Report on Organisation Types, Size, and Macro Environment Impact

This report provides a comprehensive analysis of different types of organisations, including public, private, and voluntary, focusing on their size, scope, and legal structures, with examples such as BBC, Tesco, and Oxfam. It explores the interrelationship between various functions within an organisation like Tesco, such as human resources, finance, marketing, and IT, highlighting the importance of functional and matrix structures. The report also examines the impact of the macro environment on business decision-making using PESTEL analysis, discussing political, economic, social, and technological factors affecting organisations. Finally, it includes a SWOT analysis to determine the competitive positioning and resources of a business, along with its strengths and weaknesses. This assignment solution is available on Desklib, a platform offering study tools and resources for students.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
P1 Different types of organisation..............................................................................................1
P2 Size and scope of types of organisation.................................................................................3
P3 Explain the relationship between functions of an organisation.............................................4
P4 Impact of macro environment on business............................................................................5
P5 Internal analysis.....................................................................................................................7
P6 Strength and weakness of macro environment......................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment is a sum of internal and external factors and these factors affect the
company directly or indirectly(Berg and Ostry, 2017). It is a broader term that consist of several
elements such as competition, level of employment, customers, suppliers and so on and the main
motive of firm is to accomplish complete the goal in a limited time frame. Tesco is renowned
brand in UK which deals with wide range of items such as groceries, home appliances and
financial matters. Its aim is to deliver excellent services to meet the demand of customers.
The report cover types, size and scope of business enterprise and interrelation between
various departments. The impact of macro environment on decision making play the important
role in a competitive era. The report also includes interrelationships between various functions of
an organisation. Also, it includes SWOT analysis of specific organisation which determine the
level of competition and productivity of a firm. The report comprises of strength and weakness
that have a major cause on capability and determining the resources of a business.
P1 Various kinds of organisation
Organisation is an entity that consist of people or group in order to achieve the well
defined goals(Broséus and et. al., 2016). The manager is responsible for conducting various
activities so that task are achieved in a proper time and work is divided according to their
specialised skills. There are various types of organisation that is presented below underneath:
Public organisation:These are managed and operated by government as they provide
goods and services for the welfare of public(Cooper and Marshall, 2018). Public organisation
raise money through direct and indirect taxes collected from individuals. They have large amount
of financial resources which is used for the benefit of the community. BBC is considered as the
best example of public limited company.
Purpose: The main motive of public limited company is to maximize the wealth of
shareholder value. The firm put their emphasise on corporate social responsibility and its focus is
to expand the business operations in different parts of country to generate sales.
Legal structure:
Local government: It is the authority that control their management and operation in a
particular district of a country.
1

State government: This government share political autonomy and is responsible for
creating state legislation.
Central government: It has one cabinet that is ruled by the prime minister of the country
and its role is to protect the right of citizens.
Private organisation: These are owned and managed by ownership or private
individuals and their purpose is to make huge profit(Coppin, 2017). The benefit of private
organisation is that it render best infrastructure amenities and best services to its customers.
Tesco is one of the popular company that provide wide range of services to its customers.
Purpose: Private sector organisation is formed by newly formed enterprise with the aim
of making more money and provide good quality services in order to gain competitive
advantage.
Legal structure:
Partnership: It is formed by two or more companies who are agree to share profits and
loss of business to accomplish goal.
Sole Proprietorship: It is the owner or individuals who control their business themselves
and takes decision on their own.
Limited Company: A company is a legal entity having perpetual succession and
common seal carrying limited liability.
Voluntary organisation: This means non profit organisation which is defined by union
or group of individuals who work together to achieve common goal.(Macdonald and et al.,2018).
Their role is to fulfil the need of individuals either by themselves or through government. Oxfam
is charitable institutions in UK.
Purpose: the main motive of voluntary organisation is to provide assistance rather with
the motive of earning profit through trust or charitable institutions.
Legal structure:
Trust: It is defined as confidence and hope that things would be better in future.
Unincorporated association: It is a group of people who work together to achieve
common goal other than making profit.
2

P2 Size and scope of types of organisation
There are various types of organisation such as public, private and voluntary association.
Every entity have different size and scope and it provide a structure of obligations and
responsibilities which is assigned according to their skills.
BBC (Public):
It is the oldest broadcasting channel in UK that provide their services in radio, TV and
online in 28 languages.
Size: It is the largest broadcasting company with 22,401 employees and and its net
income is 69 million and its total asset is 1.172 billion.
Scope: Currently, it is operating in 200 countries and planning to expand their operations
worldwide.
Vision: The vision is to provide new and innovative technology in an around the world.
Mission: It is the largest broadcasting channel and to inform and educate people about
the current happenings around the world.
Objectives: The objectives is to deliver quality and valuable services to win the hearts of
customers.
Legal Structure: BBC is controlled by central government that handle all complexities
related to state and local authorities.
Tesco (Private):
It is renowned retail industry in UK that provide wide range of services like groceries,
home appliances, clothing and financial services and so on.
Size: Tesco is one of the reputed brand with 4,50,000 employees and its net income is
1,320 million.
Scope: The concerned has expanded its operations outside the UK to 11 countries. It
scope is wider as the company face major challenge when it enters the US.
Vision: The vision is to be the most highly valued business and serve the loyal customer
in the most efficient manner.
Mission: With full of creative ideas, the mission is to be spread each and every corner of
the country.
Objectives: the aim of respective firm is to provide excellent quality of goods and
services to meet the needs of the customer.
3

Legal Structure: It's legal structure is corporate governance and to make sure that the
firm is achieving the strategies in according to shareholders.
Oxfam:
It is the independent charitable institution that help people directly facing the issues of
poverty and injustice. It is the local committee that is formed in support of Famine Relief
Committee.
Size:The concerned firm employs 5300 people around the world and have more than
22,000 employees.
Scope: The scope is broader as it cover large market segment in Australia, Canada,
France, Germany, Hong Kong and develop the strategies to combat famine.
Vision:The vision is to help poor people and remove the poverty and to promote right to
equality.
Mission:The mission of Oxfam is to provide lasting solutions and and to empower
people to create a safe and secure future.
Objectives:The aim of firm is to shape the culture by values and to provide sustainability
and inclusiveness in the institution and also to bring positive change in the lives of people.
Legal Structure: Oxfam form the association of Council of Trustees and they are
responsible for charity and its activities.
P3 Explain the relationship between functions of an organisation
There is interrelationship between various departments in Tesco s it is one of the leading
firm which provide wide range of services(Henderson and Scott, 2018). Each perform different
functions in an organisation like finance, marketing and so on. There types of organisation
structure are functional, divisional and so on which are given below:
Functional structure: It consist of various departments such as marketing, sales and
production that divide the work among the subordinates in according to their skills and talent and
facilitate proper coordination in a workplace.
Divisional structure: In this type of organisation structure, the work is divided among the
small organisations so that it leads to completion of task within a specified period of time.
Matrix structure: it contain the combination of divisional and functional structure as each
company consist of dual departments such as functional manager and dual manager.
4

It can be summarised that the manager of Tesco follows the Matrix structure to facilitate
proper coordination and communication among the different departments.
Interrelation between departments are presented as follows:
Human Resource and financing: The HR manager of Tesco recruit and choose the right
person according to their specialised skills and provide training and development of an employee
to improve the skills and knowledge base of an employee. The finance department of Tesco keep
record of all business transactions and determine the positive cash flows and also to make sure to
pay timely debts and bills.
Marketing and Information Technology: Today, IT in Tesco provide an ease of
convenience to customers by providing good communication facilities and through introduction
of online shopping(Reis and et al., 2018). The concerned firm uses advertisement campaigns to
create an awareness of variety of products to satisfy the needs of customers. The price and
promotion strategy is set appropriately by the companies to gain large exposure within the
market.
Organisation structure
The structure of organisation determine the information flow within the company and it
includes the activities that define the rules, regulations and duties performed to achieve the goals
of an organisation(Molinos-Senante and Maziotis, 2017). Tesco follows the functional structure
because it focuses on the functions of different departments. Using the right hierarchical
structure in the organisation ensure success in business. Everyone in the organisation is assigned
their role and responsibilities to facilitate smooth operation of a business. In other words, the
manager of Tesco divide the work among the subordinates that help in achieving their goals
efficiently. The CEO of company takes all major decisions and represent the company as a
whole. There is mediator between the board of directors and low level managers that includes
marketing and personal relations. At last, there is store manager who is responsible of their own
store and they run day to day operations as they have direct contact with customers.
P4 Impact of macro environment on business
Macro environment is defined as the aggregate of whole economy that includes various
aspects such as competition, per capita income,inflation, fiscal policy and many more(Nowacki,
and Willits, 2018). It provide the overall growth of the economy that have major impact on
5

decision making of the company. The manager of Tesco has applied PESTEL analysis to
determine the positioning within the market. The same is presented as follows:
Political elements: This factor encompasses elements such as government policy, foreign
trade, corruption and various labour laws.
Positive impact: UK is a multi party system that consist of two parties such as
conservative party and labour party. The political condition is the major strength of UK(Tellier,
and Tosser, 2016). Tesco has expanded its operations in different parts of the country as it is well
known retailing industry that capture 30% market share in UK.
Negative impact: The withdrawal of UK from European country namely, Brexit has
adverse the political conditions in UK that results in increasing the prices of products. Thus, this
leads to decreasing the profits of a company.
Economical elements: This includes elements such as interest rates, exchange rates,
disposable income and so on(Thomson, 2018).
Positive impact: UK is the 5th largest country in the world. Tesco can make use of
infrastructure and technological development in UK to provide superior services.
Negative impact: The vote for Brexit in UK has adversely affected the economic
conditions that results in decrease in employment opportunities. This combat the growth of
Tesco.
Social Elements: This aspect includes cultural barriers, population growth, lifestyle and
health and safety consciousness of people(Sung and Yih, 2016).
Positive impact: In a dynamic environment, there are changes in customer trends and
market demands as there is shift in preference towards bulk shopping and one stop shopping.
Today, customer are diet conscious and also Tesco is adapting changes itself by accommodating
demand of organic products.
Negative impact: With reference to Tesco, there is continuous changes in demand of
goods and services which become difficult for a fixrm to adapt changes quickly.
Technological elements: This elements includes automation, level of innovation and
research and development activity.
Positive impact: UK is one of the advanced technologically country in the world. Tesco
provide unique and innovative services to meet the demands of customers.
6

Negative impact: Tesco invest large sum of money in technological development and
because of its obsolescence which possess the threat for a company.
Environmental factors: this encompasses various factors such as climate and weather
change and various environmental policies.
Positive impact: Tesco provide benefit to society by reducing its carbon footprint by 50%
in order to achieve the long term objectives.
Negative impact: The concerned firm is using plastic polythene's for providing goods and
services that possess a serious threat to environmental concerns.
Legal factors: This encompasses includes discrimination laws, consumer protection laws,
anti trust laws and many more(Oyewobi and et. al., 2016).
Positive impact: Tesco abide the rules and regulations which help the firm to gain
reputation and image in the market. This provide large exposure to a firm end enjoy the greater
economy of scale.
Negative impact: There is change in government policies which create a major impact on
the performance of Tesco. Also, Brexit has adversely affected the legal conditions in UK.
P5 Internal analysis
The internal analysis help the firm in determining the strength and overcoming the
weakness by grabbing the opportunities and combatting the threats of firm. Swot analysis is a
business management tool that determine the positive and negative of an industry. It help the
firm to assess the resources in order to gain sustainable competitive advantage(Murphy, 2019).
Below the SWOT analysis of Tesco and ASDA is given below:
SWOT of Tesco:
Strength Weakness
 Tesco is one of the leading retailer in
UK that operates in a number of
countries such as China, Poland,
Ireland and so on.
 The concerned firm provide the facility
 One of the major weakness is that
Tesco has not expanded their
operations in countries like Japan and
USA.
 The firm avoids prosecution that
7

of online shopping and provide service
to the millions of customers.
 The respective firm uses advertising
campaigns to capture large market
share and satisfy the needs of
customers.
possess a negative image on the firm.
Opportunities Threats
 With reference to Tesco, Strategic
alliance with other company is the
opportunity as it help to attract large
number of customers within the market.
 The firm has decided to introduce
Jack's in the discount market which
provide various growth opportunities.
 The entry of competitors in retailing
industry possesses a major threat for
Tesco.
 The entry of major competitors like
Sainsbury ans ASDA create the major
threat for the company.
Swot analysis of ASDA:
Strength Weakness
 ASDA is well known brand that
provide innovative products to its
customers.
 The concerned firm is third largest
retailer in UK that enjoys greater
economy of scale.
 The firm provide loyalty scheme to its
customers to gain large access of
customers.
 The concerned firm has not occupy the
leading position in the market as
compared to those of similar brands
such as Sainsbury.
 One of the major weakness is that
company is criticised due to the reason
of misleading advertising campaigns.
Opportunities Threats
 Today, ASDA has introduce the facility
of online shopping to capture large
 ASDA faced the large number of
competitors in UK and its major
8

market share.
 The concerned firm can grow by
takeover of small firms in order to gain
large exposure across the globe.
competitors are Sainsbury, Aldi and so
on.
 Also, growth of various independent
retailers in UK possess a big threat for
the company.
P6 Strength and weakness of macro environment
PESTEL analysis is a tool that help the firm to identify external factors of a business.
Organisation continuous evaluate the changes to create a competitive advantage in the market
that provide future growth opportunities to a business(Niemi, and Pekkola, 2017). The PEST of
Tesco is described as follows:
basis Strength Weakness
Political Tesco is one of the leading
retailing industry in UK and it
has capture large market share
with introduction of online
shopping to create large
customer base. UK has the
major political strength that
provide long term
sustainability and peace all
over the country.
The concerned firm has large
number of competitors which
is one of the major weakness
of a firm. Due to Brexit, it
caused large number of
uncertainties and chaos all
over the country.
Economic Tesco provide excellent
quality goods and services to
meet the demands of
customers. The respective firm
could make use of
infrastructure development to
deliver best services to their
Due to vote for Brexit, the
concerned firm results in
reduction of employment
opportunities that leads to
increase in prices of products.
This decline the growth of
Tesco and thus reduce the
9

clients. profit margin.
Social Tesco is well known brand that
provide large number of non
food items to gain customer
satisfaction.
The use of polythene bags
cause a serious concern
towards environmental issues.
Technological Tesco provide unique and
innovative products and uses
advanced technology to
promote economic growth and
deliver fast and efficient
services to their clients.
One of the major weakness is
that the respective firm hire an
expert to train subordinates
that increases the cost of a
company. Tesco makes invest
large investment in technology
and thus due to its
obsolescence, it become major
threat.
CONCLUSION
From the above information, it can be concluded that the business environment in which
company carry out its operation is regarded as dynamic. Macro environment consist of both
intrinsic and extrinsic factors that play a major role in a economy that ensures growth of a
business. The manager perform various functions such as planning, organising, controlling and
monitoring the activities to achieve the goals effectively and efficiently.
10