Business Environment Analysis: Yorkshire Bank and Ahli United Bank

This report provides a comprehensive analysis of the business environment, focusing on Yorkshire Bank and its client, Ahli United Bank. It begins by categorizing and explaining the types and purposes of private, public, and voluntary organizations, using examples like the National Health Service (NHS) and Oxfam. The report then examines the size and scope of these organizations, highlighting their visions and missions. It also delves into the interrelation between different organizational departments and their linkage with organizational objectives, using an organizational chart as a reference. Furthermore, the report explores the impact of micro-environmental factors and conducts an internal analysis (SWOT) to identify strengths and weaknesses. Finally, it assesses the interrelation of macro-environmental factors with organizational strengths and weaknesses, providing a holistic view of the business environment. The report concludes with a summary of key findings and references cited.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1: Types and Purposes of private, public and voluntary organisation.................................1
P2: Size and scope of different organisations.........................................................................4
TASK 2............................................................................................................................................5
P3: Interrelation between different organisational departments and their linkage with
organisational objectives........................................................................................................5
TASK 3............................................................................................................................................6
P4: Impact of micro-environmental factors............................................................................6
TASK 4............................................................................................................................................8
P5: Internal analysis of organisation for identification of strength and weaknesses..............8
TASK 5............................................................................................................................................9
P6: Interrelation of macro-environmental factors with organisational strength and weaknesses
................................................................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business is called as an economic system in which the goods and services are provided for
earning money. Furthermore, it is a function which is performed by the number of employees
for achieving the organisational goals in allotted time frame (Chavis, 2011). On the other hand,
the business environment is defined as a location in which all these functions are performed in
proper manner. The chosen organisation for this assignment is Yorkshire bank who is providing
financial services in UK with the headquarters in Leeds, England and the other taken firm for
this report is Ahli united bank plc which is a client of this bank. This assignment will discuss
about the various kinds of firms along with their size and scope. The interrelation of functions of
these kinds of firms with positive and negative impact of the macro environmental factors on the
business operations will also covered in this report. Strength and weakness of the firm along with
their interrelationship with the external macro environmental factor will also discuss in this
report.
TASK 1
P1: Types and Purposes of private, public and voluntary organisation
In the present scenario, there are several kinds of firms who are performing their business
activities for achieving their preset objectives with the help of this, firm can easily contribute in
building wealth and economy of a nation. The economy and wealth of the UK nation is mostly
depends on this kind of firms because their larger investment and tax duty is used by the
government for developing the economic condition of nation. Types and purposes of various
firms are defined as under:
Public organisation- These kind of firms provides their services at very low prices to its
customers. These organisations are regulated or controlled by the government authorities. For
this kind of organisation the taken firm is National health services (NHS) which is the largest
public organisation in terms of the number of employees and providing health services in the
world. This organisation comes under Quaternary sector. The shares of these kind of firms are
freely sold to individuals of the nation (Aithal, 2016).
Purposes of National health services
 To Provide Better quality in services to patients.
 To Make effective quality in the services so that the other customers can easily attracted
towards the services of firm.
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 To Increase the awareness about the health services in the people of nation (Love, 2011).
 To provide medical check-up services along with better quality to patients.
Legal structure
 Local Authorities – they are responsible for controlling and regulating a small part of
area such as a district or a town
 State Authorities – These authorities have obligations to manage and maintain law in the
state. It has responsibility to solve the conflicts and issues which are arises in a state.
 Central Authorities – These authorities have to control and monitor all the economy of
nation. It has a duty to to maintain law and order in whole country.
Advantage and disadvantages
Advantage Disadvantages
 These firms Charges low prices on their
services and products as compared to
private organisations.
 These organisations also provide
essential facilities such as education,
health, free at reduced prices (Klapper,
2011).
 These firms ensures the efficiency
control in their industry.
 Government bears the loss of such
firms. If they will not bear then it can
leads to higher taxation.
 Several of these firms work in
monopolies due to which these firms
less focus on efficiency improvements
and innovation.
Private organisation – Shares of these firms are not freely sold to public and there is less
interference of government in the operational activities of these firms. If the owner of firm is
resident of UK therefore, The firm have to follow the rules, regulations, plans and policies which
are created by the government of UK. This is more profitable for the nation because these kinds
of firms are providing a huge employment in the nation due to which the wealth and economic
condition of the nation are increased. This bank comes under Quaternary sector.
The private organisation is chosen for this report is Ahli united bank which is providing
financial, Banking and Mortgages services across the UK. (Cavalcante, 2011). The bank was
founded in Bahrain in the year of 2010. The organisation has 35 stores in all over the UK and
more than 3000 employees who are providing their services in their stores.
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Purpose of Ahli untied bank
 To increase the awareness in the customers about banking products
 To increase the standard of living of residents of the UK nation.
 To support the government for protecting the natural resources of nation.
Legal structure of private organisation
Partnership - In this structure, there are two parties who joins together for performing
activities in order to achieve a common objective. This joint venture helps them in sharing profits
and loss.
Sole proprietorship – This structure is an easy form of private organisation. These kind
of organisations are regulated by a single individual without sharing any profit or loss of firm
with anyone (Cavalcante,2012).
Limited firm – It includes two types of structure in which first one is called guarantee
and the other one is called share. The owner have full control on the business operations and they
have to face less liabilities because the government shareholders have more liabilities than the
owners.
Multinational companies- these companies operates their business operations in more
than one country with having headquarters in a specific country. The headquarter is responsible
for regulating and controlling supply system of the company.
Global company – Under this structure, a firm spread its goods and services in several
nations in all over the world. The Headquarter has duty to make policies and strategies for
spreading awareness about product.
Transnational company – In this structure, companies also operate their business
functions in more than one nation but their headquarter is not specific.
Advantage and disadvantages
Advantage Disadvantages
 Major disadvantage is that the owner
has the control of firm.
 Such firms are usually limited liability
due to which every member of the firm
enjoy this facility.
 Transfer of shares is not done which is
a major disadvantage.
 Also the shares of such firms are not
quoted in stock exchange shares.
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Voluntary or Non profit organisations
This type of organisations are owned or handled by the large number of volunteers. These
volunteers may be industrialists, Business tycoons, Ministers etc. the main objective of
formulation this kind of organisation is to welfare of residents. They are not focusing on gaining
the profits therefore, these firms are called NPO. Before starting any activity in the nation, the
volunteers have to take permissions from the authorities of government (Macintosh, 2010). The
most appropriate example of this kind of organisation is Oxfam which is a voluntary firm and
their main objective is to fulfil the needs and demands of needy and poor people. It is formed as
a charitable trust whose main objective is to remove the poverty from the world. This firm comes
under Quaternary sector.
Purpose of Oxfam
 Providing the suitable solutions to the needy people so that poverty can be removed
 To provide the essential facilities to poor residents through which their standard of living
can be enhanced(Ulhøi, 2016).
 Spreading awareness about the importance of education by organising different kind of
programmes and campaign.
Legal structure
Trust – This kind of structure have no need of any type of membership this is formulated
on the basis of trust.
Association – This is a structure in which various individuals work together for
achieving a common objective without earning any kind of profit.
Advantage and disadvantages
Advantage Disadvantages
 Employees of such organisation are
committed towards the organisational
goals.
 These organisation provides intrinsic
benefits to the employees.
 The major disadvantage is that funding
gathering is a major challenge for the
firms.
 Social pressure is often high on such
firms due to involvement in extreme
cases and situations.
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P2: Size and scope of different organisations
The three firms which are discussed in this report like public, private and NPO. As their
products and services are different from each other so there size and scope are also different in
nature which can be more understood by as under:
Ahli united bank (private)
Size - This is the leading bank in the nation and they have more than 35 branches in the
world. The firm is providing their services in more than 5 countries and they have more than
3000 employees who are providing their services in these nations. (Cavalcante, 2011).
Scope – The Bank is leading and most respective bank because their plans and policies
are effective in nature. The bank is a part of Yorkshire bank plc. which is a leading banking
group in the nation(Avramenko, 2011).
Vision – The management have made effective strategies so that the customers are
attracted towards the services of bank (Aithal, 2015).
Mission – The managers of bank wants to expand their banking services across the world
for this, they have made effective strategies so that the loyalty of customers can be gained in
proper manner (Helms, 2010).
National health services (Public organisation)
Size- This is a leading public organisation in which 1.5 million workers are working and
more than 3 lac regular patients who comes regularly for taking health treatments in the firm
(Roederer, 2011).
Scope - The scope of firm is very high as the firm is related with the health services due
to which their good brand image is build in the mind of patients all over the world that defines
growth and sustainability of the firm (Reinhardt, 2010).
Mission - The main objective of this firm is to providing better medical services to their
patients for this, they have made effective strategies so that the well being of the patients can be
maintained by their efficient employees in a proper manner (Childe, 2011).
OXFAM (NPO)
 Size – Oxfam is biggest voluntary organisation in UK which has 20 trust and 1200
branches in the world. The firm has 19000 volunteers who are providing their services
for improving the livelihood of poor people (Macintosh,2010).
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 Scope- Its scope is interrelated with main objectives of firm so that, the workers are
aware from their roles and provide maximum contribution on their given task. The
volunteers of Oxfam are organising campaign for spreading awareness about education in
the people of nation and also run charitable trusts for providing essential needs to the
needy and poor people of nation. The government and businessmen of the nation are
providing donations and subsidy to the firm which makes sustainability and growth of
firm (Teece,2010).
 Vision – Firm's main vision is to gave effective services to poor individuals therefore, the
poverty can be removed from country in effective manner.
 Mission – the main motive of this firm is to provide necessary services to poor residents
of the nation so that they can easily spend their livelihood (Helms,2010).
TASK 2
P3: Interrelation between different organisational departments and their linkage with
organisational objectives
Illustration 1: Organisational Chart of Company
Source: Organisational Chart of Company. 2013
The success and growth of a firm depends upon their various functions. The management
is responsible for implementing the plans and policies for every department for getting the
combined efforts from them. Yorkshire bank needs to understand the importance and roles of
respective departments in achieving the desired organisational goals. The taken clients of
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Yorkshire bank are Batter sea power station and Oakdale Care Group. Both Batter sea and
Oakdale are following matrix organisational structure. Matrix organisational structure refers to
the reporting relationship which is setup as a matrix instead of traditional hierarchy. Employees
needs to report to both functional manager and product manager in this type of structure.
HR department is responsible for workforce hiring, workforce planning, appraisal on
performance, determination of remuneration etc. For effectively performing their function of
hiring the knowledgeable candidates, they needs the support from marketing department. The
marketing department advertise the vacancies and job position of the firm to attract talented
candidates for their firm. Through this department, HR department of both Batter sea power
station and Oakdale Care Group gets the necessary support in recruiting knowledgeable
candidates. For example: Candidates having necessary skills and knowledge regarding the
marketing tools and methods will help the both clients firm of the bank in promoting their
products and services to a large number of targeted people for effectively accomplishing the
objectives of the firms (Starr, 2014).
Finance department is responsible for maintaining and managing the financials
transaction from different sources such as financial institutions, banks etc. It also helps the other
departments of both Batter sea power station and Oakdale Care Group in performing their work
with required efficiency by providing sufficient budget and funds. For example: marketing
department needs funds for promotion on TV, Newspaper etc. These funds are provided by the
finance department for achieving the sales target which will ultimately improve the financial
stability of the firm and bank can achieve their desired goals and aims effectively (Khan,2015).
Production department is responsible for producing the quality based goods using the
advanced technology and equipments. These equipments are purchased with the help from
finance department. Similarly, marketing department provides the insight regarding the needs
and preferences of the customers to production department. Through this, the production
department of both Batter sea power station and Oakdale Care Group can produce the products
according to the demands of their customers (Teece, 2017). Through the help from finance and
marketing department, production department can perform their functions properly for meeting
the desired target and objectives of organisation.
Marketing department is responsible for building the brand image of the firm by using
marketing and promotional techniques. The tools which are essential for marketing are expensive
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and also this department needs support from the finance department for purchasing the tools.
When the marketing department of bank has the necessary tools and budget, they can effectively
work for achieving the desired organisational goals (Vashneya, 2017).
So, the various departments of the both client firms i.e. Batter sea power station and
Oakdale Care Group can work together for achieving the desired goals and objectives of the
firm. The efficiency of the departments increased when working with each other in an effective
manner. So, the interrelation among the different departments is essential for sustaining in the
market.
TASK 3
P4: Impact of micro-environmental factors
There are two types of environment in which every company is working i.e., external and
internal environment. Internal factors consist of strengths and weakness of Yorkshire bank and
how they can enhance it so to maximise their productivity and efficiency in coming future
(Griffin, 2013). On the other hand, external consist of factors which can not be controlled by
company and they have to modify their strategies and plan accordingly. Analysis of Macro
environment is given below with functional example of Yorkshire bank.
Political environment: It refers to all the factors which are related to political conditions
of UK like political stability, taxation policies, trade restrictions etc. As Yorkshire bank is from
UK only so rules and regulation made by them is according to them only. So it can be said that
this aspect is supporting bank to grow in future. But after the Brexit, employment laws have
changed which are affecting their profitability in a negative way. For instance, immigrants from
outside UK has no rights to work in any companies which means that company have to hire more
employees within the country which incurs acquisition cost for bank. Moreover training cost will
also incurs to a certain level which will attract more funds for bank. Apart from that, sterling is
getting weaker due to increase in inflation rate in UK which leads to high interest repo rate for
Yorkshire bank (Reinhardt, 2010). With the help of this firm, company can easily takes support
from the local employees in decision-making which will helpful for the firm in making perfect
decisions. Whereas, the brand image of firm can be harmed by the employment laws because the
local employees are not skilled and experienced in the banking sector.
Economic environment:
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It includes all the factors which is directly linked with the economic conditions of country
like inflation rate, interest rate, cost of capital currency fluctuations etc. In recent past bank of
England has raised their repo rate to 0.75% which depicts that banks have to lower down their
lending rate to a certain level (Bhattacharya,2010). Moreover due to increase in inflation rate,
bank can not easily lend to different types of customers which makes their profitability hampers
in a negative way. But on the other side, if sterling will perform better then it will generate more
profits for company due to interest they will get from reserves. As the firm is acquired by the
leading organisation of banking sector which helps them in more investment for expanding the
services. Whereas, the dependency level of the firm will be enhanced in future they have to take
permissions before making any decisions.
Sociological environment:
Sociological factors includes age distribution, population, growth rate, latest trends etc.
Though there are large number of populations within UK which makes the market attracting for
the outsides and new comers which leads to high numbers of customers for bank. But on the
other side, bank profitability is affecting due to grievances of customers in a negative way. For
instance, UK government has now bring the regulations in the market in which every bank
operating within country have to disclose all the information related to fee data and performance.
It would assist customers to compare financial results and offering of all the banks and choose it
accordingly. Yorkshire bank have to change their strategies according to the rules set by the
government so that their productivity wont get affected (Spinler,2013). The firm can get
opportunities from the new laws of UK government through which they can easily attract new
customers towards offering of the bank. Whereas, the firm has less skilled and knowledgeable
staff which can impact on the decision-making.
Technological environment:
It refers to latest and advanced technology used by bank to improve their quality and
quantity of services provided to them. For instance, after recent development in banking industry
,government has given orders to all the banks for using of application programming
interfaces(APIs). It states that customers can easily share their financial information with
different service providers and can make transfers to any banks and non banks and at last they
can change their service provider in one click. It would reduce the transaction cost of bank which
is positive sign for their balance sheet (Childe,2011). The company will easily gets competitive
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advantage by using APIs whereas, the firm has to make more investment for adopting this kind
of services which will harmful for the profitability.
Legal environment:
Yorkshire bank have to follow all the rules and regulations made by their government to
avoid legal issues. UK government is strict in following rules like financial services and market
act 2000 states that engage in regulated activities unless authorised is a criminal offences. Apart
from that, company have to considered employment law, wages law, etc while hiring employees
for jobs which will incur cost to company (Chavis, 2011). The company have to follow the rules
which are formulated by the UK government because it helps them in decision making for
maintaining growth and sustainability in the market whereas, the employment and wages law can
increase the employee turnover of the firm
Environmental environment:
Nowadays, people living in UK are serious and concern about the environment problems
their country is facing due to global warming and various other issues. To cope up with that, UK
government has made strict rules like climate change act 2008 or energy act 2011 which states
that companies will be penalised for polluting the environment if found guilt. Yorkshire bank has
started there own Yorkshire bank and Clydesdale bank foundation in July 2008 which helps need
people, communities with a main aim of betterment of society. This indirectly helps company to
increase their goodwill in the mind of customers. The firm has to pay attention on the acts which
are created by the government for protecting the environment with the help of it, firm can create
a good brand image in the mind of customers. Whereas, if the company will not pay attention on
the environment act it will negatively affects on the profitability of firm. Therefore, the
management of firm have to consider such kind of factors which can harmful for their brand
image (Laudon,2016).
TASK 4
P5: Internal analysis of organisation for identification of strength and weaknesses
Swot analysis is done to asses strengths and weakness within the organisation and
different types of opportunities which company can attain to gain competitive advantage and
threats so that company would be ready to tackle it with full potential (Wassenhove, 2016).
SWOT analysis for Yorkshire bank is elaborated below,
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