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Business Environment and Types of Business Organisations. Study on Aston martin

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  • Level: High school
  • Pages: 20 / Words 4984
  • Paper Type: Business Plan
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Organization Selected : Aston martin
Question :

This assessment will cover:

  • Elaborate types of business organisation.
  • Provide scope and size in Aston Martin.
  • Critically analyse the macro-environmental in Aston Martin.
  • Provide interrelation in macro-environmental in Aston Martin. 
Answer :
  • INTRODUCTION

    A business organisation is an individual or association of people that are working together with a common interest. It has been seen that every business is having their own motive and plans. The aims can be either short or long term which is valuable for profitability analysis during the period of time. The future aim is to maximize organisational profitability by improving the internal system or minimising the operational cost. Short term objectives are basically related to increases in overall sales of the company (Shigang, 2010).

This project aimed at providing specific information about three business organisations such as Aston Martin, Oxfam and NGO and their purpose. Apart from this, analysis of the various areas that consist of legal structure, size and scope are also covered in this report. Along with that, the interrelation between various organisation functions is mentioned effectively. Understanding all the external as well as internal factors in relation to the business is discussed in this report.

TASK 1

P1: Types of business organisations and their purpose

Introduction

It is necessary for any profitable business earning firm to make a plan as per the objective of becoming a valuable organisation in the world. A business would be evaluated over the motive of building its reputation and attainment of its all set goals which further support in developing the competitive advantage over other companies. There are various types of business organisations that are working in their respective areas. These are divided into private, public and voluntary sectors. Each of them are having different aims and legal structures. It refers to the legal rights, associated with the administration of a company to follow this structure and work in an effective manner to attain its organisational objectives. There are vital purposes and legal aspects are mentioned below:

Private company: It refers to a company that has been owned and operated by either a sole trader or in partnership. Private companies are not liable to offer their share to the public as it is regulated under strict legal norms. The organization that lies under this category can get their stock issues and have shareholders but is not permitted to trade it on the public exchange. Such as, Aston Martin is one of the leading luxury car manufacturing company which is well known for its branded cars. This company is established in the year 1913 in London by a person named Robert Bamford. The overall net earning of this company during the year 2017 was about £ 876 million. The total labour working within this organisation is around 1890.

Purpose:

The basic motive behind these types of business organisations is to earn maximum profit and make effective plans to stay longer in market competition. It has been found that business can earn only by attaining maximum market shares for their products as compared to other companies.

Legal Structure:

Partnership: This refers as the formal business organisation which is operated by two or more parties. The partnership is generally formed with an legal agreement which depict about the share and liability of party in respect of company and on the bases of this agreement profit and loss being shared among partners.

Sole proprietorship: This seems to be more effective business in which company is managed by only one person. The owner of business is personally being liable for all the profit and losses gained by an organisation. The debts of the company are managed by only one person and have entire management is also handle by them.

Limited companies: It will specifically relate with type of company in which liabilities of partners are limited either by their number of share & investments or guaranteed by company. However, the total liabilities of parties are limited to the list of unpaid amount of shares that are kept by the company’s shareholders.

Advantage of private organisation:

The shares of Aston martin can be sold not advertised. More capital is available for the expansion of the business. Limited liability for shareholder as they are not liable for business failure.

Disadvantage:

There are certain legal requirements such as too costly and time consuming. Shareholders to approve if a shareholder sells out shares.

Public sector organisation: It refers to a company that can easily exchange and trade their overall securities on the stock value and that will be bought and sold by anyone. These are basically managed and regulated by legal authorities such as government. All the activity are related with the transport, healthcare and other learning aspects those are related with the company. NHS is one of the primary examples of these types of business is provide all specific medical services to the needy persons. They can have used to deliver all vital services all over that world.

Purpose:

The basic motive of this organisation is to deliver public services instead of incurring sufficient amount of profit. It will be created with proper employment opportunity for the innovative skills people.

Legal Structure:

  • Central government: It will make sure that entire management and operation must be followed in respect to determine or control the mistakes early.
  • State government: It is operating with the motive of increasing the local job those are supplied and it is basically related with public sectors people that includes with local bodies and other medical sectors (Pikka, Iskanius and Page, 2011).
  • Local government: It would make ensure that every legal rules and regulation those are made through state as well as central has been followed effectively by the government.
  • Advantage: The public used to control the services and henceforth profit margin are kept minimum. The cost of using services are covered from the taxpayers thus cannot go too much into debt.
  • Disadvantage: Risk of uncontrolled growth as well as management issues. It is also too expensive in case of listing into the stock exchange.

Voluntary organisation: It is said to be an organisation those are made with the motive of delivering services for the welfare of the society. These types of organisation work toward the overall growth and development of people. It is simply associated with increasing overall satisfaction level of client. Example, Oxfam is one of the crucial sectors that have been used to deliver medical facilities for overcoming the poverty from the community.

Purpose: This is simply related with the motive of attaining all the advantage and growth to the society without any kind of aim the entire motive is to serve the society. One of the positive thinking of these particular sectors is to evaluate the crucial growth instead of material wealth for the company.

  • Advantage: The are working with wide range of activities. Because of which chances of additional cost can be reduce up to an extent.
  • Disadvantage: Unplanned and relatively uncontrolled factors are relying on the goodwill of an organisation. No guarantee of financial support in near future time.

For profit

Not-for profit

Non-government organisation

The main motive of this types of organisation is to earn sufficient amount of profit for their stakeholders.

They are working for providing better services that are required by the society.

Such types of organisation are working independently from any form of government.

It has been seen that corporation and their owners are subject to income taxes.

Exempts from the income taxes it is approved by IRS under section 501(c) (3).

The majorly aimed on human right, environmental or development work.

Conclusion

From the above report, it has been articulated that all the different organisation are equally related with each other. Its objectives are analysed with the motive of examine the profitability and efficiency of these companies.

P2: Size and scope of various organisation

Introduction

In business organisation there are different type of organisations which work independently according to its size and scope. This consists of specific detail description of various size of an organisation that consists of Micro, small, Medium and large. Every four types of business organisation are having various essential aspects those are affecting the goal that are set by the companies. This particular aspect consists of overall interrelation those are arising among with the relation of supply and demand of the company (Avramenko, 2012).

Different types of organisation: It is having been found that there are various types of organisation those are working for the motive of earning profit. Such kind of organisation is having their own size and scope. As per the size of organisation, it can be divided into its large, medium and small level. It has been seen that as per the size of business its objectives changes. Some of them are mentioned below:

Micro: It refers as the small business organisation that is having less than nine employee operating together to accomplish their aims. Such types of organisation are having overall turnover of less than 2 million. In accordance with the establishment of specific kind of business there is requirement of less funds. It is majorly consisting of family business that is formed with by one of more than one person.

Purpose of this types of organisation is different as compare to other operations. There is primary motive to survive in the market for receiving effective quality in their products and services.

Small and medium: Such types of business are privately owned bodies, partnerships and sole trader under which minimum number of staffs are operating with an aim to earn maximum profits. These organisations are able to ascertain proper support of legal bodies in their business activities and tried to targets for preferential policies. In order to operate the business, they need to have a more than 50 but less 250 employees. The objective of this company is to draw the attention of wide number of client for the improvement of their sales and profitability.

Large: This consists of all types of organisation those are having large number of employees that are more than 250. For this purpose, they have to fulfil all the standards that are fixed by government. Wide number of capital are needed to operate the business operations of large organisation as they need its products and services in plenty of nations. The primary objective of such kind of business is to expand their business in respect to attain wide number of market share. Example, Aston martin which is operating their business operation in so many nations (Bovee, Thill and Raina, 2016).

Industry: It is said to be those sectors which are related with the production process of products and services in relation to managing economies of scale of the company. The essential sources of earning are the primary indictors that assist in examine of their relevant industries. In case the organisation used to increase the profits from the wide number of sources then it is related with working in various nations.

Supply: This consists of that particular amount of products and services which is presented in the market with the consumption made by the buyer at the particular price.

Demand: This seems to be examine from the concepts that how much a customer is willing to pay for the products and in what prices. It can be affected because of the changes in buying behaviour of the customers.

It has been found that in case of manufacturing sectors, there is huge relations among the concept of supply as well as demand. In case the demand in the market for the luxury cars is high then Aston Martin need to make maximum supply of products.

Transnational corporation: It is said to be multinational corporation that is working with the corporation as home base, but is registered, operates and has assets or other facilities in at least one nation at that particular point of time. It used to take foreign direct investment, owns or control income collected assets in more than one countries. Example, Aston martin is the company that can operate their business as transnational corporation.

Conclusion

This particular part explains specific information about the size and scope of organisation that can lead to effective utilisation of resources in small, medium and large organisation.

TASK 2

P3: Interrelation among different organisational department and their link

Introduction:

It has been found that there are various types of business organisation which are working with the motive of becoming one of the leading companies in comparison to other. In this part, various department those are associated with the Aston Martin has been discussed effectively (Cavalcante, Kesting and Ulhøi, 2011). It consists of marketing, finance, HR and operation department. With the collective efforts of all the departments that can assist in attaining overall aims and objectives of the company. Here, definition of organisation structure and five common business motive are covered properly.

Different types of department and their interrelation

Aston Martin is one of the known car brands that tend to provide their luxury cars and superior quality of services to their customers at the international level. Behind the success of the Aston Martin, there is an essential role that has been played by their departments such as marketing, finance, HR and operations. Role of these particular departments and its connection is examining from the below mentioned points:

Finance: It is one of the crucial departments without which no one can be able to manage and regulate their business operations more effectively. The primary motive of this company is to finance the capital by various department for the overall performance of their business functions. They would have certain responsibility that is related with the raise of funds through the use of other sources. Appraisal of actual analysis of the employee’s performance with the development plan that contribute to the fulfil their basic standards.

Marketing: This particular department is working with the motive of providing all the basic function in relation to promote and advertise their products which are produce by the company. They would have overall responsibility that to make market analysis and help the company to provide information about demand of customer from the company. The functions of this particular department is to assist other departments such as operations to attain their objective in more crucial manner. Basically, it has been directly related with the finance department also. With the proper allocation of sufficient amount of capital, it can help them in using modern tools of promotion techniques which would be spread awareness between the individual society (Hair, 2015).

Operation department: This primary motive of this particular department is to utilise all the valuable resources that can give providence of quality items to their close customers. They would have basic duty that can evaluate the information which will be provided by the marketing departments in order to assess the demand of various products in the other market. It can assist the manager to control their operations as per the demand as well as preferences for their optimisation fulfilment of the customer satisfaction. It can bring maximum efficiency in their overall operations that relies on the HR department that is appointed skilful for an employee.

Human resources: This particular department is having primary role within the organisation which assist in regards to make plan about the workforce and administration of entire employees in proper manner. The different functions which are provided by this department that consist of recruitment and selection of staffs, appraisal of performance and training and development. In the interrelation to other departments that can assist in appointment of skilful employees which can have knowledge in regards to their respective fields.

Five common business objectives:

According to the above role of various departments in Aston Martin which can assist in attainment of all their specific business objectives. Five most common business objective of Aston Martin provide for their diversified business operations are mentioned below:

  • Survival: One of the basic aim of Aston Martinis to achieve sustainability in their operations that can help the company in long term growth. In relation to, operational departments of Aston Martinplenty of strategies and plans as per the need of their department (Hamilton and Webster, 2015).
  • Increase in total sales: This particular purpose of Aston Martinis to make modification in their sales value that can assist them to grab wide market share. In relation to this, the main role is to perform the marketing department more effectively by the help of using reliable promotional tools that can assist in drawing the attention of client of their competitors.
  • Profit maximisation: In case of Aston Martinwhich is a private organisation that is working with the motive of earning huge amount of gains. To reach their set objectives, it is needed to ascertain all the collective efforts of all departments effectively.

Organisational structure:

Function- based: It divide the overall organisational hierarchy on the basis of various department such as marketing, HR etc.

  • Geography based: According to the types of market the structure is been decided with segmentation of the market.
  • Product based:It has been decided with the diversified offering structure within Aston Martin. Such as Luxury car.
  • Customer based: This particular structure of Austin is segmented on the basis of client demand and behaviour.

Conclusion

This has been seen that different functions which are interrelated to one another that contributed in the attainment of organisational common aims and objectives as mentioned in the above.

TASK 3

P4: Positive and negative impacts of macro-environmental factors

Introduction:

In order to analyse the external factors that are associated with business operation of the company. It trends to provide reliable opportunity to the management of Aston Martin to ascertain the positive as well as negative implication of various factors that are discussed below:

PESTLE analysis

Political factor: It has been seen that government implication is making huge impact on overall growth of the company. Minimum wages have increase the labour cost as well as EU regulation as also increase the exports prices of the car prices.

  • Positive: It is having major business operations in UK where the government remain stable because of which chances of earning can get increased.
  • Negative: There are certain restriction that are imposed on import and export after separation of EU has create negative impacts on the company (Karagiorgos, Drogalas and Giovanis, 2011).

Economic: There are various other economical factors those related with the business. It is basically includes inflation rate as well as exchange rate policies that are planned by the nation.

  • Positive: In case of economic situation the country is positive helpful in the expansion of their business operations.
  • Negative: In accordance to the low level of income of an individual that can decreased with the overall demand of item that can has minimum impacts.

Social: These types of external factors which are directly or indirectly related with the ethical aspects of the company such as culture, norms, tradition of the society in which business operates. There are certain other factors such as demographic are related with Aston Martin.

  • Positive: This company used to deliver effective quality of car that can fulfil the demand of the rich class people. Because of the trust factors society tends to use the branded cars.
  • Negative: With the continuous changes in the present trend, it has been creating negative implication of the Austin company growth level.

Technological factor: This seems to be vital market in terms of car manufacturing sectors where they want to provide fast, luxury and more comfortable facilities in their branded cars. It would assist the Aston Martin to provide more security, risk and compliance associated with the company (Kolk, 2016).

  • Positive: The use of latest technology to assist them to make modification in the current technical system that are used within the car.
  • Negative: It will provide reliable outcome that can increase the overall cost of production as well as prices of high speed cars because of which negative impacts get arises.

Legal factors: This consists of various legal norms and rights that are associated with the intellectual property rights those are followed by Aston Martin in their business.

  • Positive: It can assist in increment of overall share and profitability at the same point of the company.
  • Negative: The employees would need to be pay as per the consumer legislation norms in case they are not able to get those, it will create negative impacts on the business.

Environmental factor: It consists of those factors which influence the operations of Aston Martin such as environmental law, carbon discharge from factories, pollutions etc.

  • Positive: The company is using all the ISO standards that are associated with the manufacturing of the automobile sectors. It will help them to fulfil the basic requirements of the Aston Martin
  • Negative: The government has already set the standard towards the carbon emission in case it is up to the maximum quality then the changes of negative impacts can affect the profitability of the company.

Conclusion

It has been determining that from the above external analysis the favourable condition assist with adequate information which help Aston Martin to attain their aims and objectives to get maximum profitability.

TASK 4

P5: SWOT analysis of organisation

Introduction

Under this, management of Aston Martin is using SWOT analysis as internal tools for the purpose of examine the crucial aspects of the company.

Internal environment: An organisation internal environment is categories as the valuable aspects with the company that consists of current employees, management and basically related with the corporate culture that are defines employee behaviour.

External environment: It is one of the crucial factors that can affect the business from the external level. The business must act or react to keep up their flow of operations. Various external factors that can impact the overall ability of a business or any kind of investment to attain their strategic objectives.

  • Strength: Aston Martinis one of the valuable automobile company that is associated with the production of branded cars. It would provide contribute 90% of total earning in the UK market. They are planning to introduced latest edition cars as per the demand of the upper class people.
  • Weakness: The overall structure is not so flexible that can adopt specific changes as per the domestic market. As a big brand in automobile sectors it would need to protect products from getting copied from the external parties (Nishitani and et. al., 2012). There is certain limitation that are associated with the company while planning the products as per the customer sometimes cannot fulfil the demand of the customers.
  • Opportunity: Because of the current technology, Aston Martinhas plenty of opportunity to design their own internet website that will be assist in overall promotion as well as high number of sales of their cars collections. In the present time there are various latest opportunity to expand their business for longer period of time.
  • Threat: There are various showrooms which are having cars as per the demand of the customer. Some of the current government policies in relation to automobile sector is primary threat for the company. The competition in the market with the fast racing car like Buggati and Bentley are the biggest threat for the company.

Conclusion

In accordance with the internal analysis, it has been ascertained that Aston Martin is having wide range of market operation. It would help them to grab all the crucial opportunity by proper utilisation of resources.

TASK 5

P6: Interrelation of Strength and weakness with macro-environmental factor

Introduction

There is huge relation between the strength and weakness of Aston Martin with the external environmental factors. All of them are effectively discussed under this part of the project.

Interrelation of strength and weakness with external factor

Strength-opportunity plan: It is one of the internal aspects which is examine from the SWOT evaluation of Aston Martin. The large number of funds are presented with the organisation that can assist in expanding the business operations into the new nations (Osterwalder and Pigneur, 2010). It is essential for the Aston martin company to make analysis of the market before introducing new brand cars into the market.

Strength-Threats strategy: The primary strength of Aston Martin is that it is well known automobile company which provides quality of products in removing threat of plenty of other car manufacturing dealers. Keeping in mind about the use of techniques the company must be aware about the threats that are associated with the marketing strategy for Aston martin.

Weakness-opportunity plan: The basic opportunity that is present with Aston Martin is by using the latest method of production they can expand their business operation as well as improve the sales figures. During the production process use of maximum labour, forces can affect the overall profitability of the company in the coming period of time.

Weakness-threats plan: It has been seen that threat which is been examined by the Aston Martin as per the planning made by the legal bodies. The adoption of the reliable method they can have the opportunity to reduce the weakness in relation to securing their invention with proper protection from the other outside companies. It is essential for Aston martin to make sure that overall planning must be made prior so that the chances of errors can be reduced.

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Conclusion

This part has been analysed effectively by taking information from the strength and weaknesses of Aston Martin with that the external factors. It can assist in analysing the overall opportunity they are having in attaining their set objectives.

CONCLUSION

From the above project report, it has been concluded that the business environment is one of the crucial factors that are associated with the internal as well as external forces or changes that are associated with the company. Analysis of various types of business organisations with the overall function, size, and scope is discussed accordingly. To perform operations effectively a company can use PESTLE and SWOT analysis which supports adequate information that depicts the up[coming challenges as well as opportunities in front of the company.

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