Unilever's Business Environment: A Comprehensive Report

This report provides a comprehensive analysis of Unilever's business environment, encompassing various aspects such as organizational functions, internal and external factors, and the impact of the macro environment. The report begins with an introduction to the business environment and its comp...Read More

BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK1.............................................................................................................................................1
Covered in PPT...........................................................................................................................1
TASK2.............................................................................................................................................1
P3 Relationship between organisational functions.....................................................................1
TASK 3............................................................................................................................................4
P4 Positive and negative impacts of macro environment upon business operations..................4
P5 Internal and external analysis to identify strengths and weaknesses of Unilever .................6
P6 Interrelate strengths and weaknesses with external macro factors........................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment consists of various macro and micro components which impact
operations of firm directly or indirectly. This includes employees, customers, management,
suppliers, competitors and so on. Public, private and voluntary are various types of organisation
which have distinctive scope and functions (business environment, 2018). These are different
kinds of enterprise, so superiors require to regulate and design systems through which they
deliver goods and services as per demand of people. Present report is based on Unilever which
offer various personal care, food and refreshment items to people. It is executive duty to conduct
PESTEL and SWOT analysis to get information about government of country in which business
activities are being conducted. Through this they are able to get information about customer
requirement and competitors offerings. Thereby, administration require to make strategies and
polices to make employees function effectively; so that they deliver appropriate products and
services to people. Thus company is able to accomplish goals, objective and generate adequate
revenue for their business.
TASK1
Covered in PPT
TASK2
P3 Relationship between organisational functions
Structure of an organisation defines relationship among its various departments,
individuals and their functions. It demonstrates way and extent in which duties and
responsibilities are delegated to individuals. Unilever has a set of its business principals which
provides clear lines of control, responsibility and communication. Functions of any department
in a firm are independent as well as has its different purpose and way to perform. These are
interrelated to each other. As if finance is necessary to start a company then without human
resource, it cannot operate its functions (Teece, 2012). So, there is a supply chain process to
complete a task in a certain period of time. Following are some main key functions of every
organisation:-
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Illustration 3: Organisational Chart
(Sources: Organisational Chart, 2018)
Designing and Production: A company requires to design its organisational structure
and production in an effective way. Designing and production department always engage in
utilisation of resources as well as to reduce wastage as much as possible.
Research and Development: A firm has conducted research and development process in
order to identify new market trends. This identification helps in modification of existing products
or services of a company as well as in improvement of production methods (Zsambok and Klein,
2014). Unilever's research department enables it to cut down the costs for increasing production
which helps to remain ahead from competitors at marketplace.

Finance: It is like blood of an organisation without which it cannot operates the function
in a desired way. Thus, finance department maintain records of capital investment, borrowed,
credits and debits as well as outstanding in market. It provides statements for tax purpose, legal
formalities and audit practices etc. This function also include employees' salaries, loan
repayment and all financial activities. In Unilever, this department helps in devising new
strategies also.
Human Resource: Main asset of a company is manpower, whose contribution help in
achievement of business goals and objectives. It refers to managerial function which includes
planning, organising, staffing and controlling the workforce. In Unilever Company, its human
resource management helps in proper implementation of strategies and policies over workforce
(López-Gamero, Molina-Azorín and Claver-Cortés, 2011). Including above functions, HRM of
this firm also provides remuneration of employees, training and development program, build
morale by giving performance appraisals, preserving their records etc.
Administration:It takes all responsibilities of an organisation to ensure efficient
performance of all departments. Administration acts a connector between management and
employees. It is one of the major key elements which associated with a high level of
productivity. A good administration helps in running a business successfully and legally by
making rules and regulations for all individuals.
Sales and marketing: This department focuses on needs and demands of customers.
They build and implement strategies for increasing sales of a company in a particular market
region. They emphasize on sales target which is assigned to them. Also, make its marketing
process in a better way that helps in increasing sales.
Relationship of these departments and their functions with each other:-
Finance department of a company keeps record of activities that includes cash in it.
Without desired fund, a firm cannot run its operations. Functions of all departments need finance
for its operations. Thus, it allocates funds to all of them with line budget and measures use of
finance required against the same. Research and development department mainly depends on
finance for its operations through which it can identifies market demand and change in trend.
Marketing and sales consider as bridge of relationship with market which helps in providing
customer satisfaction (Wheelen and Hunger, 2011). Function of this division proves beneficial
for both customers and suppliers. Human resource management look after needs of employees. It
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helps in managing the workforce as well as make them able to accomplish goals of a company.
Performance of these departments are monitored by administration of a firm.
TASK 3
P4 Positive and negative impacts of macro environment upon business operations
Organisation operations are affected by macro environment factors which exists outside
enterprise. Political, economical, social, technological, environmental and legal are elements
which are present in external surrounding. As, these forces never remain constant and keep
changing with time. Unilever company offers different brand products of personal care, food,
refreshment and home care to people. So, it is essential that administration acknowledge
transformations that have taken in macro environment components. Thereby, make system
function accordingly through which business make success and growth. Thus, executive are able
to accomplish goals and objectives by making employees perform activities effectively (Kolk,
2016). For this PESTEL analysis is conducted to analyse macro-environment and its impact on
business activities; which is stated beneath:
Political factors: This element specifies that executive require to make policies in
according to country in which operations are being conducted. By acknowledging government
rules and regulations for taxation, trade and other laws. Unilever is having business all over
world; so administration require to make system work in according to regulatory bodies.
Company is able to expand operations due to positive impact of this factor. As in most of
nations, political element are stable and authorities have eliminated trade restrictions to
encourage import and export. But, firm faces challenge as superior has to make changes in
system in according to regulatory bodies legislations; which is negative for them. This has also
impacted in changes in buyer's demand as they get various options.
Economical factors: This element consists of interest, inflation and exchange rate which
influence organisation and its operations. Unilever business depends upon economic conditions
prevailing all over world. Company profitability is determined by income availability with
people. As, developed nations have high growth and economic stability; which is positive for
firm and help in getting adequate sales and revenue for business (Al-Swidi and Al-Hosam,
2012). But, at same time this factor is negative as labour wages are increasing; so superior have
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to set prices accordingly. This will impact upon sales of enterprise due to availability of income
of people.
Social factors: This component includes population, education, lifestyle and culture
which executive should consider while offering products and services to people. For this, market
survey is tool used to evaluate trends and customer demands. Unilever company is delivering
personal care, food and refreshment items; so executive require that they are offering quality
products to people. They need to make changes and innovating goods to enhance sales by
increasing their customer base. As people are becoming health conscious which is positive for
business. But, negative point is that they require to use various promotional devices to sustain
their reputation and share in marketplace.
Technological factors: This element specifies that firm require to implement modern
tools and techniques in system; so that they are able to deliver quality products and timely. In
Unilever, executive are using updated technologies through which they are able to attract
customers. With help of various software, management is able to regulate distribution of
products to stores. This has given positive impact to business, as adequate items are available in
market in according to requirement of buyers (Meiners, Ringleb and Edwards, 2014). Besides
this, as research and development cost have increased which are negative for company. Hence,
customers are able to get creative products and services.
Environmental factors: This comprises elements such as pollution, recycling, waste and
ethical issues. Organisation require that they manufacture products efficiently and utilises
resources through which appropriate offerings are delivered in marketplace. Unilever company
offers quality food and refreshment items to people. As interest rate is increasing, so executive
are able to launch various sustainable programs to attract customers. This is positive for business
functionality; but if resources are not used efficiently then this will affect firm. As superior will
not be able to give adequate offerings to people.
Legal factors: This consists laws and legislations which are framed by government to
safeguard rights of employees; and take care that they get positive working environment in
organisation. Unilever executives are able to enhance image in marketplace as they are using
international patent laws and are providing adequate environment to workforce (Nishitani,
Kaneko, Fujii and Komatsu, 2012). This force positive impact in enhancing company reputation
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in market and to retain employees for longer period. On other hand, if executive don't function
system as per law; then this will have impact on sales and profit of business.
P5 Internal and external analysis to identify strengths and weaknesses of Unilever
Executive require to conduct analysis of internal and external factors; to examine their
influence on business operations. This help them to design system in according to market
situations, so that they are able to deliver adequate products and services to people. Unilever
which is offering various brands of personal care, food and refreshment items to customers.
Company require that they deliver quality offerings through which they are able to attract people
and retain them for longer period. So, administration require conduct decision making process
through which appropriate choices are made; which are beneficial for firm. For this SWOT
analysis is best tool which administration require to conduct to assess firm functionality.
Executive conduct analysis of internal factors to acknowledge potentialities of system in
according to market opportunities. By evaluating strengths and taking care that appropriate tools
and techniques are being used and employees are functioning effectively. Thereby, taking care
that weaknesses are take care (Onetti, Zucchella, Jones and McDougall-Covin, 2012).
Strengths: In Unilever, administration have set up research and development team which
have information about people demand and check that quality products are being delivered to
customers. By making workforce competent that they have adequate information about product,
features and benefits; which are to be communicated to people to attract them and make them
purchase their items.
Weaknesses: Unilever, superior require to anticipate problems and obstacles which may
be impacting business operations. Thereby, they make changes in system and implementing
updated tools and techniques through which company is able to make employees function
properly.
Administration require to conduct market survey to acknowledge customer demand and
get information about competitors offerings. This help them to take care that they offer products
and services accordingly so that market opportunities are utilised and company is able to position
themselves superior than other firms (Pham, Segers and Gijselaers, 2011).
Opportunities: With time, people tastes and preferences are changing, so executive of
Unilever require to innovate and make alterations in products through which they are able to
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deliver offerings accordingly. As, company is operating globally so they are able to enhance
customer base by providing healthy items to people.
Threats: Unilever require to offer quality items to customers, through which superior are
able to retain them for longer period. As P&G, Nestle are rival firms which are offering similar
products, so it is necessary that executive make system function accordingly and setting
competitive prices for items.
P6 Interrelate strengths and weaknesses with external macro factors
In organisation, executive require that system function effectively through which they
deliver products and services as per requirement of people. By conducting market survey to
acknowledge customer's demand and also get information about competitor's offerings (Welter
and Smallbone, 2011). As in case of Unilever, administration require to analyse elements which
are present outside firm. Thereby, ascertain strengths and weakness of system through which
they can deal with macro environment factors. So, administration acknowledge strengths and
weaknesses of system and conduct PEST analysis. Thereby, correlating it to compute that
company operations take place as per market conditions.
Political factors: It includes those factors like political rules and regulations, trade laws
etc. which affect operational activities of organisation. Therefore, it is essential for all companies
to formulate structure of organisation and develop strategies as per legal laws. function in
according to government policies of taxation and trade.
Positive Impact: By running business operations as per political laws provides benefits to
Unilever to run business long time.
Negative Impact: As Unilever operate business in many countries, therefore, trading policies of
each nation will directly impact on profitability of this company in negative manner.
Economical factors: It includes factors like fluctuations in interest rate, inflation and
deflation period, exchange rate of currency and more. Therefore, any change in such rates, will
directly affect profitability of business.
Positive Impact: As UK has stable economic condition and improve much better after Brexit so,
it reflects good purchasing power of people. Hence, this will provide opportunity to Unilever to
improve its sales performance by offering high quality of products as per demand of customers.
Negative Impact: But due to fluctuations in exchange rate of currency, import-export activity
of Unilever can be affected.
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Social factors: This factor majorly impact on brand image of a company. Therefore,
firms are require to deliver goods and services as per requirement of people.
Positive Impact: As Unilever company provide personal care, food, refreshment and home care
items to customers. So, it is necessary that superior are using promotional tools to advertise
information about their offerings. This will help firm to attract people and retain them for longer
period, as they get quality items. Management even require that they make improvements in
offerings so that they are able to compete with other brands.
Negative Impact: Since Unilever doesn't participate much in CSR activities as well as rate of
products also high. Therefore, this would impact negatively on brand image of business and
affects sales performance also.
Technological factors: Innovation and latest technology give various opportunities to
organisations to conduct their business operations in more efficient manner. It also helps in
serving high quality of products.
Positive Impact: Managers of Unilever are required to implement latest technology in working
system, it will help in delivering products worldwide in faster manner. Moreover, it also give
advantage to marketing its products and provide awareness among customers about services. It
will help in increasing sales performance of company.
Negative Impact: Making modification in system and implement of new technology sometime
arise employee resistivity and high labour turnover.
Henceforth, it can be concluded that macro environment factors; political, economical,
social and technological are to be considered by executive while designing system. They require
that company work in according to government laws and market conditions. For this market
survey is conducted to enquire about customer demand and offerings of competitors. Thereby,
implementing modern tools and making strategies so that employees function effectively. So,
this help firm to utilise resources efficiently and deliver adequate products to people. This help
company to attract buyers and retain them for longer period so that adequate profit is being
generated by superior.
CONCLUSION
From the above report, it can be comprehended that in market there are different types
and size of organisation which consists diverse scope and purposes. Public, private and voluntary
are various forms of firms which are different with each other in terms of operations and
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functionality. Executive frame goals and objectives, thereby take care that resources are utilised
efficiently. Thereby, they require to organise members in various departments such as finance,
human resource, production and marketing. After this, administration require that they conduct
external and internal analysis to acknowledge their impact on business operations. Through
SWOT analysis, superior get information about strengths, weakness of firm; and opportunities
and threats present in marketplace. Besides this PESTEL analysis which includes political,
economical, social, technological, environmental and legal factors; which executive require to
consider while conducting business operations. By correlating macro environment elements with
strengths and weakness; thereby making strategies and policies so that system function
effectively. Hence, executive are able to retain customers by offering them adequate products
and services. This benefit firm to generate adequate profit and accomplish its goals and
objectives timely.
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REFERENCES
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Online
business environment. 2018. [Online]. Available through:
<http://www.yourdictionary.com/business-environment>.
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