MGT501: Business Environment - Stakeholder Analysis Report

This report provides a comprehensive analysis of the business environment, focusing on two major Australian companies: Woolworths and Wesfarmers. It begins with an introduction to business management and the importance of strategic planning. The report includes an overview of both companies, followed by a functional analysis of their management, operations, marketing, accounting, and finance departments. A detailed PESTLE analysis is conducted for Woolworths, examining the political, economic, social, technological, legal, and environmental factors affecting the company. The core of the report centers on stakeholder analysis, differentiating between internal stakeholders (shareholders, customers, suppliers, debtors, and employees) and external stakeholders (government, local communities, investors, and regulators). The report also compares the two companies, discusses stakeholder and shareholder theories, and concludes by summarizing key findings and insights, offering a valuable resource for students studying business environment and stakeholder management.

Running head: Business Environment
Business Environment
Name of the Student
Name of the University
Author Note

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Business Environment
Table of Contents
Introduction................................................................................................................................3
Overview of the Company.........................................................................................................3
Functional Analysis of Wesfarmers and Woolworth.................................................................4
PESTLE Analysis of Woolworth...............................................................................................5
Stakeholder in the company.......................................................................................................6
Internal Stakeholder...............................................................................................................7
External Stakeholder..............................................................................................................8
Comparison of Two Company...................................................................................................9
Theory in Stakeholder..............................................................................................................10
Stakeholder Theory..............................................................................................................10
Shareholder Theory..............................................................................................................10
Conclusion................................................................................................................................10
Reference..................................................................................................................................12

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Introduction
Business is carried by each company in different form and techniques as this help the
company to get in the market. Management in each company should be better so that it can
have proper amount of business in the market (Andriof & Waddock 2017). Each company
have different kind of management strategies so it can satisfy the customers in the business.
Company have to make proper marketing strategies so that it can go above the competitors
and able to carry more amount of revenue in the business. The report shows stakeholder
importance in the company and why the company should consider the same while taking any
decision in the company business activities (Andriof et al., 2015). It also about the company
Woolworth and Wesfarmers and show different stakeholder of the company. It also show the
importance and need of each stakeholder in the business.
Overview of the Company
The assignment is based upon the company Woolworth which is an Australian based
company and carry it business activities all over the world. The company is dealing in
consumer good as it is supermarket which have all the type of consumer product for the
ultimate consumers in the country. The company was founded in 1924 and having its
headquarter in Bella Vista, New South Wales, Australia. It able to carry its business in retail
industry as it deal in consumer goods.
The assignment is also based upon the company Wesfarmers which is based in
Australia and able to carry its business in Australia, India, New Zealand and United
Kingdom. It able to carry its activities in retail industry as in deal in product which are
consumer based and able to deal with ultimate consumer in the business.

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Functional Analysis of Wesfarmers and Woolworth
The company is able to manage it business properly by dividing the functional in
different department so that each department is able to fulfil all the requirement of the
business easily and effectively (Ansoff, et al., 2018). The department in which the company
has divided is
Management – Each company should able to have proper management skills so that it can
able to carry its business more easily in the market. Company should have proper
organizational structure so that it able to carry its activities easily in the business (Bridoux &
Stoelhorst 2014). As per the retail industry is concern company have to make a proper
management strategy so that it can able to hold all the requirement of customers easily in the
business. Woolworth and Wesfarmers is able to have proper amount of strategy so that the
company to hold each customers in the business.
Operations – Company should able to have proper amount of operation in the business so that
it can able to carry its activities more easily in the business. It should have a proper operation
in the company so that it can hold all the business activities easily and effectively in the
company (Carroll & Buchholtz 2014). As per the industry which is retail so it should able to
operate proper value chain analysis in the company so that it knows about the different issue
which the company is facing while carrying its product to different location in the market.
Marketing – Company should able to have proper amount of marketing strategies so that it
can hold all the activities of business easily, as the company should make proper marketing
strategies which help them to get over the competitors as well as it will help them to earn
more amount of revenue in the business (Christopher 2016). As per the industry is concern it
is dealing in consumer product so this should be considered while selecting the marketing
strategies of the company as it should able to reach the ultimate consumer who are willing to

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pay for the product in the business. It should able to concentrate upon the advertisement also
as this will help them to gain a proper market for the business.
Accounting – Company should able to have proper amount of accounting of system in the
business so that it can record all the transaction more easily and effectively in the business. It
should able to have proper process of accounting that will help the company to gain an
advantage over the competitors of the business (Cooper 2017). As per the company is able to
meet all the required accounting transaction so that it can record all the details properly and
effectively in the business.
Finance – Company should have proper amount of finance so that it could able to carry its
business activities properly in the business. Company have to make proper decision in
regards of financing of different project that will help them to gain more amount of revenue
in the business (Crane & Livesey 2017). As per the company is concern it able to diversify it
finance structure so that it could able to gain more amount of revenue from the business, so
that the company can hold more interest in the business and able to expand the business
operation more easily and effectively.
The above point shows some aspects of the company and there are being managed by
the same as this will help the company to gain a proper amount of income as well as to gain a
proper position in the market (Fayol 2016). It also shows how the company is able to divide
its functional area so that the company can carry all the activities easily in the business.
PESTLE Analysis of Woolworth
Pestle Analysis show about the company strategic in regards of its macro environment factor
in business.
Political – This are the factor which can direct effect the company long term goals and
objective. As the changes in government policy in related to food and staple industry can

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easily impact the company financial position and also change in legal framework can impact
overall business objective.
Economic - It deals with macro environment factor such as inflation rate, growth rate and
saving rate. Woolworth should take into consideration the inflation rate as the company is
working in different economy so it should work as per the economy of the country.
Social – This show the cultural value which should be consider by the company in order to
tle more coverage in the market. As it should take into consideration of demographic changes
and should implement those in the company marketing strategies.
Technology – Company should able to meet all the changes in the technology so it can able
to meet up with its competitor in the business. As it should see the recent changes which their
competitors has done in their technology and should implement similar change in the
company.
Environmental – Each market has it own environment and the company have to work
accordingly so it should the see the affect of weather change, climate change in the company
and should make strategies making these into consideration
Legal – Each company have to follow different legal framework as per the company so
Woolworth should check all the change in law and should implement those change in its
current business practice.
Stakeholder in the company
Stakeholder are the one who have some kind of interest in the company may be direct
or indirect interest in the company. It should be the one who the company should consider
while making any decision in the company,
Stakeholder can be of two types Internal Stakeholder and External Stakeholder

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Internal Stakeholder
This are the one who directly get affected by the company decision as they are
directly connected with the company financial position, so if the company take any decision
than their interest will directly affected by the same. The internal stakeholder in the company
are:
1. Shareholder – They are the one who are the owners of the company and able to get
proper amount of interest in the company (Henisz, Dorobantu & Nartey 2014). As the
company is able to have any changes in their business activities than this will directly
affect company shareholder interest so company should consider their value while
making any decision in the business.
2. Customer – There are the one who directly deal with the company as they purchase
different product and service from the company so if there is any change in the
company business activities than it will directly affect the interest of the consumer in
the company (Holling 2017). So company should consider the same while carrying
any changes in the financial statement of the company.
3. Suppliers – They are the one from whom the company is able to purchase raw
material so that the company is able to make proper product and able to carry its
business activities properly in the market (Jones, Wicks & Freeman 2017). The
company should consider all the activities of suppliers so that it can take proper
amount of decision in company financial statement. As they directly get affected
from the changes in the company business activities.
4. Debtors – They are the one from whom the company is able to get their money for
the product and service which the company is able to have from its business
activities. It should able to see all the credit policy and other details in the company

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so that, it can make proper decision in regards of the debtor of the company (Kaplan
& Atkinson 2015).
5. Employees – They are the one who worked in the company and able to help them to
reach the goals and objective easily and effectively in business. The company
changing any policy will directly affect the company employee so this should be
taken into consideration by the management while taking any decision in regards of
the employee (Laudon & Laudon 2016). The company should check all their decision
properly so that the company employee can work properly and able to reach the goals
and objectively easily in the business.
External Stakeholder
They are the one who get affected by the company indirectly as they are not directly
related to company business activities. The external shareholder is:
1. Government – This are the one who control all the economy of the country, they are
not directly connected with the business activities but indirectly it is attached with the
same (Noe et al., 2017). As the company is changing its business activities than it can
able to look how this will affect company revenue as well as how the economy is
getting affected by the same, so company should able to have proper amount of
clarification while making any decision in the business.
2. Local Community – These are the one in which the company is able to carry it
business activities so they are also get affected by company decision as if the
company is not able to make product related to the consumer than it will not able to
handle the same in company business, as the company is able to generate revenue as
well as job for the public so it should take into consideration while making any
changes in the business activities of the company.

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3. Investors – They are the one who invest in the company so that it can carry its
business operation more easily and effectively in the business. The company change
any business activities so it will affect the interest of the investors as they are having
their money involve in the same, so company should able to consider this while
making any changes in the decision of business activities.
4. Regulators – They are the one who regulate the market in which company is taking
money from the public so if the company is changing any business activities than it
should be consider by regulators because the company is having large amount of
public money involvement so company should able to see this factor while making
any decision in the business activities in the company.
Comparison of Two Company
The company both are dealing in retail industry so both are having similar number of
products in the business. As per the analysis of the companies it is found that Wesfarmers is
having more amount of business in the market in compare to Woolworth. It is having more
amount of revenue in the business as well as it able to hold more number of customers in the
business. Each company is managing their business activities properly but as per the research
it is found that Wesfarmers is able to have proper management in company so that it can
carry all the activities easily in the business. The company is able to own Coles which is
having proper amount of brand value in the company as well as it is having many old
customers so this help them to gain more amount of revenue in the business.
Both companies are having knowledge and experience in the business, but the
company is able to manage its operation more easily so that the company can carry all the
activities easily in the business. It able to hold more proper ratio in compare to Woolworth
that let them to have more financially strong which let them to get more investment in
company business which result in more expansion of business in the market.

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Theory in Stakeholder
Stakeholder Theory
It states that company should take into consideration all the stakeholder while making
any decision in the company, as the company should not only take the shareholder interest
but should also take into consideration of stakeholder as they are the one which should also
be consider by the company in regards of the decision in the company. As the company is
always able to take decision in regards of the interest of shareholder and not considering the
interest of other stakeholder so this should be considered by the company while making
proper decision in the company business (SA & Rica 2016). Each stakeholder gets affected
by the company decision so these should be considered by the company in regards of each
decision which can affect their interest.
Shareholder Theory
In this theory the company only consider the interest of shareholder while making any
decision in the business activities, as this state that the company should able to make proper
research about the effects which their decision can make upon the interest of shareholder and
able to take necessary decision of the same. Company main motive is to maximize the profit
so that the shareholder can able to achieve all the desired return from the company easily and
effectively. The company should able to focus upon how they can increase the profit of the
firm as it deals with traditional approach of the company in the business. This help the
company to give more amount of dividend or increase in share market price in the company.
Conclusion
The report concludes about the marketing concepts as how the company is able to
carry its business operation with the help of marketing and management technique. It shows
different aspects of industry and how the industry is able to perform well in the market. The

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report concludes about the retail industry which is carrying its business in Australia. It shows
about the company aspects as how the company is able to carry its functional activities more
easily and effectively in the business. It also shows the meaning of stakeholder as they are the
one who get affected by the company decision as well as it show different types of
stakeholder in the company. Lastly the report concludes about different theory and how the
company is able to manage their business operation with the help of this theory. It concludes
upon the stakeholder theory and shareholder theory as in stakeholder theory company have to
see interest of all the stakeholder while making any decision in the business whereas in
shareholder theory company have to work only for shareholder interest so that it can able to
give more amount of dividend to the company shareholders in the business.

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Reference
Andriof, J., & Waddock, S. (2017). Unfolding stakeholder engagement. In Unfolding
stakeholder thinking (pp. 19-42). Routledge.
Andriof, J., Waddock, S., Husted, B., & Rahman, S. S. (2017). Unfolding stakeholder
thinking: Theory, responsibility and engagement. Routledge.
Ansoff, H. I., Kipley, D., Lewis, A. O., Helm-Stevens, R., & Ansoff, R. (2018). Implanting
strategic management. Springer.
Bridoux, F., & Stoelhorst, J. W. (2014). Microfoundations for stakeholder theory: Managing
stakeholders with heterogeneous motives. Strategic management journal, 35(1), 107-
125.
Carroll, A. B., & Buchholtz, A. K. (2014). Business and society: Ethics, sustainability, and
stakeholder management. Nelson Education.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Cooper, S. (2017). Corporate social performance: A stakeholder approach. Routledge.
Crane, A., & Livesey, S. (2017). Are you talking to me?: stakeholder communication and the
risks and rewards of dialogue. In Unfolding stakeholder thinking 2 (pp. 39-52).
Routledge.
Fayol, H. (2016). General and industrial management. Ravenio Books.
Henisz, W. J., Dorobantu, S., & Nartey, L. J. (2014). Spinning gold: The financial returns to
stakeholder engagement. Strategic Management Journal, 35(12), 1727-1748.
Holling, C. S. (2017). Adaptive environmental assessment and management.

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Jones, T. M., Wicks, A. C., & Freeman, R. E. (2017). Stakeholder theory: The state of the
art. The Blackwell guide to business ethics, 17-37.
Kaplan, R. S., & Atkinson, A. A. (2015). Advanced management accounting. PHI Learning.
Laudon, K. C., & Laudon, J. P. (2016). Management information system. Pearson Education
India.
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill
Education.
SA, P. W. P., & Rica, C. (2016). Forest management.