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United Kingdom's business environment of John Lewis

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INTRODUCTION

Business environment of modern world is filled with many internal and external factors which can put both positive and negative impact on organisational functions (Business Environment, 2018). Some of elements that can be mostly get affected are: employees, customers, management, supply, demand and various business modulates. If company do not takes care of these functions of firm then it is may be possible that business enterprise may not hit their targets. Under this report, organisation that has been taken in order to understand the business environment is John Lewis. It was found in 1864 and from then have introduced ample number of products in all over world and carrying highest chain of departmental stores. This assignment will show types, size, scope and purposes of different organisation in UK. Also, strengths and weaknesses of macro elements which contains many pros and cons that can affect operations of business.

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TASK 1

P1. Different types and purposes of organisations

United Kingdom's business environment is carrying various sort of opportunities for entrepreneurs and for business people who are already doing business. It has been analysed that, after when Brexit took place where UK got evicted from European Union, government of this nation has created various policies and these rules were carrying liberality (Bovee, 2010). This actions influenced people to become entrepreneurs and business people so that economical conditions can get influenced in an effective manner. On the other hand, it is being found that there are various sort of scopes and size there organisations are carrying and some of these are given below:

Basis of Comparison

For Profit

NPO

NGO

Meaning

Firms that delivers different sort of services to customers with the aim of earning profit comes under this section.

These firms deals in different sections and majorly delivers products and services to customers without keeping aim to make profit or to earn money.

Organisations that comes under this section mostly works as charity and provide different things like services and items without keeping aim to earn money.

Area of Operations

These firms can do business at both large and small area.

These companies mostly deals in different sections and does business in a larger area.

Firms under these does business at both domestic and international level.

Objectives

Aim of these companies stays is to make high profit through delivering products to consumers according to their requirements.

Promoting the art, knowledge base disciplines, mercantilism stays main aim of these firms.

Improve standards of people of United Kingdom.

Three major sections in which organisations have been distributed:

Public Sector- Different business bodies that are being run by government of UK comes under this sector. British Broadcasting Corporation (BBC) is a good example of a governmental body that deals in telecommunication section.

Purpose– There are many purpose these governmental bodies are carrying like economical conditions, transportation system, building infrastructures, telecom in order to improvise conditions of nation (Bryman and Bell, 2015).

Private Sector– Mostly, these firms are limited in nature and can be owned by common people. John Lewis, which carrying good name in all over United Kingdom and have largest chain of departmental stories can come under this section.

Purpose– Earning profit is being considered as the main aim of firms that comes under this phase.

Voluntary Sector– Firms in this mostly deals in different sections and tries to develop living standards of citizens of United Kingdom. Oxfam which is charitable trust which is working in almost every city of UK. Government has also helped this firm in initial years of it.

Purpose– Improvise life of people, delivering appropriate services like health care, food and employment to citizens of United Kingdom who are in need.

Legitimate Structure of the Sectors:

Private Sector: Firm's owner can be anyone who is willing to open up his/her own business. There are two type of firms that comes under this section.

Sole Proprietorship

Single person who have owned a business firm can be known as sole proprietors. Loss and profits are being faced and bear by this single member only.

Partnership

Business under this is being run by two or may be more partners where ratio of profit and losses can get set through making a partnership deed.

Public Sector:Firms that are being run by governmental bodies comes in this section.

State Government

Governmental body that develops policies and other rules which is for improvising whole state of a country (Buckley and Casson, 2010). Like developing a policy in order to deliver benefits to students of a particular state. Health insurance policy for people of a singular state.

Neighbourhood (local)government

Bodies of government takes orders from state government where they does activities in order to improvise day to day life of citizens of United Kingdom.

P2. Size and Scope of various types of organisations

After when Brexit took place it has been analysed that United Kingdom's government have taken full of responsibility for business organisation who were carrying different size, scopes and other things. A fresh business environment, every firm looks forward to have because that area stays liberal for a longer period of time where any firm can earn profit as much as they want. United Kingdom in some recent years carried the same sort of environment that influenced many entrepreneurs and business man to do business in UK. This action developed the economical conditions of United Kingdom in a short period of time and also it is continuously putting positive impact as well on the same. UK's government have made a deed which clearly showed that companies that are carrying different sizes along with scopes, mostly comes under three major sections (Kang, Lee and Kim, 2010). These are given beneath:

Private Sector organisations– Companies in this sector can be owned by any person (Common people). Therefore, it has been analysed that most of employment in United Kingdom is raised by firms that are coming in this sub section. John Lewis which is a multinational departmental brand comes under this sector which carries an aim of developing economical conditions along with making high range of profit as well. Government have set requirements of this sector which a company should have in order to comes under this section and these are:

  • Around two employees company should have in order to come in this section.
  • A company can carry may employees as much as they want according to the operations which has been done by them.

The size of John Lewis:

  • More than 50 shops in all over United Kingdom and they are big in nature.
  • Around 39,000 staff members are being recruited John Lewis in order to better serve to consumers.

Public Sector companies– Under this section, both the things like scope along with size can be stated as properties and this depends on purpose of business which is being done by government (Kian Chong, Shafaghi and Leing Tan, 2011). Along with this, organisations that are coming under this section carries various joint ventures as well. Under this size and scope is given beneath:

  • Company should have have at-least 7 employees.
  • According to the operations governmental bodies decides about employees that these companies should have.

The size of BBC:

  • This firm is having around 30,000 employees.
  • It is parental company of different firms and have generated £-129.1 million as net income in the year of 2017.

Voluntary Sector– Companies who delivers products and services and other facilities like health care, finance to needy people and other responsibilities comes under Voluntary sub section. It has been examined that these firms mostly have support from government of United Kingdom. Oxfam which is one of big charitable firm that delivers its services to people and organises events in order to bring awareness among citizens of UK comes under this sub sections (Klapper, Lewin and Delgado, 2011).

Objectives differentiation:

Micro

Small

Medium

Large

Firms that for the most part creates income keeping in mind the end goal to survive goes under this segment like: little outlets, shops etcetera.

Associations under this segment bargains in various zones and endeavours to convey items and administrations to clients so that to gain cash. Like: consultancy firm which is having almost 10 to 50 representatives.

Organizations which is working together at residential level and putting endeavours so that to extension should be possible and business can get prompt worldwide market.

John Lewis expressed as firms that are working together at worldwide level. These organizations under this sub segment conveys fundamental point and single rationale is to win benefit.

TASK 2

P3. Relationship between different organisational functions

In modern world, effective interrelation among different departments and functions of business organisation plays vital role. This may lead business firms in attaining specific short and long term goals and objectives of companies right on time. On the other hand, it has been located that, John lewis is carrying a good name in all over world but when it comes to run business in a successful manner it becomes vital for companies to have good relations among managers and leaders of sub sections like financial, research and development, marketing and production and many more (Klapper and Love, 2010). These are organisational functions and are given beneath:

Marketing: This can be considered as one of main organisational functions that can take company to hit their targets. On the other hand, it has also been analysed that objectives of business firms can only be accomplished if they will take this element as major one. Because marketing section of organisation stays connected to the ground floor and carries all the information which is related to customers needs and trends. John Lewis is looking forward to enhance their sales. Therefore, marketing section will give information to operational department which will then modify products according to their requirements.

Human resources: If this department which is a function of organisation will not stay effective then it is may be possible that firm may not attain their goals and objectives. Apart from this, if it will be effective in nature then sales of John Lewis can be increased. Human resource mostly delivers training and fills vacant seats with talented candidates. This action can help in enhancing sales of John Lewis.

Finance: John Lewis which is a multinational brand and doing in business in almost every state of United Kingdom. It has been located that, this organisational function plays an important role when it comes to meet desired goals and objectives. If funds will not stay appropriate like liquidity then it is may be possible that firm may not execute plans right on time.

Operation: Another major organisational function in whichmodifications are being made in products and services as per necessity in order to enhance sales. John Lewis if wants to attain desired goals then it is required for firm to keep on looking into different aspects that can put this function in risk. All the market trends can get affect profit margins and sales of a company (Machuki and Aosa, 2011).

Therefore, it is much required for John Lewis to keep an appropriate interconnection among different functions of organisation. Through this, goals and objectives of company can easily be met in specific time of period.

P4. Positive and negative impacts of macro environment has upon business operations

Macro environment is filled with various factors that can put positive and negative impact on business firms. In order to understand the macro environment, PESTLE analysis is being done of John Lewis and these are given beneath:

Political factors:Policies which is being formulated by government of United Kingdom influenced working of business firms that are coming in this nation.

  • Positive impact:Pricing of goods and items can be done with the help of policies that has been developed by governmental bodies of United Kingdom.
  • Negative impact:Change in policies at every single month can be termed as major issues which can be faced by business firms.

Economic factor: Consumers pocket,economical conditions of nation, GDP and foreign exchange rates are being considered as some major materials that are coming in this factor which mostly affects business of different firms (Mahmood and Hanafi, 2013).

  • Positive impact:Economical conditions of a country will stay strong then high number of customers will purchase good and services.
  • Negative impact: Recession can be termed as major issue that can mostly affect sales of John Lewis.

Social factors:Corporate social responsibilities is anactivity that can be taken under in use by organisations in order to develop good perception of customers.

  • Positive impact:Long term relation can be made by John Lewis through developing a proper plan where CSR activities took place.
  • Negative impact:Reputation of company is highly depends upon the products that are manufactured by them them. Therefore, if commodities are not produced according to the choices and preferences of customers that it can have a negative impact on company.

Technological factors:With the change in course of time, many new technologies have evolved which are helping company and humans in performing their task in a better manner. In context with John Lewis, they are using these new technologies for manufacturing goods in an effective manner. Its positive and negative impact are explained below:

  • Positive impact:In this category, it helps firm in making changes and alteration in their existing products so that it can add value to its products (Ullah and Lai, 2011).
  • Negative impact:Implementing new technology, can be quite expensive therefore, it is required for John Lewis to look into different aspects in a proper way in order to reduce unnecessary expenses.

Legal factor:Laws which has been built by Government needs to be properly understood and applied at workplace. These can put both negative and positive impact on business of John Lewis.

  • Positive impact: Working with considering all laws as major ones that may help John Lewis in hitting their targets.
  • Negative impact:Company's reputation can be reduced, if they are not following laws.

Environmental effect:Global Warming comes under atmosphere of United Kingdom, this element can affect profit and sales of companies (Welford, 2013).

  • Positive impact:Eco-friendly goods and services can help John Lewis in enhancing sales of products and services.
  • Negative impact:Cutting of trees in order to build up a structure is being considered as major negative effect.

TASK 4

P5. Internal and external analysis of company to identify strengths and weaknesses

It has been analysed that, both external and internal factors are present in business world which can put impact on business of John Lewis. This includes various things like marketing schemes, market places, sales, brand image are some major elements of John Lewis which can put both positive and negative impact on business organisations. SWOT analysis of John Lewis is done below:

STRENGTHS

WEAKNESS

  • High brand image along with online presences.
  • Employment relations at workstation of John Lewis is high in nature (Werther and Chandler, 2010).
  • 39,000 staff members who are delivering services 24*7 to consumers.
  • Zero market presence at international level.
  • Less effective marketing policies that has been developed by leaders of it.
  • Less competitive advantages.

OPPORTUNITIES

THREAT

  • Expansion of business at international market with considering globalisation process as major part.
  • Innovation of various unique selling products and services according to needs of customers.
  • Failure in new markets because of cultural variations.
  • Cash flow issues.
  • Rise in competition.

P6. Strengths and weaknesses interrelate with external macro factors for the chosen organisation

Smaller scale and large scale condition factors are broke down by administration of John Lewis to break down relationship of segments with each other (Wild, Wild and Han, 2014). PESTEL investigation is fitting system utilized by better than have finish data about market circumstances. This assistance organization to recognize qualities and shortcomings for influencing framework to work viably.

Political:This is basic factor which effect on development of business tasks. Government outline guidelines and directions which require to be taken after and overseen by organization of John Lewis to set up great position and picture in UK.

Strengths: Every country have diverse lawful groups, John Lewis pays tax collection and administration have planned arrangements to influence framework to work legitimately.

Weaknesses: John Lewis has branches in various countries which impacts on business which require to work in regard to government. This makes administration undertakings mind boggling and troublesome (Bovee, 2010).

Economical: Interest rate, conversion scale and expansion are different segments which are controlled by government on premise of conditions and condition of economy. This effects on import and fare of John Lewis, which rely upon advertise circumstance of UK with other country.

Strengths: John Lewis has solid market reach and client base, as there is swelling in UK which assist individuals with having satisfactory salary to buy things in regard to their taste and inclinations.

Weaknesses: Interest rate in high in UK which decide on measure of assets accessible with John Lewis.

Social: Demographics, hard working attitude, way of life patterns etcetera are parts which rely on deals and benefit of John Lewis.

Strengths: Research and improvement causes John Lewis to have finish data about market slants and give things as needs be.

Weaknesses: Customer's taste and inclinations continues changing with time, this effects on deals and productivity of John Lewis.

Technological: John Lewis utilizes most recent apparatuses and strategies which enable firm to convey most recent items and use assets effectively.

Strengths: John Lewis has solid market picture and altruism which is because of popular things gave to clients.

Weaknesses: John Lewis require to roll out improvements in apparatuses and advancements which impacts on business and assets (Bryman and Bell, 2015).

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CONCLUSION

From above mentioned report, it is being concluded that business environment contains both internal and external elements which carries a rapid changing nature. The alterations can put both negative and positive impact on running business in successful manner. Away from this, it has been located that, both of these elements needs to be looked upon in a proper way. Through this only benefits can be raised right on time. With the help of this, firms can hit their targets in much effective and in proper way as well.

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REFERENCES

  • Bovee, C. L., 2010. Business Communication Today, 10/e. Pearson Education India.
  • Bryman, A. and Bell, E., 2015.Business research methods. Oxford University Press, USA.
  • Buckley, P. J. and Casson, M., 2010. Models of the multinational enterprise. InThe Multinational Enterprise Revisited (pp. 147-176).
  • Kang, D., Lee, J. and Kim, K., 2010. Alignment of Business Enterprise Architectures using fact-based ontologies.Expert Systems with Applications. 37(4). pp.3274-3283.
  • Kian Chong, W., Shafaghi, M. and Leing Tan, B., 2011. Development of a business-to-business critical success factors (B2B CSFs) framework for Chinese SMEs.Marketing Intelligence & Planning.29(5). pp.517-533.
  • Klapper, L., Lewin, A. and Delgado, J. M. Q., 2011. The impact of the business environment on the business creation process. In entrepreneurship and Economic Development(pp. 108-123). Palgrave Macmillan UK.

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