The assessment covers following questions:
- Evaluate the Tesco structure on the basis of type,size and its scope.
- Examine the relationship of functions of Tesco with its structure.
- Use appropriate examples to show the negative and positive influence of macro environment on the business operations.
- Describe the internal strength and weaknesses of business and their relation with external factors.
Business organisation have to transact as well as interact with their surroundings. So, both business and environment are wholly interrelated and mutually interdependent. Business environment is regarded as that aspects of the atmosphere entities that influence their operations as well as ascertain its efficaciousness. This assists entities to ascertain opportunities and threats, provide guidance for growth, meeting competition and others in effective and efficacious way (Trisakhon, Onputtha and Peamchai, 2018). As per the scenario the undertaken company is TESCO which is a renowned general mechanised as well as grocery retailer and is established in year 1914. It have various subsidiaries such as Tesco bank. Mobile and others as well as having headquarters is in Welwyn Garden City, Hertfordshire, England, United Kingdom. This reports covers several kinds and purpose of organisation, its size, structure, objectives and many more. Moreover, several types of organisational structure, analysis of how PESTLE factors affects UK retail sector, SWOT analysis and five forces analysis are explained. Apart from this, how strengths and weaknesses which interrelate with external macro factors are also discussed in this report.
P1 Explain different types and purposes of organisations; public, private and voluntary sectors and legal structures
There are some kinds of organisation that are profit, non profit and public.
Profit organisation, this mainly exits for generating profitability which is to take more money than their expenditures (Linder and Williander, 2017). It is regulated through the sole proprietors or owners. For example: TESCO, this is the private firm that deals in private sector. They have more than 6569 stores that is situated in global marketplace. It operates into UK in successful way. Product and services, it facilitates products such as groceries, clothes, foods and many more. In respect of services, they render banking, mobile and others. Moreover, it also facilitates home delivery services for audiences for providing them comfortability. The objectives of TESCO is to facilitates standard quality electronics goods, clothing, groceries and online. In addition to this, the purpose of TESCO is offerings clients and or shopper each day in appropriate manner. Along with becoming leaders for targeted audiences and aids them to facilitate effective quality of products or services. Legal structure, It is following the public limited legal structure that consists vast number of person who are performing or working for their beneficiary. Size, in respective private organisation there are more than 460, 000 employees who works and it has many subsidiaries like banks, Stores and many more. In order to enhance profit and market, it has to spread their entities internationally at market area. Scope, the practices of TESCO is considered as fundamental elements of strategies. So, their main scope is to enter within market where it can sell their products or services in successful manner. Being a large market retailer at UK, It plan to expand into U.S. which aids them obtain higher profit.
Not for profit organisation, this is regarded as the kinds of organisation which do not gain profitability for their owners. The firms into this sector are tax exempt charities or another kinds of public service entities (Dyllick and Muff, 2016). For example: OXFAM, it is a charitable company that is founded in year 1942 and are focused on removing poverty, disaster relief and so on. It concentrates on resources like gender justice and many more. Products or service, they serve service such as provide shelter to disaster people and de create as well as protect lives in case of crisis. Also, the essential objective is to render aids to person, safeguard its lives as well as increase finance for fundamental services. The main purpose of respective non profit organisation is to assists and create longer solution to poverty injustice people. Legal Structure, the OXFAM legal structure is unincorporated association where they formed the agreement among its workers. It concern on person rather than getting profit. Size, OXFAM is the small firm that assists the residents of UK by reducing poverty, relief from disaster and so on. It has approx 20 independent charitable entities which works to develop a poverty free country. Scope, It is exploring their services into other part of world. They performs with partners company and try male and female vulnerable to end misconduct or injustice which cause poverty. Moreover, they also works for increasing voice of poor people that influence local and internal decision which affect them a lot.
Public sector organisation, it is regarded as an entities which are developed because of an regulation which is governed with the intent to enhance public welfare (Vij and Bedi, 2016). For example: NHS is a public organisation into United Kingdom which is regulated and funded through government. Products or service, this facilitates the health care as well as medical services to people and also there is not nay restriction to pay total amount. Moreover, the main objectives of this is to render the most raised standards care which are not only safe but also very much efficacious. Purpose, it is concentrated upon rendering effective health care services to audiences by using limited resources which are available. The funds which firm receive from individuals are totally utilised for public care only. Legal Structure, the public organisation like NHS comply public corporation as legal structure as this is developed by parliament act. It is funded by government for rendering service in respect of medical treatments and others. Size, The national health services concern about facilitating medical as well as health care services to public. Also, it is large in size that provide free services to the residential of UK. Scope, As the respective organisation is assisting of about 64.6 million person within United Kingdom so their scope is vast. Moreover, it concentrate to deal with one million patients within each 36 hours which involves emergency services, routine check up and others.
Analysis these structure, size and scope is linked to the objectives of the various types of organisations.
The organisational structure , size as well as scope is linked with many kinds of organisation such as profit, non profit and public (Stacey, 2016). As profit organisation huge in size so their scope is to also vast to spread its entities across the world. Also, their organisational structure is functional as in this employees are categorised into the frame work as per their department and they work accordingly. The whole these are establish to accomplish its business goals efficaciously and appropriately.
Critical analysis of the complexities these various types of organisations face within different organisational functions.
As per Berg , the organisational structure are the way through which many forms of organisation are established. Various functions are worked in every kinds of entities with various structure. But the nature of particular structure and interrelationship are differentiated from one another which develops their firm and implication of its operation essential (TKlepac , 2019). As many organisational has many organisational structure like flat, functional, hierarchy and many more that has many complexities and difficulties such as miscommunication, inappropriate understanding whom to report and so on. Also, whole functions of entities are interrelated with another one as it assists all type of organisation to do effective investigation, perform marketing function efficiently and so on.
P2 Explain the size and scope of a range of different types of organisations.
There are many type of organisation and it have different size and scope. Such as Micro organisation, it generally performs with less than 10 individuals as well as is initiated with small amount of capital. It is specialises in facilitating products or services for its local places.
Small organisation, it is define independently owned as well as operated entities which is limited in size (Appelbaum and et. al., 2017). Generally, it have less than 200 staff. Medium organisation, this is considered as non subsidiary as well as independent organisation that employ less than 500 workers. Moreover, it annually revenue will be less than 1 billion. Large organisation, it is regarded as the entities which have at least 5000 staff and its annual turnover should be above 1.5 billion euros. Also, its overall balance sheet is more than 2 billion euros.
P3 Explain the relationship between different organisational functions and how they link to organisational objectives and structure.
Various kinds of organisation structures
In the business world there are various kinds of organisational structures that are functional, divisional and matrix. Functional organisational structure set up in every portion or part of an organisation and grouped accordingly to their purpose (Bucovetchi, Badea and Stanciu, 2018). Respective structure works well for small businesses in which every department rely on talent and knowledge of their workers.
In divisional structure that majorly used by large companies operated in wide geographical area. The major need of respective structure as it can be able to met needs rapidly and more specifically.
The third main kind of organisational structures is a hybrid of divisional and functional structure majorly used in multinational organisations. It allows the benefits of functional and divisional structures exist in one organisation. In context of Tesco they follow the hierarchical organisational structure by focusing on different departments in the business to deal in proper manner. Moreover. The relationship between various organisational function of TESCO are Marketing with research & development, both the functions has to work together. Marketing functions creates information which assists the manager of research and development to do appropriate investigation to achieve profitable outcomes. Marketing manger of TESCO do market research for their product and tell to research & development manager. Therefore, it so research and select appropriate technology for manufacturing as per customer needs effectively. Moreover, if decision are already taken then they have to do modification effectually. Human resource management with marketing, both the functions together works for accomplishing objectives. As manager of marketing aids TESCO HR manager to recruit skilled candidates for its firm to do its work appropriately. By utilising many tools various individuals may able to apply many post and market department helps to identify talented one. As per the organisational structure, the needs of personnel is determined through marketing function and human resource function hire staff based on that.
The size and scope of operations can influence an organisation’s structure considering international and global organisations (Cepel and et. al., 2018). As the operation size as well as scope is bigger or small so the organisational structure are also developed according to that. For example: TESCO is large in size so their scope is also at larger level as they can expand its business operation at vast level this influences its organisational structure.
Organisation’s mission and objectives can determine the functional structure, as the mission as well as objective are also through considering the functional structure of respective company. For example: As TESCO mission is “it make what matters better, together”. And its objectives is to render electronics, groceries as well as clothing products effectively so this influence their functional structure that is hierarchical so that its mission and objective are accomplished effectively.
P4 Identify the positive and negative impacts the macro environment has upon business operations, supported by specific examples
This is essential for entities to analyse macro aspects for operating the enterprises in efficacious and proper way. Macro environment is regarded as the set of external condition which impact the growth of business in positive or negative manner (Safar and et. al., 2018). Mainly, these components are uncontrollable as well as it has an affect into the whole performance of firm. Moreover, it assists to observe and examine atmosphere by using PESTLE analysis that may affects upon entities' s development. This kinds of analysis is done when company enters within new market areas. TESCO have performed this particular analysis for finding both optimistic and pessimistic effects to practices of enterprises that are discussed underneath:
Political factors: As the retail sector firm perform globally, the international political factors largely influence firm's performance. This is define as factors that finds how as well as what government intervenes countries economy (Stott, Stone and Fae, 2016). This consists country's stability, legislation act, tax policy and many more. For example: With Brexit, undertaken company have to goes through may problems as there is maximisation into price of food items that have raised in September year 2016 as well as minimised sterling of pound. In addition to this, the import of food have become so much costly for retailers.
- Positive Impact: Brexit has increased cost that leads to maximise more profit from economic process of pre Brexit to post one.
- Negative Impact: It leads to maximising cost for food import from others nation which is costly for TESCO.
Economical factors: These is regarded as essential point for TESCO as they are vary much likely for leveraging cost, profitability, demand and other. Thus, the entities have to become aware of any modification into policies like modification into taxation or any another aspects that can impact the finance accessibility. For example: Brexit have affect upon TESCO's economic development because of many aspects. That are as follows:
- Positive Impact: Due to existence within internal marketplace and diversification leads towards the success of TESCO at competitive marketplaces which assist them in maximising the share of market through 27.7%.
- Negative Impact: Brexit enhances the audiences spendings because of which many aspects which leads towards reduction into the profit of TESCO.
Social factors: Because of many of social changes, trends shows that audiences within UK has moved towards shopping into bulk as well as one stop shopping. This involves income levels, health conditions and others (Breivold and Rizvanovic, 2018). For example: The changing lifestyle of the person drives towards modifying in its purchasing behaviours which may impact the profit of the TESCO.
- Positive Impact: The chosen entities can bring new technology and innovation which fulfil the needs of clients in effective way for obtaining more profit.
- Negative Impact: In case TESCO fails to attain modification of users requirements it has to face problems in order to survive into respective market.
Technological factors: This is regarded as the factors that shows innovation into technology that affects upon practices of sector as well as develop unfavourable and favourable condition of market (Neelankavil, 2015). This consists automation, innovation and many others. For example: Within UK retail market, the enhancement of technology have bring several new opportunities for company such as TESCO. Also this makes its audiences task easier for customers
- Positive Impact: TESCO use technology into entities which includes home as well as fast delivery for reaching at targeted users which drives towards maximising its goodwill and brand value.
- Negative Impact: Due to lack of new technology adaption in enterprises has impacted undertaken organisation at market location which decrease profit and sales of enterprises.
Legal factors: For running the business practices, legislation like employment, patent, copyright and many more have to be comply into its practices of enterprises. This modification impacts undertaken organisation performance in order to attain goals.
- Positive Impact: The positive affects is that TESCO conduct their operations based upon the FRC which is Food retailing commission which is a strict code of practices.
- Negative Impact: An undertaken organisation has to deals with fraud investor where they have to pay 12million GBP to settle down legislation acts.
Environmental factors: It is the essential factors due to raise into scarcity of raw materials, carbon footprints and others (Adegbite and et. al., 2018). This involves changes into climate, weather and many more.
- Positive Impact: TESCO has motivate their audiences for shopping from websites that is tesco.com where the drivers will not have to usage fuel saving routes as this assists them in collecting useless plastic bags from people and recycle this.
- Negative impact: Recently, TESCO faced the demand for zero food wastages which maximise as well as impact retail sector as it have not adopted such care of environment into their enterprises (PESTLE Analysis of Tesco, 2019).
P5 Conduct internal and external analysis of specific organisations in order to identify strengths and weaknesses.
In order to identify strength and weaknesses the respective organisation have performed SWOT and Porter's five force analysis.
This is defined as tool that is used by organisation for knowing about strengths, weaknesses, opportunities and threats of business (Armeanu, Istudor and Lache, 2015). It identify internal as well as external analysis of market for running business in appropriate manner. They are as follows:
Strengths: Tesco is regarded as leading grocery and supermarket in UK. This has high revenues as well as sales as comparing to other supermarket. It is operating more than 14 countries with 6800 stores. It has large market share in Asian market apart from North Amercia as well as Europe. Tesco has diversified stores such as superstores, express, one stop, metro, home plus and so on.
Weaknesses: There are some weaknesses of Tesco which create problems to run their activities and operations in an effective and efficient manner. The respective organisation profit is declined due to high credit and debt liability. It has adopted low cost strategy which leads to decline in profit margins. Also it was charged for false accounting and misrepresentation of profits.
Opportunities: Tesco has an opportunity to update and form entities associated to online shopping and fast & home delivery services. This leads towards enhancing enterprise growth and profit as well.
Threats: There are few threats for TESCO that works as barriers into its operations is competitors as it impacts their growth as well as performance. Some of their competitors are Walmarts, Aldi and many more (TESCO SWOT Analysis 2019 | SWOT analysis of TESCO, 2019).
Porter's Five Force Model
This is regarded as the model which finds as well as examine five competitive forces which shape each sector as well as it aids to ascertain strengths and weaknesses of industry (Caseiro and Coelho, 2019). Porters five forces analysis of TESCO is discussed underneath:
- Rivalry: The UK super market is so much competitive as there are various entities such as Morrisions, ALDI and others which performs into this. The major competitors compete over goods, prices, promotion etc. which developed the level of its similarity vary high. So, the competitive rivalry for TESCO is high.
- Bargaining power of buyer: The bargaining of buyers is very higher as the switching cost within respective sector are low. So, buyer may easily switch to other one in case their requirements are not fulfilled and happy with respective organisation product range, client services and others.
- Bargaining power of suppliers: The bargaining power of supplier is low as TESCO its products to above 1000 suppliers across world. So, in simple way they may negotiate their product price while choosing that suppliers which provides goods at high quality.
- Threats of substitution: The threats of substitution into supermarket is medium as because of economies of scale affects, TESCO may provides similar products at lowest price, developing them in more attractive way to audiences. So, clients may buy similar types of goods form another supermarket like ALDI and others.
- Threats of new entrants: Within supermarket, the threats of new entrants is low as firm has to invest considerable monetary resources for setting up its presence within respective market. But TESCO, required not to worry about it as for reaching up to its market share as new firm has to put additional efforts.
P6 Explain how strengths and weaknesses interrelate with external macro factors.
The external macro factors refer to the ones that affect the functioning of the organization like demographics, economic, technological, social and political factors (Laursen and Thorlund, 2016). Both micro as well as macro factors significantly impact how an organisation operates and therefore these factors should be considered carefully before making any decisions as a prior analysis will help Tesco in understanding the dynamic nature of the environment. The interrelation of strengths and weaknesses with these external macro factors is described below -
- Political Factors – Global political factors like tax rates, stability of the country influence the overall performance of the company. The strengths and weaknesses of the same are explained below -
- Strengths : With an ongoing instability of finances in the world, the governments of several countries are motivating the retailers to create jobs for the local residents. Therefore, Tesco has an increased demand for its products.
- Weaknesses : High tax rates can pose to be weaknesses for Tesco as then it will have to pay more prices to import the materials. Also, the customers won't be able to purchase the products.
- Economic Factors – Economic factors like demand and supply, profits, prices etc. should be Tesco's main points of concern as they influence the functioning of the company.
- Strengths : Factors such as diversification and internationalization have proved to be the key strategies in company's success.
- Weaknesses : Decline in the overall disposable incomes of the people, the people are not able to afford products of high prices.
- Social Factors – Various trends have shown that people in the United Kingdom have moved more towards shopping the products in bulk rather than buying one product at a time (Harmon, 2019).
- Strengths : Customers are becoming more health conscious with time. Hence, the company has increased the number of non-food items and kept them for sale
- Weaknesses : Not adopting to the eating habits of the customers will act as a weakness and lead to a loss of customers.
- Technological Factors – Technological factors include introducing and implementing the latest technology so as to improve the working environment as well as the customers' experience.
- Strengths : Implementing new technology will lead to less billing time, facilities for home delivery which will in turn help retain customers and attract more potential customers.
- Weaknesses : Not adopting to the technology will lead to lagging behind in a highly competitive environment.
- Environmental Factors – These factors include doing business in an ethical manner, availability and scarcity of raw materials etc.
- Strengths : Producing and manufacturing eco friendly and following ethical practices will lead to more customers buying the company's products.
- Weaknesses : If Tesco will not follow various ethical environmental practices, it will lead to a decline in the sales and overall customer base of the company.
- Legal Factors – These factors include health and safety, consumer rights and laws etc.
- Strengths : Following the legal laws and regulations will help the company to sustain itself in a highly competitive environment.
- Weaknesses : Following legal regulations of each and every country can get a little tricky as different countries have different set of legal laws.
As per the above report, this is important for organisation to analyse it as this assists entities to ascertain opportunities and threats, provide guidance for growth, meeting competition and others in effective and efficacious way. Moreover, there are different kinds of organisation such as profit, non profit and public organisation all have different size, scope, structure, objectives and many others. Also, the micro, small, medium and large organisation are distinguish from each others. there are various kinds of organisational structures that are functional, divisional and matrix. All organisational function are interrelated with one another. Also, the PESTLE analysis are performed to know the positive and negative impact of external environment. Take assignment help service from Instant Assignment Help. They are the best assignment writing service providers in the UK. Their experts are highly qualified and skilled. They will provide you with a plagiarized free assignment at a low price which will help you in achieving A+ grades. So contact Instant Assignment Help for the assignment writing service.