Business Environment Analysis: Unilever Plc Report - Semester 1, 2024

This report provides a comprehensive analysis of Unilever Plc's business environment, covering its organizational structure, functions, and the impact of various internal and external factors. The report begins with an introduction to the business environment, followed by an explanation of different types of organizations (public, private, and voluntary) and their legal structures, along with an analysis of their size and scope. It then examines the interrelationship between different organizational functions, such as finance, marketing, and human resources, and their impact on the company's objectives and structure. The report further explores the positive and negative impacts of the macro environment on business operations, applying PESTEL analysis to assess political, economic, social, technological, environmental, and legal factors. An internal and external analysis of Unilever Plc identifies its strengths, weaknesses, opportunities, and threats, with a focus on the influence of macro and micro factors on decision-making, concluding with critical evaluations and recommendations.

Business and Business
Environment

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
TASK 1............................................................................................................................................1
P1. Explanation of different types and purpose of organisation and their legal structure...........1
P2. Explanation of size and scope of different organisation.......................................................3
M1. Analysation of structure, size and scope of different types of organisation and their link to
business objective and offering of organisation..........................................................................3
TASK 2............................................................................................................................................4
P3. Explanation of relationship between different organisation function and their link with
objectives and structure...............................................................................................................4
M2. Analysation of advantage and disadvantage of interrelationship between different
organisation function and their impact on organisation structure...............................................5
D1. Critical analysation of different type of business structure and interrelation with different
function........................................................................................................................................5
TASK 3............................................................................................................................................6
P4. Identification of positive and negative impact of macro environment on business operation
.....................................................................................................................................................6
M3. Application of PESTEL analysis on macro environment in organisation...........................8
TASK 4............................................................................................................................................8
P5. Internal and external analysis of specific organisation for identification of strength and
weakness......................................................................................................................................8
P6. Explanation of strength and weakness of interrelation with external macro factors...........10
M4. Application of SWOT analysis and its influence on decision making...............................12
D2. Critical evaluation of impact on macro and micro factor on business objectives and
decision making.........................................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Business environment refers to environment in which organisation carry out their business
activities. It includes various internal and external factors which create positive and negative
impact on enterprise (Bruijl, 2018). Internal factors are those which are present within
organisation and organisation has proper control over these factors. These include employees,
working environment, Leadership, etc. External factors are those which are present outsider
business environment and organisation does not have control over these factors. It includes
factors related to political, economic, legal, environmental, social and technological. These
factors create impact on business in different ways and to overcome these factors enterprise need
to ensure proper planning. This project report includes study of Unilever Plc which is a UK
based organisation. Unilever plc is one of multinational organisation which are providing
consumer goods in retail industry. Company is established in the year 1929 by Willian Lever and
providing their service in different parts of world including Asia, Europe, UK and many other
countries. Enterprise is providing product related to personal care, health care, pharmaceuticals,
food items and other consumer products. This project report includes explanation of different
types, size and scope of organisation. It also includes interrelationship between different function
in organisation, positive and negative impact of macro environment on business and strength and
weakness of business and their relationship with external environment.
MAIN BODY
TASK 1
P1. Explanation of different types and purpose of organisation and their legal structure
Public sector organisation: Public sector organisation are those which has government control
over it. It is not a part of private organisation and is controlled by government (Dima, Hadad and
Luchian, 2017). Example of private sector organisation is BBC which is British Broadcasting
Corporation and is run under control of government of UK. This organisation is providing
various news to public about current situation.
Purpose: Main purpose of British Broadcasting Corporation is to conduct various research
activity to create awareness in people living in UK.
Objectives: Objective of BBC is to provide information, entertainment as well as education to
people through programmes as well as services.
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Legal Structure: Public sector organisation consider rules and regulation of local government,
state government as well as central government. British Broadcasting Corporation is considering
rules and regulation of state government as it helps them t provide relevant information to their
target audience.
Private sector organisation: Privates sector organisations are those which is conducted by an
individual or company for purpose of making profit. This type of organisation does not control
by any government (Franklin and Marshall, 2019). Main objective of this types of enterprise is to
earn more and more profit. Example of private sector organisation is Unilever Plc which is large
size organisation conducting their operation in different countries. Main objective of company is
to provide their services in all over world and to earn more profit.
Purpose: Purpose of Unilever to conduct their operation to provide their product and service to
their customer which are present in different parts of world within affordable prices.
Objectives: Main objective of company is to increase satisfaction level of their customer with
their product and providing them different range of product as well as services.
Legal Structure: There are various types of legal structure in private sector organisation and it
includes Private Corporation, unincorporated as well as corporate structure. Unilever plc is
adopting private corporation legal structure and providing different range of consumer goods to
their customer in all over world.
Voluntary organisation: Voluntary organisation are those which is not conduct for making
profit or controlled by government but it is different from both private and public sector
organisation (Eling and Schaper, 2017). This type of enterprise is conducting their operation by
trustees as well as other member and their main object is to service to benefit of society.
Example of voluntary organisation is Oxfam which is one of large organisation working against
global poverty.
Purpose: Main purpose of Oxfam organisation is to provide solution for problem of poverty in
different parts of world and to provide equality to people.
Objectives: Objective of Oxfam is to provide equal rights to people and improve their living
standard.
Legal Structure: Legal structure for voluntary organisation include unincorporated institution,
trust, non profit organisation. Oxfam is adopting trust as their legal structure.
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P2. Explanation of size and scope of different organisation
Basis BBC Unilever Plc Oxfam
Size British Broadcasting
Corporation is one
of large organisation
in broadcasting
services. It has
around 22000 staff
who are working for
company.
Unilever plc is one
of multinational
organisation is
largest retailer in
public sector
organisation
(Gaganis, Pasiouras
and Voulgari, 2019).
They have around
1550000 employees
working all around
world.
Oxfam is one of
non-profit
organisation. They
have around 5000 to
10000 employees
working to
overcome global
poverty.
Scope This organisation is
a public sector
organisation which
is directed by
government of UK.
Organisation has
governance as well
as corporate
structure.
This enterprise is
part of private sector
organisation which
is founded by
Willian Lever.
Company has
product based
divisional
organisation
structure.
It is part of
voluntary
organisation. They
are independent
organisation which
has global
governance
structure.
M1. Analysation of structure, size and scope of different types of organisation and their link to
business objective and offering of organisation
Size of company and their structure helps them to achieve their organisation objectives. If an
organisation is multinational, they have adopted different organisation structure from small
company which helps them to attain their business objectives (Gebauer, Haldimann and Saul,
2017). Private organisation is working for earning more profit and their main objectives to
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increase their market share. Whereas public organisation is a non-profit organisation which are
controlled by government. They size and structure depend on government policies and strategies.
These helps company to attain their objectives and allow them to better serve their target market.
TASK 2
P3. Explanation of relationship between different organisation function and their link with
objectives and structure
Organisation structure: Organisation structure refers to a system which include direction of
activities in an enterprise in order to attain goals and objective of company. It includes clear roles
as well as responsibilities of people (Haggard, Maxfield and Schneider, 2018). This structure
also shows flow of information between different level of firm. Unilever Plc has adopted
divisional organisation structure in their enterprise. This this type of organisation structure
division has prepared as per function of company. It includes marketing, human resource,
information and technology, finance and accounts and many more.
Mission: Mission of Unilever plc is to make people feel good, look good and get many more out
of life. They want to invest in local economies to develop various skills in people who are
present insider and outside of their organisation. They are running a programme through their
business to promote empowerment, hygiene, nutrition an environmental awareness.
Objectives: Objective of Unilever plc is to focus on food product, household product and
personal care product. Company want to increase their market share with shift their focus on
luxury products.
Interrelation between function of Unilever Plc together to ling with its business objectives
are as follows:
Finance and marketing: Finance is one of function which is related to preparing financial
information of company. This division includes planning of financial need of company,
arrangement of funds to meet necessity of company (Hakanen, Helander and Valkokari, 2017).
This function is related to with other function like marketing. As finance department is one
which prepare budget for whole organisation including marketing and other promotional
activities. Data collected by marketing activity and demand analysation helps finance department
in making different strategies related to finance and budget of company.
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Human resource and finance: Human resource is one of debarment of company which recruit
and select employees for completion of work of company. Their main object is to hire and retain
employees in order to meet goals of company. This function is related to finance function of
company as human resource affect cost of company. Budget prepare by finance department
allow human resource to spend to hire new employees.
M2. Analysation of advantage and disadvantage of interrelationship between different
organisation function and their impact on organisation structure
Advantages Disadvantages
 Interrelation between different function
and department in organisation if
Unilever plc is important as it helps in
ensuring flow of communication
between different function. This
communication helps them to share
important information between
different departments (Huang, Lee and
Chen, 2019). For instance, marketing
department needs funds for
implementing of marketing strategies
they can ask to finance department
which helps them by providing funds.
 Interrelation is also helpful to achieve
common goals of organisation as all
activities carry out in an enterprise for
attainment of business objectives of
company.
 This interrelation between different
department some time cause conflict
between them. Reason behind this
conflict in interest of organisation as
department are focusing on completion
of their divisional goals and target
which create problem for business for
attainment of organisational goals.
 This interrelation create competition
between different department. This also
result in sharing personal information
relation to a particular department of
company.
D1. Critical analysation of different type of business structure and interrelation with different
function
From above mentioned information, it can be analyses that there are various types of
organisation which are conducted their operation for different purposes. Private organisation
conducted their operation in market to increase their market share and to earn more profit from
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their customers (Ivanovich, 2020). Whereas public sector organisation is non-profit organisation
which run their business for satisfaction of their customers and providing the better experience in
life. Voluntary organisation on other hand are conducted for social welfare of people of society.
These enterprises have different function in their company including human resource, finance,
accounts, marketing, information technology which helps companies to attain their main
business objectives.
The link between design and culture can have a physical impact if the buildings do not build
a healthy and thoughtful work culture at which point the organization does not achieve its goals
and cannot get through research. . The design of the group should be appropriate to
accommodate the big new culture and the social outlook should be able to strengthen the
construction and maintain the results of the exercises in a safe and beneficial way. In case we see
corporate culture as somehow a way in which the senior management of the organization tries to
impress their own organization because it describes the corporate culture ordered and
coordinated. Organizations with a better and more co-ordinated culture try to maintain the
distance between senior management and youth roles, but in the 21st century it is all about
collaboration. Organizations should promote a symphonic and collaborative culture.
Discus the factors which influence individual behaviour at work
There are several components that affect the workers during grinding. These components are
rooted organizational structures, order, culture, values, points, objectives, benefits, and control
structure. Staff seeks support from the existing organizational structure. Given the lack of a rigid
structure, employees cannot feel better and have a strong sense of belonging to senior managers
in their work, and so lose interest in the job over time. In addition, if a culture of character and
training is not well defined in the employees of the organization, the employees try to get away
from the work and the lethargic mind is created in the long run. -time. Without a clear set of
guidelines in the organization there may be a waste of time and resources due to the
inconvenience of delays and work coverage. In order to ensure that the organization has good
business acumen, employees are also aware of the security and joy of the organization and strive
to achieve the organisation's goals and objectives.
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TASK 3
P4. Identification of positive and negative impact of macro environment on business operation
Macro environment: Macro environment are those environments which include factors
that are present outside business (Kasseeah, 2016). These factors create impact on business and
business does not have control over these factors. Unilever Plc include various factors which
create impact of their organisation and these are as follows:
Political factors: Political factors are those factors which include level of interference of
government in operation of organisation. It includes factors life trade barriers, government
stability, trade restriction and many more. These factors create various impact over business of
Unilever plc.
Positive impact of Political factors: Government of UK provide support to organisation
who are conducted operation their country. Political structure of UK is stable which provide
benefit for business as it creates opportunity of growth for business.
Negative impact of Political factors: Political issues related to Brexit create problem for
business of Unilever Plc as government has made various changes in rules and regulation for
business organisation.
Economic factors: Economic factors are those which are related to economic growth of
country and affect cost of operation of business (Khajeheian, Friedrichsen and Mödinger, 2018).
It includes factors like inflation rate, interest rate, exchange rate, wages rate and many more. It
creates impact various impact of cot of operation of Unilever plc.
Positive impact of Economic factors: Increasing wages rate in UK create positive impact
over business of Unilever Plc as it increases buying power of people living in that country.
Growth rate in UK is also high which is also beneficial for business of organisation as demand of
consumer goods in developed countries are high
Negative impact of Economic factors: Increasing wages rate in UK create negative
impact on business of Unilever Plc as it increases total cost of enterprise. This factor affects total
cost of operation of company and can create negative impact on profitability of business
Social factors: Social factors are those factors which are related to culture, vales, belief,
education level, income, population of country. These factors affect demand of particular product
in a country. It creates impact on business of Unilever Plc in various ways.
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Positive impact of Social factors: Social factors crate positive impact on business of
Unilever plc are company is providing health care product and there is increase in health
consciousness in people living in UK (Miao and Wang, 2016). This fact helps to create demand
of health care product of company in market place.
Negative impact of Social factors: Social factors create negative impact on business as it
can create negative impact over health of people living in country. People of country does not
accept product which can create problem for business of Unilever Plc in that country.
Technological factors: Technological factors are those which are related to research and
development, automation and innovation (Nguimkeu, 2016). These factors affect entry of new
company within industry. It also provides competitive advantage to a company. It creates impact
over business of Unilever plc in various ways.
Positive impact of Technological factors: Increasing automation create positive impact
over business of Unilever Plc as it helps to save cost of company and also save efforts and time
of their employees.
Negative impact of Technological factors: Increasing research and development create
negative impact on business of Unilever Plc as it provides competitive advantage to other firm
and increase competition within industry.
Legal factors: Legal factors are those which are related to laws and regulation. It includes
various laws like health and safety law, consumer protection law, discrimination and many more
which crate impacts over business of Unilever plc (Moşteanu, Faccia and Cavaliere, 2020).
Positive impact of Legal factors: Legal factors create opportunity for business of
Unilever plc as increasing environment regulation allow company to follow measure which
protect environment. This increase image of company in market place.
Negative impact of Legal factors: It create negative impact on business of Unilever Plc as
increasing awareness of consumer protection laws company as to provide increase quality of
product and service which increase total cost of enterprise.
Environmental factors: Environmental factors are those which are related to environment
safety, environment standards and pollution and waste (Niedermeier, Wang and Zhang, 2016). It
creates impact on business of Unilever plc in various ways.
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Positive impact of Environmental factors: Following environment safety measures in
business create opportunity for business as people living in UK has increasing interest in
environment. This will create good image in minds of their prospect customers.
Negative impact of Environmental factors: Increasing awareness of people related to
environmental issues create negative impact on business of Unilever Plc. Adopting environment
safety measure increase cost of company which effect on profitability level of company.
M3. Application of PESTEL analysis on macro environment in organisation
From above mentioned PESTEL analysis, it is analysed that business of Unilever Plc need to
focus on those areas which is affected by external factors. All external factors do not create
negative impact on their business (Reeves, Levin and Ueda, 2016). Some factors create
opportunity for their business as increasing in wages rate, support for government for expansion
of business operation, advancement of technology. But these are some factors which create
negative impact on operation of company. Managers of company need to prepare various
strategies to overcome these factors. PESTEL analysis helps business for identification of these
factors in advance so business can be prepared themselves to face these issues.
TASK 4
P5. Internal and external analysis of specific organisation for identification of strength and
weakness
Internal analysis: Internal analysis is one of those analysis which include identification
of various factors which are present in company. It includes identification of strength, weakness,
opportunity and threat for business (Rialp-Criado, and Komochkova, 2017). Strength provide
opportunity for business whereas weakness work as threat for Company. SWOT analysis of
Unilever plc include identification of various factors which affecting their operation in market.
These factors are as follows:
Strength Weakness
 Unilever Plc is providing diverse
product to their customers as company
is providing product related to food,
health care, personal care and home
care.
 Company is using plastic for packing
their product. As people living in
different countries are aware for
environment which create problem for
company (Schwepker and Ingram,
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 Company is providing their product in
different market in different part of
world. These areas include Asia, UK,
Europe, America and other parts of
world.
 Company is using effecting marketing
and their marketing abilities provide
them competitive advantage in market
place.
 Organisation is leader in terms of its
sustainability.
2016).
 Organisation is conducing research and
development for development of new
product and copy products offered by
competitors.
 Enterprise does not have channel to sale
their product and service to their
customers which increase their cost.
 Operation of company is depended on
exchange of currency which create
problem for company.
Opportunity Threat
 New emerging market create demand
for product as well as service offered
by company in market place.
 There re various new product
categories offered by company which
make them different from those of their
competitors (Saleh and Watson, 2017).
 Company is using digital channel
which helps them to reach globally to
their customers. These channels are
helpful to reduce cost of company.
 Acquisition and disposal strategy of
company provide various opportunity
to them as it provides strength to
competitive position of company.
 Political uncertainty in UK create
problem for company as government
has made various changes in rule and
regulation for business.
 Preferences and taste of consumer are
changing rapidly which decrease
satisfaction level of customers with
product and service offered by
company.
 Covid-19 is also creating problem in
economy of various countries and also
create problem for company as
government has put various restriction
over business organisation.
 Increasing competition in retail
industry is also a threat for business of
Unilever plc.
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