Analyzing UK Organizations: Nature, Size, and Growth

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BUSINESS AND BUSINESS ENVIRONMENT

Executive summary
The current report successfully analyses the different types of organisation in UK
based on nature and size along with their growth prospects in international business
market. As such the private, public and voluntary organisations are studied and each
of their background, objectives and scope has been studied as well. Further, large,
medium and small scale business is also evaluated and SWOT and PESTLE
analysis has been conducted in order to understand the various benefits and issues
faced by the companies to make decisions.
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Table of Contents
Introduction................................................................................................................. 3
1. An overview of different types of organisations and the growth of the international
business environment (LO1).......................................................................................4
2. Explanation of chosen organisations in relation to its background details the
products and services supplied, size and scope of the organisation, objectives, legal
structure and information about their respective stakeholders (LO2)..........................6
3. in detail, explain the functions for one of the chosen organisations, using an
organisation chart to show how the functions interrelate and an explanation of how
they relate to structure (LO2)......................................................................................7
4. Use contemporary examples to demonstrate both the positive and negative
influence/impact the macro environment has on business operations (LO3)..............9
5. Determine the internal strengths and weaknesses of specific businesses and
explain their interrelationship with external macro factors (LO4)...............................11
Conclusion................................................................................................................ 13
References................................................................................................................14
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Introduction
This study has attempted to analyze various types and structures of organisations in
the UK. The organisations are categorised based on the criteria of public, private and
voluntary organisation. The report discusses the overall background details of these
organisations along with the factors internal and external business development.
Further in this report, a broader study has been incorporated to study the salient
features of a chosen one big organisation based out of the UK and SWOT-PESTLE
analysis has been conducted to demonstrate the overall scenario of the organisation.
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1. An overview of different types of organisations and the growth of the
international business environment (LO1)
There are indeed various kinds of organisation in the UK that are classified on the
basis of the scale of the business operations of the organisations and the nature of
their business. These are medium, micro and small scale. To name three
organisations of such features are in brief explained below:
Public Sector
In public sector or organisations, the ownership is shared and open to all public in
general and any individual has the sole right to purchase stocks of the company
(Fernandez and Rainey, 2017). For example, cabinet office, British Council and
Department for International Development (DfID) are public companies.
Private Sector
Private sector mainly focuses on making revenue and profit and increasing customer
base and brand awareness. These companies are handled by private individuals and
they are basically organisations. As an example, John Lewis Partnership and Argos
are private companies.
Voluntary Organisations
Voluntary organisations are neither held by the public nor are they profit based
organisations. These organisations operate primarily of funds that are donations and
they operate to contribute towards a greater cause that is to offer social good in a
community as a whole (Warner and Sullivan, 2017).
Legal Structure
A legal structure is the one that basically provides an appropriate style and structure
to organisations based on legal considerations and time.
Another structure of organisational classifications is the large, medium and
small organisations on the basis of size and scope of these organisations-
Large organisations
Large scale functions of a firm refer to those organisations which operate on a basic
objective of generating substantial revenue and these organisations employ a
minimum of 300 employees throughout all the stages of its operations. The UK’s
economy provides a detailed statistic that almost 40% of its working population is
engaged with such large organisations in the UK (Haigh et al., 2015). Alongside, it
has 25 % hold in the total market share that accounts for the organisations' 1686
billion pounds turnover as the profit margin.
Medium organisations
In comparisons to the large scale organisations, medium organisations recruit
employees not more than 250 and the basic objectives of such organisations are
national customers oriented. The UK accounts for 13 % of its working population to
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be engaged with the Medium organisations. The market share of these organisations
accounts for 17 % market share with 595 billion pounds as profit turnover.
Small organisations
Small organisations are not more than 50 employees per department. Such
organisations major objectives are to survive in the market while focusing on short
term goals of such organisations Examples of small organisations in the UK’s market
are the travel agencies. And the UK accounts for a minimum of 4 % of its working
population to be engaged in this sector with a market share of 5 % and profit
turnover of around 490 billion pounds per annum.
Growth of the international business environment
Possibilities of growth in environment of international business have tremendous
effects on various organisations basic business operations. These are basically
dependent on the external global factors which are namely the socio-cultural,
economic, political, environmental, political and technological aspects of operations
(El Ebrashi, 2018).
Differences between franchising, joint ventures and licensing
Franchising
The process of franchising needs appropriate assistance from franchiser and is a
mandatory arrangement where a franchisor basically permits to whoever the
franchise is to use the brand name or as such any business models to conduct
another business in its name or open an independent branch of the parent company
as such (Burton and Cross, 2015).
Joint ventures
Joint ventures are agreements that two companies make of either providing
resources to each other's company or any other assistance for a certain period of
time that has been mutually decided and payments that are settled accordingly.
Licensing
Licensing refers to the arrangement of the company’s rights to sell the rights to use
the intellectual property and thereby produce a company‘s product to a license of
royalty.
Market forces and economic operations
The market forces of varied organisations in the UK refer to certain factors that
change the accessibility of services and goods in the market along with its definite
prices with minimal intervention from the government (Terjesen et al., 2016). The
economic operations, on the other hand, refer to the economies of scale that is very
important for all organisations to incorporate in its scale of operations in order to
analyze about the cost as well as input and output functions of the operating
organisations.
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2. Explanation of chosen organisations in relation to its background details the
products and services supplied, size and scope of the organisation,
objectives, legal structure and information about their respective stakeholders
(LO2)
Three organisations have been chosen with regards to providing the basic
organisational structure which is depicted below:
Aspects Public
organisation
Private organisation Voluntary
organisation
Names of the
organisation
Department for
International
Development
(DfID)
Captify Cancer Research
UK
Background The company
recruits graduates
for international
development. The
organisation deals
with the global
security, disaster
and poverty of the
UK (GOV.UK,
2019).
Captify is a data
intelligence platform built
up with semantic
technology and search
engine capabilities.
The organisation
basically works to
help the cancer
ailing patient and
develop new
treatments.
Objectives The objectives are
to responsibly and
effectively engage
in the development
of society by
reducing poverty
and promoting
security and peace.
.
The objectives of this
company cater to the
needs of developing and
enhancing better data
intelligence platform in
order to increase their
customer satisfaction and
their revenue along with
increasing their brand
recognition in the
international market.
Saving lives
through research is
the main objective
of this organisation
and cure cancer.
Size It is a large
company with more
than 3000
employees.
With around 180
employees each
department, the company
is a medium scale
industry (Captify, 2019)
It is and
awareness charity
and research
centre with around
3964 employees.
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Scope The company has
scope in the areas
development,
eliminate world
poverty and
promote
sustainable
development.
The company has scope
in the areas of
experimentation and
technology.
The company has
scope is the areas
of influencing and
elevating global
and local decisions
in order to
accumulate better
fund generating
ideas.
Legal
Structure
The company is a
large public sector
industry with
separate and
unique legal
entities.
The private company
Captify relates to private
legal structures and
policies.
The legal structure
of this charity
awareness
institution is based
on its trustees and
other
administrative
authorities.
Key
stakeholders
The stakeholders
are the official
partners and
government.
The stakeholders are
suppliers, staffs,
customers, business
partners and
shareholders.
The stakeholders
are its volunteers
specifically donors
and alliances.
Table 1: Detailed structure of organisation
(Source: Created by the learner)
3. in detail, explain the functions for one of the chosen organisations, using an
organisation chart to show how the functions interrelate and an explanation of
how they relate to structure (LO2)
Organisational functions of various departments and organisational structures
The various organisational functions and structure of the Argos Company has been
listed below and explained in brief:
Departmental structures
1. Sales department
The sales department of Argos is interrelated to the operations department at the
same time to operate and control the business of sales and promotion effectively.
2. Operations department
The operations department of Argos is connected to the manufacturing and human
resource department for the constructive functioning of processes that involves
project operations fiscal policy operations management (Wilson, 2015).
3. Manufacturing department
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The manufacturing department of Argos in sole performance with the operations and
sales department looks after the production of goods and services as per as the
customer demands.
Figure 1: Different functions of organisation
(Source: Damanpour et al., 2018)
4. Human resources department
The HR department in similar way has to be interlinked with the operations and
manufacturing department in order to develop an understanding of the complete
working environment in various departments of the industry and recruit employees
thereafter (Damanpour et al., 2018).
5. Finance department
The finance department of Argos ensures that there are enough funds for the
company in order to perform various functions that include paying for the salary of
the employees, buying raw materials, paying for the capital investing and other stuff
in the company that needs the finance back up as well.
5. Strategic business units
The strategic business unit of Argos operates as an independent body with the
responsibility of undertaking various tasks of products and services.
Organisational structures
Functional Structure
The functional structure refers to the identification of hierarchical structure in a
company along with undertaking responsibilities of management and development of
a company.
Bureaucratic and post bureaucratic structure
Bureaucratic and post bureaucratic structure are developed forms of structures and
involves a lot more procedure where decision making in the company is followed up
a democratic procedure (Geels, 2018).
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Matrix structure
The matrix structure is normally used in global operations in different large
organisations and as such Argos follows matrix structure in its organisation under
which there are different sections for local and international operations as well as
both the functional and divisional structure is followed by the managers.
Parent structure
Parent structure has the power of functional and divisional organisational structure
where it can relatively hold enough amount of stock in other companies (Gudgin et
al., 2018).
Advantages and disadvantages of interconnected functions and its effects on
organisational structure
Advantages
The advantages of interconnections between functions and its influence on
organisational structure refer to the advantages that it creates in the field of faster
operations. Argos has seen that after the interlinked work of the sales and
manufacturing team, it has been able to deliver to its customers in the retail sector
more efficiently than it did before (Hodgkinson and Sadler-Smith, 2018). Argos has
also encountered advantages in the fields of reduction in the workload of various
departments along with a better response to the current market trends and better
development in its products.
Disadvantages
The disadvantages Argos has recently faced are in the areas of changes in the
conflict and excess competition that creates a lot of inefficiency and
miscommunication issues.
4. Use contemporary examples to demonstrate both the positive and negative
influence/impact the macro environment has on business operations (LO3)
PESTLE Analysis of Argos
Political factors United Kingdom has witnessed the stable political condition and
the country has a strong control over the politics. However, Brexit
issue has resulted in some chaotic issues in the country’s
environment. But, this does not mean that the Brexit has only
negative influences because it can also result in an opportunity
for the government to introduce some new policies and laws to
overcome the political instability that the country has been
currently facing constantly (Rees-White et al., 2019). In this
regard, antitrust laws related to online services, wage legislation,
taxation, price regulations and trade regulations forwarded as
new rules and policies from the part of the government can help
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stabilize the country's political economy and accordingly help the
company to move to a favourable position.
Economic
factors
UK has witnessed a recession in the year 2008 which put the
country under enormous economic trouble but as of now UK is
ranked fifth in the world economy in terms of GDP (Gudgin et al.,
2018). However, the government has taken several positive
decisions in order to maintain a stable and equilibrium economic
growth of the country. Few economic factors that Argos should
consider in order to uplift its economical conditions involve
uplifting its economic growth rate and education level in the
economy. The company must also keep a check on
unemployment rate, inflation rate, interest rate, discretionary
income, labour costs, comparative advantages and productivity in
the economy.
Social factors The culture of an organisation is heavily impacted by societal
culture and the way they perform various things or
activities .Social factors of a country play a major role for the
business development of the organisation. UK has a population of
around 65.6 million and this shows how the activities of the
people in such a large economy will essentially influence the
entire market or any business of activity in the UK. In this context,
Argos must consider class and power structure, hierarchy,
education level, culture, attitudes and leisure interests of the
entire economy as a whole.
Technological
factors
UK has produced new technologies over the years which are
definitely a huge contribution in the country’s economy. It is highly
technological developed countries and has amongst the list of
leading countries (Geels, 2018). A disruption in technology in
several industries in the UK is observed and retail industry is in
the high position at this point. Instead of this, there are
technological factors that impact the industry. To name a few are
the technological influences on cost structure and service offering
in retail industry. Technological diffusion also changes adoption of
technology in retail.
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Environmental
factors
The UK has the pleasant environmental condition as the
government, charities, newspapers; local councils have taken
several initiatives for the environmental awareness which leads to
a reduction of the negative influence on the economy of the
country (Rees-White et al., 2019). Economic growth of the
country eventually depends on the environmental conditions and
based on Environmental Law 1995. Some of such environmental
factors that Argos must consider is the weather and climate
change of the business area, regulations of air and water
pollution in retail industry and laws regulating environmental
pollution ,attitude towards endangered species and waste
management along with adopting new methods of recycling .
Legal factors UK is a powerful country both politically and economically. The
government is seen to take the correct and appropriate legal
actions. Legal factors eventually play a vital role for the overall
growth of the country. Although the legal framework of the UK is
not effective enough to protect Argos’s intellectual property rights.
Therefore it is very important that before entering into any market,
Argos must consider the antitrust laws in retail, employment law,
discrimination law, health and safety law, data protection and
consumer protection laws.
Table 2: PESTLE Analysis
(Source: Created by the learner)
Changes in the transformation process and overcoming resistance to change
in response to the changing market environment
Organisations such as Argos in the context of this study have gone through various
transformational changes. The various changes in its structures in relation to its laws
and policies that were eventually brought by the government has helped the
company to response to better growth and development and adjust accordingly to
the changing environment of internaitonal market (Keay and Iqbal, 2018). Also
technological factors and social factors have pushed the company to overcome the
resistance it faced and transform into a better retail market.
5. Determine the internal strengths and weaknesses of specific businesses
and explain their interrelationship with external macro factors (LO4)
SWOT Analysis of Argos
Strengths Weakness Opportunities Threats
1. Argos is
in the list
1. The price
structure in
1. Reaching out
markets in
1. International
market is a
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