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LSST Unit 1 - Business Environment Assignment
LO1: UNDERSTAND THE ORGANISATIONAL PURPOSES OF BUSINESSES
Q1.1 Identify at least four different types of organisations that exist in the U.K.
An organisation is an institution which is either owned privately or along with the public and government. An organisation is associated with either a product or services which is being traded under the guidance of an executive leadership to gain defined goals.
Four different types of organisations existing in the UK are:
1. Public sector organisation: They are run by the governments for providing to people. People pay taxes to the government, which in turn invests in providing infrastructure to the public at large.
2. Private sector organisation: They are run by private individuals. Examples of private organisations are sole traders, partnership firms, companies (public & private), and franchisee. They run private companies with major focus on profits, services, growth.
3. Voluntary groups: These are not owned by any individual or individuals. They are run under the guidance of the board with selfless interests.
4. Public private partnership: These are companies formed by the government and then bring in a private entity to run day-to-day operations. They are governed by the board leadership.
5. Sole trader: Business owned by one person
6. Franchise: This is a private business company which adopts the operational rights of a different company.
Two organisations chosen are Tesco and HSBC.
Reason for selecting the Tesco is its sheer size of retail development and its consistent expansion drive in the Asian and other markets around the world. It sells multiple products through its hundreds of retail stores to wholesalers and consumers. It is preparing its entry in the Indian retail market as the FDI market has opened up. Tesco is listed in the UK stock exchange market.
Reason for selecting HSBC is its global presence which has helped to garner real time news data about major investment markets and offers various service to their clients around the world. HSBC is incorporated in England and Wales in the name of HSBC holdings and its entities around the world offers range of services, which becomes part of the holding company HSBC. HSBC is listed in London, Paris, New York, and Hong Kong stock exchange market.
Q1.2 Select an organisation of your choice and describe the extent to which this organisation meets the objectives of its stakeholders.
The organisation selected is HSBC bank.
A stakeholder is an individual, a company or a group which has some direct or indirect interest or concern in a listed company. It can be a stakeholder by buying shares of the group or by taking an equity interests and having some advisable role to play in its day-to-day operations.
Primary stakeholders of HSBC bank are its customers, clients, governments, employees, owners, and the communities. HSBC helps customers by selling their services to them and offering them value for money products and after sales services. It helps its clients by giving them optimum return on their investments made into the bank and reliable advice for investments. It helps the government by properly and loyally paying taxes on time, which in turn helps the economy to remain progressing. It helps by investing in corporate social responsibility segments and help communities, especially in areas which are directly affected by the company’s operations. It helps its employees to have a well-paid job with substantial fulfilment of the employee’s personal and financial goals. It also helps its employee by offering job security, some kind of status and growth in business. Finally the company helps its owners who have invested capital in it by giving them profits and growing the business management in a consistent manner.
HSBC bank also has different objectives in various countries it operates in. It has social corporate responsibility division in all countries it operates in and thus participates in social activities and fulfils its obligations.
In addition, it operates on a global level and hence, it shuffles clients’ investment decisions and provides them a global vision for their overall investments and strategy. In this way it fulfils its domestic as well as international clients’ responsibilities.
By taking part in international negotiations between mergers and acquisitions, it manages to build various economies and fulfils its requirements towards countries in which it is present, by bringing in revenues.
Q1.3 Explain the responsibilities of the organisation you selected in Q1.2. In addition, explain the strategies employed to meet these responsibilities.
Various responsibilities of HSBC bank towards its customers is to offer them best services in banking, investments, advice, loans, equity markets, stock markets, etc. The banks responsibilities towards its owners are to make profits in the business and keep looking for new avenues for investments and growth. The banks responsibilities towards the respective government are to make substantial contribution to the economy by participation in the market. The banks responsibilities towards its employees are to offer them good development in the company, good paying jobs fulfilling their personal and financial goals. The banks responsibilities towards their clients are to offer them the best of services as investment advice, services, wealth management services, etc. The banks responsibilities towards the communities is to give them back and more if they have lost something as a result of their operations.
The bank has certain milestones for achievement to offer profits to the owners who have invested capital. This is being done by excellent practice on a daily basis and excellently managing the entire process, and perceiving any forthcoming risk to avoid failures, etc. The back designs some reward programs for encouraging employee participation which in turn will produce good results. The employees who are promoted depending on their performance has a sense of satisfaction and growth in their life. The bank has some social responsibility programs which invests in education, healthcare and providing basic infrastructure to the less deprived in small villages. The bank has the best hired portfolio managers who advice their clients to develop life-long relationship with them for sustained investments. The bank offers some services compared to their competitors for generating life-long banking customers.
LO2: UNDERSTAND THE NATURE OF THE NATIONAL ENVIRONMENT I
Q2.1 Using a country or countries of your choice, explain how two economic systems attempt to allocate resources effectively.
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