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Unit 1 Macro Business Environment Assignment
Diploma in Business
Unit Number and Title
Unit 1 Macro Business Environment
A - Business environment
Describe the purpose of each of the chosen organisations
As per the view ofKelly& White(2015), the profit organisation concentrating on the organisation profit are termed as the Private Limited organisations. On the other hand, the non-profit organisations such as the NGO s are termed as the public organisation those use to run with the help of the public intervention. As per the requirement, the profit organisation has been chosen as Morrison’s (Morrisons, 2016)and the non-profit organisation has been chosenas Cry NGO in the UK(Cry, 2016).
The purpose of the Morrison’s is to serve the UK customers as well as the Global customers withthe best quality product with the best offering of the price to strengthen their brand name and also make aprofit through their business operations (Morrisons, 2016). On the other hand,the purpose of Cry NGO is to support the child rights of the underprivileged children in an effective manner (Cry, 2016). It is the mission and the vision of Cry to make the people responsible to take care of the deprived children and also to bring the difference in their life by volunteering for CRY for the various charity work so that they can make the life of eh neglected and the deprived children better like the other children in the society.
Explain the main differences between their types and purposes
Thus, the key difference in the type of the business operations is the profit and the non-profit organisations. Morrison is the profit organisation which is serving the people of the market by the process of the profit generation for the organisation. On the other hand, with the public intervention and the UK government intervention, CRY is associated with the concept of serving the underprivileged children in society without concentrating on the profit generation for the organisation.
Explain the main differences between their size and scopes
Morrison’s is the fourth largest chain in a super market in the UK. Till the year 2014, 125,000 number of employees working in Morrison’s have been reported. Until the end of the year 2015, 569 stores have been opened by Morrison’s to serve the UK market in an effective manner(Morrissons, 2015).They have more than 9 million customers in their customer database. On the otherhand,the CRYFoundation is spread all over to UK, USA, and the India market with the unlimited Voluntary help from the people of the different nations. So, from the size and the scope, CRY Foundation is leading ahead than the Morrison’s in an effective manner(CRY, 2015).
Describe and analyse the link between their structure, size and scope and their offered products and services
Thoughthere is a difference in the structure and the offered products and servicesbetween the mentioned two organisations, they have a strong link between them. Morrisonis closely associatedwith working with NGO to offer their support withfood products and other investments in the betterment of the NGO like Cry and others to reflect their corporate social responsibility. Therefore, the foundation like CRY is dependable on the big giant company like Morrison and others regarding the voluntary help for the betterment of the lifestyle of the child population that they are targeting o improve further.
B - Business environment analysis of Morrison’s
To discuss this section, Morrison has been considered for the in-depth analysis. As per the view ofCosh, et al. (2012), organisation structure is the perfect assembly of the different departments in the organisationin a systematic way to contribute to the overall goal of the organisation with the different business functions in an effective manner. There are many organisation structures such as simple structure, functional structure, Divisional structure, Matrix structure, Team based structure, Bounaryless organisation, Mechanistic organisation, and the Organic organisation. As per the view ofPersson (2013), in Functional structure organisation, the specialists from the different functional departments are assigned to work one or more projects led by the different project managers.
As Morrison’s is operating their business with the different functional activities, the functional structure is strongly followed in the organisation. The key business functions tat they use to concentrate are Product stewardship, Supply chain integrity, and the Satisfaction for the stakeholders with the quality good. Apart from that maintaining the financial report also is the important business function that they use to perform with efficiency. With the help of the Product stewardship, the organisation use to focus on the specialisation in the innovation of the products to meet the demand of the customers, maintaining the food quality and food safety factor of the foods that they are offering, and the maintaining the responsible sourcing guidelines. The supply chain integrity is strongly connected with the operations like maintaining the fair and ethical trading standards and also to being loyal and decent customers to their suppliers. The last business function is to meet the satisfaction of the stakeholders by delivering their promise with offering the best product and the best service in the market with the reasonable, pricing strategy in an effective manner(Morrissons, 2015). The results of all these business functions regarding the profit gain are strongly maintained by the Finance Department Thus, the concept of performing the departmental work by more than one project leaders are referred to the Functional structure of Morrison.
Thus, the organisation structure can be changed with the help of the change in the interrelationships between the organisation functions in an effective manner. For example, if the specialist's groups in Morrison is not performing their tasks as per the organisation structure, then the interdependency of the origination is likely to get raise, this , this will influence for the matrix structure development in the organisation. As per the view of Burton & Obel (2012), the change in the structure may change in business operations with the better productivity and the better understanding of the market requirement in an effective manner. At the same time, the change in the organisation structure also mat demotivate the employees to work in a new culture as the change in structure influences the change in the organisation culture.
Section 1: Identify some positive and negative impacts of the macro environment on the business operations
The positive impacts of the macro environment factors in the business operations area as below:
- The change in the market trend based on the social factors such as the eradication system in the UK have a positive impact on the more customer segmentation and the larger opportunity to attract more customers for the effective growth of the company.
- The stable economic condition also have the strong impact on the business operations of Morrison with the better opportunity to grow the business in the market with the advancement of the technology usage by the company, the online mode of shopping offered by the company has been well accepted by the UK customers for the more discussion and the hassle free shopping without the waiting time in supermarket queue are the positive factors influencing the business operations(Cavusgil, et al., 2014).
The negative impacts of the macro environment factors in the business operations area as below:
- The political and the legal constraints can be recognised as the negative impacts to influence the business operations of Morrison in a negative manner.
- The legal and the political factors use to create an obstacle for the opening of the new supermarkets in the different UK locations.
- Further, the food law with the minimum calorie and the fat-free food usage also use to create an obstacle for the effective growth of the business of Morrison’s in a negative manner(Cavusgil, et al., 2014).
Section 2: Conduct an internal and external analysis to identify its core strengths and weaknesses
The internal and the external analysis can be done with the help of the Porter’s five force analysis as below:
- Power of competitors: The supermarket in the UK is highly dominated by Tesco, Asda, Sainsbury and Morrison. So, they are the great three competitors in the market with whom Morrison’s is struggling with their low product price to sustain in the market and also to increase the market share in an effective manner(Morrissons, 2015).
- Threat of substitutes:The other super stores and the grocery store in the UK can be recognised as the threat of the substitutes. But m with the varietyproduct offeringand the best customer service,Morrison is the winner in the market.
- Bargaining power of buyers:As there are many other alternatives in the market, the customers (buyers)use to offer the high threat to the business operations of Morrisson. So, Morrisonhas to continuous use the product innovation with the affordable price range to attract more customers.
- Bargaining power of Suppliers: The own manufacturing firms of Morrison’s is the positive strength factor of the business operations. So, the threat from the suppliers is low for the company(Morrissons, 2015).
- Threat of new entrants:The threat of the new entrants is low in UK market as theopening of the new company by following the strategies of thefive big supermarket players are difficult to imitate. Thus the strength of thecompany is the competitivepricing and the variety ofthe products offering to the market. The negative factor is the presence of the competitors with their innovating as per the demand of the market(Morrissons, 2015).
Section 3: Explain how these strengths and weaknesses are linked to the external macro factors
The strength factors and the weakness factors are the outcomes of the macro environment analysis. The threats and the influencing internal and the external factors use to have a strong impact on the business operations in an effective manner. Thus, these influencing factors use to raise the positive and the negative facts. The political, legal, social, economic, and the environment factors and the impact of these factors use to shape up the business operations to cope up with the demand and the change in the trend of the market(De Castro, et al., 2014). In this business operation execution, the strength and the weakness factors have the great influence to manage the operations. Thus, it can be stated that the strength and the weakness factors are linked with the macro environment analysis is a broader manner.
Section 4: Apply some analysis models -i.e. PESTLE and SWOT/TOWS- to develop an in-depth understanding of the impact of the macro environment as well as to justify how this affects organisation’s decision-making processes
It has been observed that the Macro environment factors have the strong positive and the negative impacts on the business operations of Morrison. The PESTLE analysis is the perfect tool to identify the impacts in an effective manner.
- The impact of the political factor: As Morrison is operating their business in the UK, therefore, the political rules and regulation of UK havea strong impact. The legislations concerned with the food disposal is strong in the UK. So, Morrison is associated with the step of the less food wastage. At the same time, the political factor for the offering of the low-calorie food also is focused by Morrison in a great manner. Thus the restriction of offering the low-calorie food without the usage of the high-calorie food is one of the constraints of the business operations.
- The impact of the economic factor: the prediction of the economic condition of UK is difficult. Thus based on the prediction, the sales forecast is difficult to be assumed. This is another important negative impact for the business planning to be done by the management of Morrison’s(Morrissons, 2015).
- The impact of the social factor: The change in the market trend with the change in the demand of the market has the strong positive impact regarding the better opportunity for the business to grow in an effective manner. Further, the slow eradication system in the UK also uses to influence for the versatile segmentation and the positioning of the products offered by the company which is the positive impact on the company(Morrissons, 2015).
- The impact of the legal factor: Morrison strongly maintains the permission for the local authority to open the shop and the supermarket. This is another constraint faced by the company in an effective manner.
- The impact of the environmental factor: The environment conservation is the important aspect that is being focused by Morrison. Thus the positive impacts used to be maintained as the customers are becoming attracted towards the business dong the ethical business. Further, strong CSR maintained by the company also use to attract the huge customer base towards the company.
- The impact of the Technological factor: the advancement of the technology with the introduction of the online Morrison store has the strong positive impact on the business operations as customers are becoming attracted for the online and hassle free shopping through the online mode.
- The effective supply chain with their manufacturing firm
- Large product portfolio
- Have over more than 400 stores in UK market
- Offering of the competitive pricing with the excellent discount for the online shoppers
- Limited geographical reach of the UK Market
- The threat from the competitors in the Market(Morrissons, 2015)
- International expansion
- Growth in the market with the organic products
- Increasing number of the competitors in the market
- Increase in the taxes
- Rise in the labour cost as per the legislations(Morrissons, 2015)
Thus, the management of Morrison’s need to analyse these factors in an effective manner so that they will be able to take the perfect decisions for the growth and the betterment of the organisation with the presence of the competitors in the market.
Thus, from the entire discussion, it has been understood that the macro event analysis has been done with the help of the Pestle analysis and the internal analysis has been done with the help of the SWOT analysis model. Apart from that the Porters’ five forces also have been done to understand the other external factors influence on the business operations in an effective manner.With the help of the macro environment analysis, it has been identified that the impact of the legal and the political factors are strong in the UK as UK legislations has influencedthebusinessoperations of Morrison to implement the strategy for the less wastage of the food and also theusage ofthe low-calorie food in their product offering.Thus, the decision making for the food product development of the company is based on the product innovation to meet the demand of the market as well as to abide by the rules and the regulations of the market in aneffective manner. The macro environment analysis based on the competitor's analysis also use to influence the decision-making process to take the required strategic decisions such as competitive pricing usage, adaptation of the product innovation with the effective marketing campaign along with the effective customer service use to target more UK population in an effective manner.
Apart from that the internal analysis with the help of the effective SWOT analysis, Morrison cantake the effective decisions to meet the objective and the goal of the organisationregarding offering the quality good to the UKcustomers with the reasonable price. With the effective supply chain along with the concept of the own manufacturing firm, the strength factor of Morrison of having the strong supply chain use to facilitate the decision-making process of the company to focus on this section of the supply chain to bring the competitive advantage. The weakness factor of having the low international expansion has influenced the decisions making theprocess for the further international business with the online shopping mode to reach the global customers. Thus, this decision-making process also use to help the business objectives to reach the global customers in a strategic manner. The opportunity for the global expansion and the threat factor from the imposed taxes from the different regions of the business trade also use o influence the decision-making process to accomplish the business objectives in an effective manner.
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