Business Environment Report: Analysis of Organizational Structures

This report examines the business environment, focusing on the structure and function of organizations, including private, public, and voluntary sectors, with ABC Consultant Ltd. as a case study. It analyzes the different organizational groups and their interrelationships, using organizational charts to illustrate advantages, disadvantages, and potential effects on the system. The report further employs PESTEL and SWOT analyses to identify the macro and micro environmental impacts, key findings, and their implications on the organization. It also explores the complexities of different business structures and their interrelationships, providing a comprehensive overview of the business environment and its factors. The report concludes with references to support the analysis and findings.

Business Environment

Table of Contents
Introduction......................................................................................................................................3
Task 1...............................................................................................................................................3
1.1 Different types of organization on the basis of their purpose and legal structure.................3
1.2 Difference between the different organizational groups......................................................4
1.3 Interrelationship of system using organizational chart including advantage and
disadvantage along with possible effect on system.....................................................................6
1.4 Complexities of different types of business structure and its interrelationship function......8
M1...............................................................................................................................................9
M2...............................................................................................................................................9
D1................................................................................................................................................9
Task 2...............................................................................................................................................9
2.1 PESTEL analysis in order to find the macro environmental impact on the organization....9
2.2 SWOT Analysis in order to identify the internal and external impact on the organization.
...................................................................................................................................................10
2.3 Key finding on the basis of internal ad external analysis, impact on the micro and macro
environmental factor of the organization..................................................................................11
M3.............................................................................................................................................12
M4.............................................................................................................................................12
D2. ............................................................................................................................................12
Conclusion.....................................................................................................................................13
References........................................................................................................................................1

Introduction
Business environment is considered as the combination of internal and external factors
the affect the commercial of a organization. Internal and external factors affect each other also
and combinational affect the business organization. External factor of any organization is
considered as the political, micro economical, macro economical and social. In the external
factor of an organization the staff and employees are considered who are working for the
organization (Aterido, Hallward-Driemeier, and Pagés, 2011). The present business report is
based on the business environment considering various parameters such as types, their function,
structure and advantage and disadvantage of these organizations. On the basis of which ABC
consultant Ltd. operates their business in effective manner.
Task 1
1.1 Different types of organization on the basis of their purpose and legal structure.
Business organizations are broadly divided into three sector such as private , public and
voluntary . And each sector works with different objectives such as the private sectors are more
emphasis on the profitability, maximize the business growth and the other factors are considered
as the secondary parameters, where in the public sector the major objective of these organization
is to provide good quality of product and services to the customers. These organizations are
operated by the government and financed by the tax paid by citizen. Voluntary organizations are
not owned by any individual person or firm but run by the group of people who work in order to
achieve the set target from a specific budget. ABC consultant Ltd. also belongs to the private
sector business organization. Private sector: The private sector organizations are mainly divided into four parts such
as sole traders, partnerships, companies and franchise. Under the sole trader quick
decisions can be made and relationship between the client and employees became
closer. Under partnership organization is owned by two or more people in specific ratio.
In this approach people provide their skills and workforce. Under this the organization is
owned by stakeholders in order to give appropriate direction to business. Under
franchising method other ventures of same organizations are started. The retail sale of
venture become half the franchise doubled. One of private sector agency of UK is Virgin
Atlantic which is having the clothing market into UK (Chavis, Klapper,and Love. 2011).

 Public Sector: In this sector, firms are owned and operated by government agencies.
They work in order to provide high quality of goods and services to fulfil their needs. The
public sector in not emphasis on the profitability. Funding of these organization are
provided by the government in the for of Tax paid by the people. Various public sector
services that are provided to the citizen of country by government are like education
facilities in the form of schools, colleges and libraries opened by government agencies.
The example of public sector agency of UK is Government Communication
(headquarterGCHQ) working in order to improve quality of communication services to
the users of UK (Commander, and Svejnar,. 2011).
 Voluntary Sector: This sector is considered as diver sector because in this various
multinational charities and local communities participate in order to work for the
betterment and welfare of the society. These organizations also helps various public
sector firms by providing help in the form of health patients, educational groups and
much more. The example of voluntary sector agency of UK is Marie Curie cancer care
working to help the cancer victim in order to provide health facilities.
1.2 Difference between the different organizational groups.
Basis Private Sector Public Sector Voluntary sector
Meaning The private sector are
mainly focused on
maximizing
profitability for the
organization.
The public sector
organizations are
mainly focused on
providing high quality
of services to the
public.
Firms operating in
voluntary sector puts
their emphasis on the
work for the society as
public sector do by
focusing on the
services.
Size Size of private sector
is largest among three
organizations because
they are established at
various part of the
Size of public sector
are considerably large
but may be sometime
smaller then the public
sector because the run
The size of voluntary
organization is usually
small as compare to
private and public
sector because they are

world because they
emphasis on producing
huge amount of profit
and increase the
growth of the
organization.
in country and the
funding is provided
from Tax paid by the
citizens of that
country.
based on the charity of
volunteers which may
depends on others.
Scope The scope of private
sector is vast because
its major emphasis is
profitability.
The scope of public
sector is limited and
peoples need oriented.
The scope of the
voluntary sector are
also focused on the
peoples needs.
Stakeholders Stakeholders of the
private sector
organizations are the
creditors, directors,
employeess,governme
nt agencies, owners,
suppliers and unions.
Stakeholders of the
government
organizations are team
manager, customer,
line manager, supplier,
trader.
Stakeholders of
voluntary sector are
beneficiaries,
funders,volunteers,
trustees, staff and
partner who are
working with the
organization.
The relationship between private, public and voluntary is like customer and the
benefactor. ABC consultant Ltd. also shares a healthy relationship with the other sectors. Where
the public sector and the private sector are considered as the customer and the private
organization are considered as the benefactor. The relationship is based on the three terms
manufacturing, construction and automotive industries. In these the relationship between the
public and the private sector is becoming more strong by making more investment into the health
care sector. The relation between three sector become the territorial evolution means. The
objective of the three sectors are might be different but the services that are provided to the end
users are of considerably good amount. All the three organizations are working to reach the
customer satisfaction level (Cordes, Richerson, and Schwesinger,2010). By fulfilling the

requirement on the basis of the product review. The products and services provided to customers
are of good quality and tested into various segment of development process.
1.3 Interrelationship of system using organizational chart including advantage and disadvantage
along with possible effect on system.
Organizational chart is used to represent the hierarchy of employees according to their
job function. In order to operate the business effectively and consistently, planned sequences of
the action in a specific style, size and operation according to the need of organization. ABC
consultant Ltd also follow certain organizational chart in order to manage the process . Through
this organizational chart, the responsibilities of manager, supervisor and operator of organization
are managed. Through this work of the employees can also be measured or monitored.
(Source: Craig, and Campbell,. 2012)
In this organising and designing department is handled by the manager of their division in
order to meet the need of customers. Similarly, the supervisor works with manager in order to
guarantee operation, process and quality of work. Operator works in order to meet operational
requirements of organization.
Functions of organization: Every organization use certain set of functions in order to meet the
need of firm. To manage various issues of organization different functions are created to manage
and handle the same. These are mentioned as planning, organizing, staffing, directing and
controlling. They are described as:
Illustration 1: Organizational chart

1. Planning: It is considered as the fundamental stage of functional management process. In
this step, the planning of the development process and design takes place. The planning
of process is considered as the initial step of product function management process (
Gecevska, and et. 2010).
2. Organizing: Under this process, all physical, financial and human resources are brought
together and the relationship between them is maintained. In this, the raw
material,instrument,assets and organisation are required in order to produce the output.
This process consists of identifying and supplying the needs related to human and non-
human resources to organization.
3. Staffing: Staffing is considered as one of theimportant functional management step. The
importance of staffing has increased in the recent years for appointing right people for the
right work. Staffing concerns with:
◦ Workforce planning
◦ Training & development
◦ Wages and remuneration
◦
◦ Increment & transfer
4. Directing: It is also considered as an important step of development process because
under the same, proper direction is provided in order to achieve work efficiency for the
proposed project of organization (Hamilton, and Webster, 2015). It takes place as the
internal process of organization as it involve discussion of planning, organizing and due
to this influence the quality by guiding and supervising the process. The important
segments of the directing function are:
◦ Supervisor
◦ Motivation
◦ Leadership
◦ Communication
5. Controlling: It consists of the process of measuring correctness and quality of work
along with trying to ensure the goal that organization needs to achieve. Major objective
of controlling is to check the quality of product that whether it is meeting the standards of
organization or not.

Advantages
1. Profit of specialisation: As the organizations are divided into small teams on the basis of
tasks therefore, the activity becomes easy and process becomes less time consuming.
2. Timing is constituted: As the employees are working into small teams, togetherness and
specialisation get increased.
3. Social control Ratio is increased: Through this, social control ratio has increased due to
the repetition of task (Iskanius, Page, and Anbuudayasankar, 2010).
Disadvantages:
1. Ignorance of aim: As all the departments are working on their part, in that case,
departmental objectives are fulfilled and the organizational aim may suffer.
2. Conflicts of interests: Due to this, all the segmented departments of the organization
became the functional empire so they due to this demand of resources maximize due to
which resource conflict may occur.
Virgin Atlantic is the business organization of UK that belongs to the private sector
having clothing market into UK. The potential effect caused on the organization's structure due
to the functional organizational will be positive because through this management scheme the
work is distributed among various levels of the organization on the basis of the ability and at
every level certain supervisor are appointed to monitor the work so the quality of the work will
be maintained.
1.4 Complexities of different types of business structure and its interrelationship function
There are lots of complexities that are associated with any business that stops the
business organization from achieving its goals. There are many factors through which process
may get affected like when an individual is opening his/her business but only by having the
support of couples of investors the expansion of the organization become dificult , but through
the sole proprietorship the organisation can grow by having low Taxes rate and buy having
proper regulation of the significant rules. Similarly, in the partnership, organization may face the
problem of general and limited partnership. Under the general partnership, under this method
two or more than two two people can generate the capital and other expenses for the
organization. Limited liability corporation only specific types Limited liability corporation only
specific types for this process written by including a proper format in order to make the process
more strong ad the management process of the functional organization use a rigid define

structure. On the basis on above mentioned the different business complexities can be easily
rectifier a new solutions of the problems will be introduced in order to make the process more
efficient. As all the three sectors are closely interrelated with each other in that case if any of the
stage any complexities is identified it can be easily removed on the basis of the above
approaches. The ABC consultant Ltd. Uses the same approaches in order to solve the problems
that arise during the process of business structuring.
M1.
The organizations vary on the basis of structure, size, scope and stakeholders because in
the private sector organization the size of the organization is large and extended up to different
countries and as they mainly focused on the profit so they have vast scope and opportunities, and
the organizations have various stockholders. Where in the public and voluntary sectors the major
focused is placed on providing the quality services to the users. The size of the organization is
large but fixed for a specific region and the organization are provided with limited scope that are
directly affecting the people (Kim, Suresh, and Kocabasoglu-Hillmer, 2013).
M2.
Due to the interrelationship of the organization lots of benefits are introduced in to the
business world but along with that certain drawbacks are also encountered such as during the
process of interrelationship the organization is divided into small department and working on the
basis of specific task due to this the production of the result will be increased but along with this
the conflict among the different department may start in order to get more number resource.
D1.
Lots of complexities are introduced during the process of business structuring using
different approaches on the basis of which various solutions are also provided by the in order to
achieve the goal of the organization. There are many factors that make a direct impact on the
business structure and organization and that can be achieved by the sole proprietorship under
which various written work is involved in order to make the process complete. Partnership and
Limited liability corporation are also use to reduce the complexities of the process.

Task 2
2.1 PESTEL analysis in order to find the macro environmental impact on the organization.
PESTEL analysis is a tool that is used by the marketplace to study and supervisor the
external environment factors that made an impact on the organization. The ABC consultant Ltd.
Also uses the same analysis method in order to completely examine the external impact on the
organization. This is known as PEST analysis where P stands for political,E stands for
economic,S stands for the social,T stands for technology, E stands for environmental and L
stands for Legal. The macro environmental analysis for the ABC consultant Ltd. Can be doe by
using this method in which all the external factors are considered. Political factor: Under this method all the political factors are considered that affect the
business and have the government involvement such as markets, foreign trade, policy, tax
policy, employees law, environment law and much more (Klapper, and Parker, 2011). Economic factor: This factor also plays an important consequence in the organization,
under this factor all the economical growth, interest rate, exchange rate, inflation related
issues are considered under this factor. Social factor: Under this factor all the social and cultural issues that are related top the
organization are considered. In this factor are considered such as population growth, age
distribution, health related issues and so on. Technology factor: Under this factor all the technical and technological issues are
considered such as the introducing new technologies in order to produce new services
and goods and contribute into the development of the organization. Environmental factor: Under this factor all the environmental issues are considered that
due to abundance of rude material the importance of the environment is automatically get
increased the business organizations do their work ethically without affecting the
environment. Because this may cause huge loss to the society.
 Legal factor: Under the legal factor the factors are included such as the health and safety
of the employees, consumer rights, equal opportunities, product labelling and product
safety are considered under this section. Through this factor the rights of the employees
and customers remain safe and can use the right at the time when they need.

2.2 SWOT Analysis in order to identify the internal and external impact on the organization.
SWOT analysis is based on the result generated by the PESTEL analysis in this analysis
method all the strength, weakness, opportunities and threats that are related to the organization.
The ABC consultant Ltd. Also uses the same analysis method in order to completely examine the
internal impact on the organization. This method is used by the business organizations in order to
find the business growth on the basis of the internal analysis and the external analysis. Under the
internal analysis the strength sad the weakness of the organization is considered where in the
external analysis the opportunities ad the threats of the organization are considered. Strength: Under this method the organization consider certain question and on the basis
of that specific step is taken such as what are the characteristics of project that can be
considered as the advantageous for other is considered as the strength of the organisation. Weakness: Under this method the organization consider the characteristics of project that
can be considered as the disadvantageous for other is considered as the weakness of the
organisation. Opportunities: Under this method the organization consider characteristics of project
through that it can use the element of environment considered as the advantageous for
other is considered as the opportunities of the organisation.
 Threats: Under this method the organization consider characteristics of project through
that it can problem for environment considered as the harmful for other is considered as
the threat of the organisation.
On the basis of the SWOT and the PESTEL the closely relation with each other such as in the
PEST analysis we are considering all the external factor the affect the business where in the
SWOT tool the internal and external analysis both approaches are used in order to find the
strength, weakness, opportunities and tools for the business organization. On the basis this
analysis the organization is able to make action plan in order to find the strength and weakness,
opportunities and threats on the basis of the various factors such political, economical,social,
technological, environment and legal.
2.3 Key finding on the basis of internal ad external analysis, impact on the micro and macro
environmental factor of the organization.
On the basis of the analysis the ABC consultant Ltd. Has the significant impact of both
the internal as well as the external analysis (Wang, Chen, and Chen, 2012). Under the external

analysis where the political factor is considered under which the factors such as markets,
foreign trade, policy, tax policy, employees law, environment law are included due to which the
organization has to follow all the law and and on the basis of the policies tax and other revenue
has to be provided to the government. Otherwise the organization may suffer due to negative
impact of this factor. In the economical factor the factors are considered as economical growth,
interest rate, exchange rate, inflation related issues are considered under this factor on the basis
of which the organization is able to measure the growth of the organization. In the social factor
are considered such as population growth, age distribution, health related issues on the basis of
which the organization is able to make different marketing strategies. In the technological factor
are considered as all the technical and technological issues are considered such as the
introducing new technologies in order to produce new services and goods and contribute into the
development of the organization. Through this the organization can improve the technological
effort in order to improve the quality of the services. In the technological factor are considered
as all the environmental factor that can affect the balance of the ecosystem the organization
should take care of that their activity does not harm the environment. Under the legal factor the
factors are included such as the health and safety of the employees, consumer rights, equal
opportunities, product labelling and product safety are considered under this section which are
use to protect the employees and customers from any loss.
Similarly, on the basis of the SWOT analysis the strength of the business organization are
identified on the basis of which it can provide advantages to other , and by using the weakness of
the business organization the weak elements are considered that may considered disadvantageous
for others. In the opportunities new scope are identified by the organisation and under threats the
organization are able to find the problem creator elements of the process.
M3.
On the basis of the PESTEL tool the organizations are able to analyse the various factors
on which the external impact of the organization can be created. In order to analyses the impact
various parameters are provided such political, economical, social, technological, environment
and legal. The ABC Consultant Ltd. Also uses this tool in order to analyse the external for the
organization (Wang, and Ellinger, 2011).

M4
On the basis of the SWOT analysis tool that are use to analyse the internal impact that
may cause significant impact on the organization. Such as by identifying the strength and
weakness , opportunities and threats of internal factor that may cause a significant impact on te
organization.
D2.
Both the PESTEL and the SWOT are the tools that are considered by the organizations in
order to identify the internal and the external factor that may cause significant impact on the
organization. On the basis of the factors various that are use to be considered by the business
organization. In this the PESTEL is considered as the external tool where the SWOT are
considered as the internal tool.
Conclusion
On the basis of the above report the conclusion is drawn that the business organizations
are divided into three parts such public, private and voluntary sector on the basis of that different
size,scope and stakeholders provided to the organisation (Xue, Shen, and Ren, 2010). Along with
that the follow a common functional structure that are use to describe the action plan of the
process. Along with this role of PESTEL and SWOT is considerably important into identification
process.

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Online
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