for their customers to
provide them higher satisfaction easily. In this, it is require to make effective changes that aid to
rebuild quality image and goodwill of organisation in target market.
M2 Advantages and disadvantages of interrelationships between organisational functions
For a business organisation, it is require to make effective changes according to marker
and customers demand. In this process, each and every division of organisation provide their
contribution to achieve business objectives in appropriate manner. Main advantages of this
process is the through this organisation can easily analyse market segmentation to provide
quality products and services as per customer's demand and requirement. Disadvantages of this
process if that organisation needs to follow each and every step as per organisational structure to
getting appropriate success easily. These kind of functions are interrelated to each other in
specific manner (Shigang, 2010).
D1 Critical analysis of complexities and interrelationships of different types of business function
As per the words of Aterido, Hallward and Pagés, (2011) for different organisation it is
require to make effective strategy to achieve organisational goals and objective in appropriate
manner. For them, it is require to reduce complexities in different type of business. For this
management of firm needs to make appropriate alteration as per organisation and customer's
demand. Next is a well known firm and for them it is require that employees of company
understand their role and responsibility to work properly for achieve organisation's goals and
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objective easily. Improper coordination between employees build complexities in business
functions and approaches.
TASK 3
P4 Positive and negative impact of macro environmental factors
For a business organisation, it is require to analyse impact of internal and external
environmental factors. Macro environmental factors has influence decision making procedure of
an organisation. These external elements are beyond the control and affect performance as well
as profitability of firm. These kind of elements are directly impacting on organisational
performance, so for this management of NEXT require to make effective plan and strategy to
minimise its impact and control them easily. For this process, NEXT needs to analyse each and
every factors in appropriate manner as -
Political factors – For a business organisation, it is require to implement government policies
and norms in organisational procedure to extend their business structure in several countries.
This process is based on influence of government and political factors in organisational
activities.
 Positive Impact – For a business organisation, it is require to make effective strategy for
political factors because these aid to expend firm's structure in several countries easily.
 Negative impact – These factors influence in decision making process of firm. For this
firm needs to analyse its impact to make effective strategy for this easily. For NEXT, it is
require to make appropriate strategy to control its impact on organisational procedure.
Economic factors – These factors are related to economic values of a country that are require to
make effectiveness. For NEXT, it is require to make effective changes in their organisational
approaches to provide appropriate growth in economy (Bryman and Bell, 2015).
 Positive Impact – Economic factors helps to provide desired outcomes to an
organisation , if firm implement appropriate procedure in their business approaches.
 Negative impact – Inflation is a negative factor that directly impact on organisational
approaches. These factors are affected when income of organisation is less then expenses.
Social factors – For NEXT, it is require to make appropriate research on market to analyse each
and every factor related to customer's demand and need. NEXT needs to analyse various changes
in economy and social factors that affected through customers choice, fashion and trends as well.
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 Positive Impact – for NEXT, it is require to make appropriate changes according to social
changes because through this they can easily make effective changes in their business
procedure.
 Negative impact – If organisation not make effective alteration in their business
approaches then these factors can directly impacting on customers demand and
organisation's sales (Carroll and Shabana, 2010).
Technological factors – For a business organisation, its is require to make effective changes in
their organisational activities as per technological changes. For this, NEXT needs to implement
advance feature and innovative idea to garbing effective strategy in organisational approaches.
 Positive Impact – Advance technology always help to provide effectiveness in business
approaches. Through this firm can easily make appropriate changes and reduce wastages
and time to serve quality services to customer as per their demand or need.
 Negative impact – Advance technology always require experienced and skilled candidate
who understand how to implement its feature in organisational approaches other wise
these factors affect negatively on organisational approaches.
Environmental factors – These factors are related to environmental elements that affect
products and service procedure of firm directly. For this organisation needs to make effective
changes in their organisation that are in the demand influence by environmental activities.
 Positive Impact – For this organisation can easily serve quality services to their
customers as per environmental changes to fulfil their needs easily. Through this they
easily get higher benefits and desired outcomes.
 Negative impact – Ineffective changes in organisational activities can negatively impact
on selling process of firm (Charter, 2017).
Legal factors – For a business, it is require to implement legal aspects in their business process
to develop positive environment in firm easily.
 Positive Impact – By legitimating legality in organisation, firm can easily expend their
business structure in several countries.
 Negative impact – NEXT needs to follow these term to implement effectiveness in
organisational structure otherwise firm can not get long term benefits easily.
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M3 PESTLE model to support a detailed analysis of the macro environment
For a business organisation it is require to make appropriate analysis on macro
environmental factors. These kind of factors influence in decision making process of firm, So for
this management of organisation needs to make impactful strategy to minimise its negative
impact on decision making process of firm. In this process organisation needs to analyse
different environmental factors as Political, Economic, Social, Technological, Environmental
and legal factors that can directly affect on organisational activities. These factors influence for
majors alteration is organisation services. These factors are beyond the control of employees.
D2 Critically evaluate the impacts of environmental factors have upon business objectives and
decision-making
According to Chesbrough, (2010) in a business organisation, it is require to analyse
impact of internal and external environment on decision making process of firm. So for them
firm needs to analyse each and every aspect to make effective and impactful strategy for this.
Internal factors are controllable, so for them management can easily make effective plan to
control them easily. But external factors are beyond the control, so for them management needs
to make appropriate analyse to reduce its impact upon business objectives and decision-making
procedure. Internal environmental factors can be customers and employees of firm who manage
operational and functional activities of firm. These factors can influence decision making
procedure of organisation. As external environment factors can be legal issues, social factors and
impact of environmental element on business activities and performance as well.
TASK 4
P5 Conduct internal and external analysis
For a business organisation, it is require to analyse internal and external analysis to make
impactful strategy for this. NEXT is a British multinational clothing and home products retailer
chain which was basically deals in branding clothing, footwear and home products. For them it is
require to analyse market and customers demand to provide them quality products. In this
process NEXT needs to make internal analysis through SWOT ass -
Strength Weaknesses
 This organisation apply powerful
philosophy to design new and creative
 NEXT provide quality products to their
customer's at a high cost, so it is hard
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products that capture customer's eyes
easily.
 For introducing new products and
services, NEXT uses effective
advertising and marketing tools.
for everyone to afford its cost easily.
 This organisation is basically deals in
formal wears so it is hard to get average
and casual wear cloth of this brand.
Opportunities Threats
 This organisation uses internet
marketing to provide their services to
international customers. Through this
they can get long term benefits easily.
 NEXT expend their business structure
in new countries, so these kind of
changes provide then effective strategy
t to build effective relation with new
customers.
 This organisation has various strong
rivalries as Mark and Spencer.
 Target market of organisation reduce its
structure continuously (Commander
and Svejnar, 2011).
P6 How strength and weaknesses are interrelated with external factors
For NEXT, it is require to analyse strength and weaknesses that are interrelated with
external environmental factors. Through this they can easily make strong strategy to reduce its
negative impact and implement positivity in working procedure. NEXT needs to analyse their
strength and weaknesses to identify its impact as -
 Political and legal factors – Next expend its business structure in several countries, so
for them it is require to implement political and legal values in their business structure to
make effective changes easily. These kind of factors can impact negatively on business
structure and activities.
 Economic and social factors – For NEXT, it is require to analyse each and every factor
related to economic and social activities. In this they can easily adopt customers demand
and need to manufacture quality products according to this. Through this they can easily
create long term relation with customers. These kind of activities provide them effective
strength to get long term benefits easily.
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 Technological factors – For NEXT its is require to make appropriate changes in their
business activities as per technological advancement. Through this they can easily build
higher growth and productivity (Craig and Campbell, 2012). Innovative ideas always
helps to introduce new services in market that aid to capture customer's eyes toward
organisational services. These kind of feature and changes provide effectiveness to
getting higher growth easily.
M4 SWOT analysis and justify how they influence decision-making for the chosen organisation
For a business organisation, it is require to make appropriate analysis on internal factors
of firm. These factors can easily examine through SWOT analyse to getting appropriate
analysis on organisations strength, weakness to make effective changes easily. Through this firm
can easily various opportunities to getting higher growth easily (Dahan, 2010). For NEXT, it is
require to analyse threats to make effective decision to reduce its impact on organisational
activities. These kind of factors are influence decision-making for the organisational activities.
Employees of NEXT needs to take appropriate decision for weakness and threats of firm. SWOT
analysis of an organisation assist to make proper decision for operational and functional business
approaches. These factors can be firm's strength and weaknesses that influence decision making
procedure of an organisation.
CONCLUSION
As per the above report it has been determine that business environment is a most
important factors that affect decision making procedure of organisation. For this organisation
needs to analyse each and every factors to make effective or impactful strategy for this. This
project report is based on NEXT which is a British multinational clothing and home products
retailer chain. This organisation was founded in the year of 1864 by Joseph Hepworth. This
project representing purpose of different types of organisations and scope and size of different
rage of firm as well as impact of micro and macro environmental factors that influence in
decision making procedure of firm.
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