Business Environment Analysis: Tesco's Operations and Strategies

This report provides a comprehensive analysis of the business environment, focusing on Tesco as a case study. It examines various organizational types, their aims, and sizes, including profit, non-profit, public, private, and voluntary sectors, with a detailed look at Tesco's stakeholder objectives. The...Read More

BUSINESS AND THE BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1) Various kind of organisation which aims and purpose are different...............................1
P2) Size and scope of various kind of organisation...............................................................3
TASK 2............................................................................................................................................4
P3) Critically analysis the interrelationship of various business functions............................4
TASK 3............................................................................................................................................7
P4) Critically analysis of macro-environment using PESTLE model....................................7
TASK 4............................................................................................................................................8
P5) Examine internal and external factor which affect the organisational profit and
productivity.............................................................................................................................8
P6) Evaluate the internal and external strength of organisation.............................................9
CONCLUSION..............................................................................................................................11
REFERENCE.................................................................................................................................12

INTRODUCTION
Business environment is defined as the techniques which is applied in organisation to
analyse the business condition and which help to determine the company. Create the advantage
in competitive business profits. In this topic include, which have various internal and external
threats which is a kind of factor affect the business operation. Business factor are must observe
in a such a way because a time while when things are going unconditional if the factor are known
then the solution and operational plan are taken. In 1899, a report is initiated that about Tesco
which is a profitable and largest supermarket chain in UK. They have very large number of retail
store and shop and wide range of product and services to customer. The documentation consist
about the various kind of enterprise which is on size and shape with scope, function of
organisation they are interrelated to meeting interaction well it is analysed internal and external
factor which affect the by internal and external factor which helps to get a proper knowledge
about the PESTLE, porters five forces and also by swot analysis and twos matrix. Where the
pestle analysis is a consideration of factor which is affected the organisation and porter five
forces help to give the vision about the competition and powers of buyers and supplier
(Mahmood and et. Al., 2017). Also SWOT analysis provide the brief about the strength,
weakness and other term which is help in observation of organisation.
TASK 1
P1) Various kind of organisation which aims and purpose are different
Organisational profit: Profit organisation which aims and indicate these organisation
which they are focused in customer order to give high quality of product and services. It include
such as various company which come under as margin which is created by the profit organisation
which are restaurant, insurance, shop of retails and many others. The main aim to get a
motivation by the increase sale promotion and help to hold the market share at different
marketplace(Rezaee, Z., 2016). Its also help in the various legal firms like corporation,
partnership and other delegating task.
Tesco: Tesco is a super retail market in UK. Where main theme is to earn maximum
profit. They are producing wide range of goods and service to consumer and they are second
largest retail store in UK. They have also a chain market in which are surrounding in country.
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Which establish the higher profit. The main of tesco is to provide the good quality of product and
service to their customer and maintain their standard of living (Taneja and et. al., 2016).
Tesco stakeholders: the detailed analysis of stakeholder of tesco have some objective
which helps to explain about the internal and external stakeholder. It aim to explore their
promotion of company. The stakeholder of tesco are manger, board of director and excellence
department committee, where the selected firm consist of chairman, chief executive, chief
financial officer and number of non executive director of board which is help in organisation to
promote and grow.
Non profit organisation: these type of enterprise are used to establish for those who
providing service to the various community. These enterprise are corporates with many of
organisation and these type of organisation are just muted under in the cat of producing good and
services to customer (Schell and et al., 2020). The group of people and their main objective to
promote the culture and professional and social purpose.
British heart foundation: the British heart foundation is a charity based organisation in
united kingdom. It funds research is to majorly for those who is facing problem regarding the
circulatory disease and also aware camp to make the management of heart on base of their risk
factor. This foundation is established in 1961 by a group of medical team who were concern
about the death due to the heath issue which is generally arises by the cardiovascular disease.
Non governance organisation: the non governance firm are generally belief in the
society creating and their earning criteria is zero. Their main aim to serve the society. And they
are not registered by the government bodies.
Private sector: these are the organisation which is driven the profit by structuring own
organisation which many stakeholder. Owners, shareholder and financial investor are the one
who get profit. These type of sector depend on market and they get funds from the bank.
Purpose: the main theme to open these type of sector are earn profit form the major customers.
Public sector: this type of sector are govern by the government. For the profit of the total
communities to provide the goods and services. Due to government property they are usually run
by the money which is arises by tax.
Purpose: the main approach of this sector is to help the community by offering their service to
them. The legal structure of the public organisation is highly controlled by the government. The
authority of governance is to take decision.
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Voluntary sector: this are the sector which is run by the help of trust and NGO
department. They are run by fund of those people they donate or charitable. They run for the
purpose of helping other and help in the retaliation of social problem. This organisation is
operated by donation and gifts.
Purpose: this type of organisation help in creation for humankind world to live. The legal
structure of this sector to manage by the top management of those who have better financial
resources.
P2) Size and scope of various kind of organisation
In various enterprise, this is major task which is driven in organisation as a view point to
create some vision and mission. As per this, this help organisation to formulate path and
objective. In addition to this, the flow help an organisation to achieve the objective in effective
manner. The main goals which stand by this is to create and formulate strategies to enhance
profit of firm. In this TESCO is taken:
Private limited:
Mission: Main mission of this organisation is go for the global level and became global
leader and formulate huge base of customer.
Vision: Vision of this is to bring innovative ideas in term of product and services.
Objective: As per the viewpoint with TESCO, they want proper and higher growth and
development of firm.
Size and scope: They have active contribution in local and international market. They
have employee around 400000 across world.
Structure: They usually go through the top down structure which help them to organize
effective work module.
Public limited:
This is various organisation which defined as the government firm which help in operated
with some scope of providing service as well as product.
Mission: The main mission of these type of organisation is to carry product and service in
views with customer and viewer of a country.
Vision: Their vision is always engaged with public and provide quality of product and
services to consumer.
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Size and scope: They have maximum number of employee while they are dealing as per
context with public.
Structure: They follow hierarchical structure in management for operating smooth
function.
Voluntary organisation
They are another type of firm in which they are linked with trustees. In addition to this,
these organisation help to focus on various people at their level. Also they have fixed employee
and shareholder which help them to run these organisation. For example cancer research
department is associated with voluntary firm.
Mission: This organisation have main aim to eradicate the death of cancer.
Vision: Make people free from cancer and help with medication and management.
Objective: Provide proper medication to cancer people.
Size and scope: This enterprise comprises of 4000 researchers, nurses and doctor. It operate at
international level with wide range of facilities.
Structure: They are deal with adaptable and flexible structure.
Thus, this is refers this is focus on various enterprise, which they carried various
operation and activities in effective manner. Which provide growth and development to
organisation.
TASK 2
P3) Critically analysis the interrelationship of various business functions.
Business functions plays important role in order to improve the effectiveness of
organisation. It includes various function which performed effectively in order to achieving
organisation goal and objective of company(Octavia, A. and Ali, H., 2017). There are ample
numbers of function which performed by employee's in order to enhancing profitability and
productivity of company. In relevance of Tesco, it includes marketing, finance, operations,
Human resource and customer service so which are discussed below.
Marketing & finance-: Both are important function of an organisation in order to
performed in effective and efficiently. It includes various types of activities and task which result
as they perform with coordination. Finance function is the main pillar which preparing budget
and estimation and provide marketing head on that basis preparing estimation and then conduct
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marketing activities. In context of Tesco. Marketing manager planned the promotional activities
in order using various promotional tools which helps o promote the products and services
effectively.
Marketing and human resource-: Human resource department mostly linked to all other
department because they recruiting capable and able people who performed activities in effective
and efficiently. In context of organisation, it consider as marketing heads provide the information
of HR manager in order to need candidate because on that basis they performed activities
effectively and efficiently(Fanali and et. al., 2017). Marketing is basic functions of organisation
because they essential to able and capable person who performed the activities very well
mannered.
Marketing and operations- Production department plays vital role in order to conversion
of raw material into finished goods so they are linked with marketing department because they
provide the information related to products and services. Marketing department of Tesco
conducting marketing research in order to know about taste, preferences and market tends that
information provides to operation department on the basis produce products and services.
Marketing & sales-: Both the department are correlated to each other due the marketing
heads promotes the products and services as well as they sales department utilizing various
techniques to sales products and services. It includes both are linked together in order to
enhancing profitability and productivity of company(Sun and et. al., 2016). In context of
organisation, it considered sales manger provide specific time limit to their executive which
helps to attained sales targets effectively and efficiently. It includes developing new stargates in
order to grape market opportunities and gaining competitive advantages along with developing
brand image in the mind of customers.
Marketing & customer service-:Customer service department refers to those which
mostly linked with customers so they effectively and efficiently active because customer are
basic asset of the organisation(Huynh and et. al., 2018). In relevance of Tesco, it involves these
department takes feedback and review of customers and providing information to marketing
department. It consider as marketing head accordingly making improvement in products and
services and fulfilling the needs of end users. Both are internally linked so they effectively and
efficiently solve the problems of customers and providing best experience and make customer
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happy. However, customer service staff refers to those which providing proper training
programmes in order to effectively listen customers problems and well behaved.
Marketing and IT department-: These is department which plays vital role in order to
technology change very fast so organisation using advanced technology with the help of that they
produces effective and efficient products and services so easily gained customer satisfaction
level. Both department works in cooperatively due to without technology marketing cannot
getting best results which impact on profitability and productivity of company. In reference of
organisation, it includes they performed task in effective and efficiently which result as easily
achieving organisation goal and objective of company. IT department helps to marketing
functions and developed innovative products and services and finally serves to customers.
Therefore, it includes various business functions which are internally linked to each other
and achieving organisation goal and objective of company. The performed businees functions
and activities in that way which helps to enhancing productivity and improved the employee's
performance.
Organisation structure of Tesco
Organisation structure refers to those which effectively established in organisation in order to
smooth running of business operations. Tesco followed hierarchical organisational structure
because effectively performed task and activities in order to achieving organisation goal and
objectives. Top level management plays effective role because centralised decision making
system because all important decisions takes higher authority. It includes communication flow
from top to bottom which result as manager communicate all the assigned task to their
subordinates and thy are accountable for these. Top authority responsible to monitoring and
controlling business activities on that basis evaluates employee's performance and then taking
corrective actions. It considered as manager listen the subordinate problems and effectively solve
the concern and query. Managers check the work of their employee's in order to measure the
quality of work which result as performed activities effectively. These communication process
conducting very smoothly which helps to reducing conflicts, confusion between employees.
Tesco operates ample numbers of retail stores in different locations so adhered to followed
hierarchical structure as well as considered all the rules, regulation and policy(Boehler and et. al.,
2017). It is smooth flow of command which result as superior and employees properly followed
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these communication process because they helps to easily managing work effectively and
efficiently.
Hence, organisation structure is essential for each and every company because smoothly
followed proper chain of command and superiors divided task between the employees and they
performed effectively which helps to improving effectiveness of organisation. It includes
employees accomplished task within specific time frame with work must be presented full of
dedication and honesty. Top management plays important role because they are responsible for
work and accordingly managed to enhancing profitability of company as well as providing
products and services which helps to fulfilling the needs and demands of customers.
TASK 3
P4) Critically analysis of macro-environment using PESTLE model.
PESTLE analysis is technique in which help to analysis the external factor which affect
the business performance . Its is strategic tool used by the top management to identify and
analyse the external factor in order to make an impact in organisation and so help to determine
the opportunities and threat which bis related to the arisen factor in organisation.
Political factor: This factor such as various guidelines rules and regulation and their
legislation. The political condition in UK are very stable and government help to follow the
businesses which help to grow the country as well. The positive impact is smooth operation in
function of business in UK(Zhang and et. al., 2016). The negative impact is tax when
government enhance the tax then its a negative for organisation.
Economic factor: in this factor the organisation is affect by the interest rate, inflation
rates, GDP, income and exchange rate. In the context with organisation the low in interest rate
are directly affect the company growth and their operation plans which bring in increases in
profit table and market share of tesco. As per the reports, the economic condition of UK is stable.
The positive impact of UK is stable in GDP and all which take to improve the performance and
profitability of company. And their negative impact are high rate of interest which create an
impact on investment so bring lower profit.
Social factor: it include the various factor such as culture, believe, norms, moral and
tradition and ethics. In the context of enterprise, the organisation carrying such major factor
when carrying out their business activities. Theses factor affect the operation plan because each
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user ha their won taste and culture which they follow so organisation need to analyse this and as
per the view of goods and service are produced. The positive impact is to fulfil the demand of
customer so it impact positive on business grow accordingly a safe view of market. And the
negative impact are cannot serve the service as according to market plan.
Technological factor: in this topic, technology is changes very fast and in rapid mode
which affect the company productivity and day by day brings new innovation and creation with
in product and service. Tesco have their research and development team which a vital role in the
finding of new opportunities for everyone. The positive impact is to utilise the new technical
techniques which is applied in the online shopping and delivery of the product. The social
promote product and services all help the organisation for smooth running. The negative impact
is competitor follow the same techniques for their growth.
Environmental factor: business approach is sustainability are depend on this major
factor such as climatic, whether and pollution and so on. In this present it all will be utilises by
the recycle process and use biodegradable carrier bags which help to environment. The positive
impact the product became eco-friendly and create positive impact in human nature and
environment. Negative impact are organisation do not follow these for a long period of time.
Legal factor: it consist of different kind of legal law which complies the labour law,
minimum wage concept of law and legislative laws. Positive impact of these aspect are legal law
help to grow and developing transparency in the organisational activity. The negative impact are
generally organisation do not follow which affect the reputation of organisation.
TASK 4
P5) Examine internal and external factor which affect the organisational profit and productivity.
Porter five forces have major role in this and which help in observation of organisation
environment. It is a tool basically used to developing new strategies to gain the competitive
advantage and enhancing the profit of selected organisation. This model helps to grab the market
and while helping in expansion of new marketplace in different regions.
 Buyers power: this is element of porter force which defined the buyer ability how they
charge the price of goods accordingly with high bargaining skills. When the buyer is less
and they purchased the most of goods so ultimately the cost switch is low. In the context
with tesco the buyer are more because they have enough option of same good in another
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brand so they easily switch to other brand and purchase the product. The positive aspect
of this if there are maximum number of buyers then organisation have option to to
enhance the profit and productivity. If the buyer are less then it automatically reduce the
productivity which so negative impact on organisation.
 Supplier power: the charge of product and service which is offered to customer. If the
supplier is limited then they will charge whatever they want to charge because of lack of
option in product(Tanford, S. and Jung, S., 2017). The negative impact is customer pay as
much high price for the product and they enhance the profitability and productivity of
organisation. While in the context with tesco the customer negotiate with product due the
other option of product.
 Threat of substitute product: the threat of alternative product is high because there are
lot of option and store of a same product so its all varies in price. in the context of
organisation, supermarket which is available at market place so easily they take
competition with the tesco and decrease the sales profit margins.
 Threat of new entry: entry of new organisation in market is difficult because they
required lot of investment and its difficult to take the existing organisation. It may be
possible by heavy discount to attract customer just like aldi and lidl. They provide good
quality product and service to consumer to take the competitive advantages and capture
huge market share. The positive aspect of new entry in the market is to make profit and
capture the market share. If the planing is to utilise the new technologies and developing
new strategics for making new creative and innovation product to influence the customer.
The negative impact of the new organisation entry in market, they affect the profit and
fall in market share. It is required to spend more money in promotion, advertising and
technology of product.
 Rivalry in market: the existing organisation have many competitive firm which take
down the other to profit so this rivalry never end and which help to find some new idea to
make the business stable.
P6) Evaluate the internal and external strength of organisation
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STRENGTH
 Tesco is largest brand which have
higher in sale and revenue
 They have many store in UK
WEAKNESS
 Ineffective operation system.
 High cost of debt liability
 Less cost of strategy which affect the
profit margins.
OPPORTUNITIES
 Online shopping and uses of social
media marketing to get some profit and
promote the product.
 Target new customer segment.
THREATS
 Morrisson and brexit is threat for tesco
due the cost matter for an organisation
 Developing very tough competition in
market due to aldi and lidl which is
growing day to day.
TWOS MATRIX
Its is techniques used to determine the condition of organisation which minimise the
impact of weakness and making strategies against threats.
Tesco STRENGTH(S)
 Large brand of own
product.
 Cash capital flow
WEAKNESS(W)
 Good quality product.
 Poor liabilities.
OPPORTUNITIES(O)
 Expand their area of
product and services
(SO) STRATEGICS
 Invest capital and make
strategy to attract more
customer.
(WO) STRATEGICS
 Business model in
order to open more
retail outlets in UK.
THREATS (T)
 Brexit and other retail
store are big threats
(ST) STRATEGICS
 Advantage of
purchasing power to
bring down the product
price.
(WT) STRATEGICS
 Developing more
product
 Charge more price for
good quality product.
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STRENGTH WEAKNESSES
 In addition to this, political factor
which provide stability and saturation
to selected firm as per the guidelines
and rules which in initiated by
governance.
 In this their various taxation rules but
as per the low cost rate and recession
firm have gaining profit in economical
vision.
 In context with TESCO, they have
highest employee rate and top two firm
in UK. Which help in given brand
recognition.
 As per this, while Changing various
norms and regulation can direct;y
affected the organisation growth.
 While rise in inflation rate and various
tax paid matter can enhance the
profitability of firm.
 In context with this, all the matter of
strength and weakness also affect
organisation. In which the external
factor start to minimise in rate of profit
margin.
This above strength and weakness of TESCO organisation show the various factor like
political, economical and many more show the macro external factor. In this, the selected firm
take advantages of this which help them to eradicate and improve the functionality of
organisation.
CONCLUSION
As per the above discussion, business environment is an important components for an
organisation in context to greater impact in business functions and role, various type of
organisation which is based on the size and scope and objective of selected company.
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