Unit 1 Organizational Purposes of Business Environment Assignment

Introduction

On forming any business organization all the strategies of the company have to be worked out. The organization has to make decisions regarding the future prospects of the company. This is a solution of Unit 1 Organizational Purposes of Business Environment Assignment that describes about Developing business strategy can help company cope with aging systems and limited resources that can lead to fragmented business solutions. The factors on which the development and sustainability of the business depends are social, cultural, economic, legal and technological. The environment in which the business is operating also determines the success of the company. There is a lot of risk involved in the financial matters of the company. The first task in the assignment deals with the purpose of different types of organization. It also mentions the objectives of different stakeholders in the company. The responsibility of the various elements of business is also mentioned. The second task of the assignment deals with the allocation of the resources in the company and the effect of monetary and the fiscal policy on the company. It also briefs us about the impact of competition and the pricing structure and the output of the product. The various marketing forces which shape the organization have also been listed. The cultural environment and the behavior of the organization has also been mentioned. The significance of the international trade in the European market have also been listed in the third task. There are various global factors which affect the market of the UK. The policies of the European Union affecting the businesses have also been list.

Task 1

Understand the Organizational Purposes of Businesses

I’m an assistant of a local council which is planning to give support and help in the development of different types of local business.

1.1 Identify the purposes of different types of organizations

As a part of the member of support and development plan I have prepared a report on local business that is currently operating in our area. An organization is defined as a formal collection of different duties, relationship and leadership which help in achieving the defined objectives. The different types of organization that are involved in business activities are classified as private, public, voluntary and government. The mission and the vision of the company are listed as the primary purpose of the company. The company strive to fulfill the needs of the company all the time.

• Teach first: it is public sector organization that is controlled by the government. As the name suggests the organization is responsible to the entire public. The organization teach first provides high level training and qualification to the skilled graduates. They are responsible for making life changing transformation in the lives of the young individuals.
• INEOS: INEOS is a private sector organization which is controlled and managed by the private individuals. They are not government organization and run to make profit for the shareholders. INEOS is a multi-national companies which deals in the chemicals. This company makes huge profit and it operates in a large number of companies.
• The Child Support Agency: The child support agency is the government sector organization which run for the welfare of the people of the country. The child support agency deals with supporting the needs children. (Slide Share, 2007)

1.2 Describe the extent to which an organization meets the objectives of different shareholders

The stakeholder in our organisation is any person, organization or the group who affect the action or the course of the organization. For managing the company in an efficient way it is necessary to meet all the demands and expectations of the stakeholders. All the demands of the stakeholders should be assessed and the demands must be met on time. It is really important that the organization meet the objectives of all the stakeholders. The objective of the different stakeholders are listed below:

• Owners: The most important stakeholders in a company are the owners of the company. They are the ones who lay the foundations of the company and work very hard to make it successful. Owner put in their best to see their company flourishing and the value of their share increasing. 
• Customers: Customer demand the value for their money. They want high quality product from the company at the price they are buying it.
• Employees: They are very important asset to the company as they work hard for the success of the company. In return of their work the company provide them with livelihood. They also want job security, salary hike and bonuses. They want the company to provide them with the opportunities for improvement.
• Suppliers: The suppliers want bulk orders from the company on a regular basis. The suppliers wan the company to pay them on time and value their products.
• Government: The government want the company and organizations to flourish in their country. The new companies provide more employment to the people and help in collection of lot of tax. (Kessler, 2016)

1.3 Explain the to meet them responsibilities of an organization and strategies employed

It is necessary for our organization is to communicate effectively with all the stakeholders such as owners, employees, customers and the suppliers and the government. All the stakeholders have a variety of expectation from the company and they expect from the company to fulfill it. The employees expect the company to pay their salary on time and give then salary hike. They want the company to help them grow personally and give them rewards for their good work. The government expect the company to pay their taxes on time. The management should list the positive and the negative effects of both the internal and external factors of the company. The legal policies related to the company as well as the economic factors have the direct effect on the stability of the company. The business ethics involved in the business and the proper governance of the business is one of the social responsibility and the liability of the business. Business morality refers to the fair and just decisions taken in the company and the ethical attitude of the employees and the managers. Stakeholders want the company to take full responsibility for the actions and maintain clear records of all the transactions they both deal in. they also expect the company to respect all the cultures and norms of the society. The company should make sure that all their actions contribute to the success of the company along with making a positive impact on the society. The company should work towards the welfare of the society on the whole. (Reinhart, 2016)

Task 2

National and Market Environment

In this task we are making the report for an organization that is supporting new businesses and start-ups in UK. We have to tell the potential clients, nature and the environment of new organization in the business market.

2.1 Explanation of how economic systems attempt to allocate resources effectively

The economic system is the result of interaction for the legal and social work in the effect of economy between the individuals, groups and the government. The major function of our organization is solving the fundamental problems that are listed. For example, there is a shortage of resources but the needs are so high which result in the exhaustion of the resources. This creates an imbalance in the system. The major economic system used all over the world on a large scale which are called as the system of free markets. In these systems the role of the government is very limited but it is an important one. In this the government takes the full authority contract law and responsibility of the economic functions. In the above mentioned system the elements used for resource allocation by the government differ greatly. The mixed economy uses the combination of both these processes and plans a market which is free. In Mixed economy the important decisions pertaining to the allocation of resources are taken by the government while the remaining one are taken by the public. The vital role of resource allocation is played by the business plan in order to achieve all the aims and objectives of the company. (Mica, 2014)

2.2 Assessment of the impact of fiscal and monetary policy on business organizations and their activities

These policies discuss the present and the future strategies of the company. The company first of all selects its potential competitors on the basis of their sales. It also finds the economic and the geographic reach of the company.in these all the competitors listed are making a great deal of profit. The strategies of the finance and marketing are listed below.

The financial sanding of the company is compared with the competitors in a comparative analysis on the finance. The financial assessment of all the department of the company is listed. The main aim of this analysis is to find the position of the company and the competitors in the market. The comparison of the stocks helps in the understanding of the performance of the company. Purchasing and selling of the goods across the globe is known as international trading. International trade is the vital framework of the trade in the commercial markets world-wide. The company extends their territories and business in other countries to make a larger profit and to get internet exposure to their goods and services instead of just limiting them to the local market. One of the major advantage of the international trade is the low expenditure in the developing countries. The wage of the workers is also very low in the developing nations and this turns out to be the big advantage to the company. There comes a huge difference in the manufacturing cost of the product by the decrease in the labor cost. Now the company can sell the products at the lower price which let them have a competitive advantage over the other companies. It lets the company to expand and sell their products thought the world. This step is very important in sustaining the company in international marketing. (Mica, 201cc4)

2.3 Evaluation of the impact of competition policy and other regulatory mechanism on the activities of an organization of your choice

The purpose of different organizations is different. The purpose for which the organizations exist is referred to as the goal of the organization. Office of fair trading was set up by the government of UK which looks after protection of the consumer and the regulation of the economic policies of the government. The major function of the office of fair trading is make the companies work well through the involvement of customers, employees and the shareholders. Office of fair trading makes sure that there is no unfair trading taking place in the market. Department of the business innovations and the skills takes control over the customers and the companies in the business market in UK. There ae various laws for controlling the competition in the country. It makes sure that there is a healthy competition among the different companies. The government can interfere with the matters of the business when it is the question of the national security and financial instability. Competition Authority also takes care of the fair trading within the company and the existing competition. (Choudhary, 2016)

2.4 Explanation of how market structures determine the pricing and output decisions of different decisions

The price of any commodity in the business market depends upon the competition. For finding the price and the output of the products and the entities of the company the description of company in the market is determined. The various market structures under the existing competition between the companies there started discrimination on the basis of monopoly, duopoly, oligopoly and the competition. Oligopoly, monopoly and the effect of competition in the market, dual monopoly and the number of transistor in the nature of products and element and information of the products in the market etc. The economists of the company suggest the way of maximizing the profit of the company. Many marginal decisions of the company are taken by the managers and also suggests the major difference of the company between the markets. The efficient pricing strategy helps us in making a balance between the pricing and the output of the product. The structure of the market is determined by the number of sellers and the buyers in the present ay market. The various type of market structure is mentioned below:

• Monopoly: It is the structure of the market where a single company has a complete monopoly. It is the only provider of the goods and services to the customers so the pricing and the output is completely determined by the company. They have a monopolistic approach and the company can change the price whenever they desire as they have a complete hold over the market. The customer will still buy the products as they do not have any other choice.
• Perfect competition: It is the structure of the market where there are number of sellers of the products and then the price and the output of the products is determined by the demand of the product in the market. In the competitive market it is the buyers that determine the price of the commodities and the customer compare different products available in the market.
• Oligopoly: It is the type of the structure where there are some large sellers and some of the small ones. In a way the large sellers control the pricing and the output of the market. The big sellers ay sometime charge the higher the higher price but they would advertise the product in a very good way. (Kangda, 2011)

2.5 Illustration of the way in which market forces shape organizational responses using a range of examples

There are wide ranges of the market forces that the organization is required to address but the most common factors that dominate the business world today are:

• Participation of the customer
• Availability of information
• Demand of information and the cost of pressure

These are three important issues which are concerned. Many organizations are interested in collecting the payment on purchase of the products or services of the company. These businesses allow the return and the refund of the products. Sometimes the returns get very hectic when there has to be a lot of paperwork and long process of acceptance of issue of status of refund. All these steps and the processes can affect the business prospects of the company. While taking the important decisions of the company the company should that organization is ready to take the important decisions that has an effect on the performance of the business. This increases the stability of the company in the market in the present world and the future. This will help in the process of strategic decision making to lead the company I the present times. This gives an advantage to the business leaders to dominate the business markets. (Herring, 2016)

2.6 Judgement on how the business environment and cultural environments shape the behavior of an organization of your choice

Business and the cultural environment shape the behavior of our organization. The different types of the business environments are the economic and the non-economic. The economic environment covers the various economic systems, policies and the different economic conditions. The non-economic environment covers the various social, geographical, demographic, natural, political and technological environment. Our organization funds any other start-ups and this primarily depends upon the cultural and the business environment of the country. The start-ups belong to many other countries and the economic environment is not same in all the countries. Per capita income of various countries differs. The different polices like fiscal, economic, monetary and industrial policies of all the country differ greatly. The criteria for the import and export of the different countries also differ to a large extent. The various social factors affecting the environment of the business are traditions, customs, life expectancy and the financial conditions of the country. The political environments that effect the businesses are the policies of the government and the reaction of the community. All these factors greatly affect the strategies of the business. The technological environment affects the design and the infrastructure of the company. These days the technology rules the functioning of the company. The natural factors also affect the functioning of the company such as natural resources, weather, climate and the locations of the company. (Hashmat, 2011)

Task 3

Global Factors Affecting National Business Activities

I’m working in an organization which supports other start-ups that are planning to expand in the market of UK. I’m preparing a report about the potential clients and the effect of global factors on the economy of the nation.

3.1 Discussion of the significance of international trade to UK business organization

International trade is very important for UK business organizations as these days as no country these days can itself produce all the goods required by it. Some exotic products are produces only in the specific regions so these need to be distributed. This export and import is only possible through international trade. In the absence of trade the businesses would not flourish and would be limited to a region. International trading has removed the boundaries of nations and made everything available at UK and worldwide. The reason why international trade is so important is listed below:

• Widens the market: If the companies have to just utilize and produce the products within its own country then the potential and exposure of the company would be limited. By expanding the company to international markets the company gets the trade in other countries and the profit of the company increases. 
• Lowers the production cost: By Trading in other countries the company also has the opportunity of lowering its production cost. The wages of the labors is low in the developing countries as compared to the developed countries. The raw materials can be purchased in the developing country like India and manufactured there and can be sold at higher prices in UK and other developed countries. It saves a lot of money of the company and help them reap increased profit.
• Availability of materials: If there was no international trading then many products we today use in UK would not be available. Many everyday use products are not available in UK and exported from outside. The raw materials for many companies are exported. Many popular fruits like banana and mangoes require hotter climate and cannot be grown in the cold weather of UK. Without the international trade especially food trade many countries would face the scarcity of food resources. (Lesley, 2016)

3.2 Analysis of the impact of global factors on UK business organization

The businesses in the UK market are affected by the competition and the global factors. Understanding these factors is essential for developing the businesses. Global factors influencing the business in the UK market are as follows:

• Social factors: These factors deal with the changes in the social structures of the country. These factors make us familiar with the behavior, taste and the lifestyle of the people. Age and the gender of the people also determine the buying pattern of the people. The strategies of the business have to be formulated keeping the people in mind.
• Legal factors: This factor covers the legal and the governmental regulations binding up on the business. For the successful running of any business it is important that the business follow all the norms of the government. The company should abide by all the rules of the company.
• Economic factors: These are the changes made in the global market. Increase in the income of the people raises their living standards and hence increases the spending power of the people. The demand of the product increases and hence the production of the product rises. The other economic changes which effect the business organizations are the interest rate, inflation and the wages of the employees.
• Technological factors: These factors influence the business by bringing in the new innovation and inventions in the business. This enables the business to reduce the work of manpower and hence reduce the cost of production. The technology makes the business transactions lot easier. The companies which are technologically developed have the competitive advantage over the others. Technology is the major driving force of the companies these days.
• Political factors: These factors concerns with the various government policies. It tells us how the business is affected by the government in a country. The companies who operate in UK have to abide by all the rules of the European Union. The political framework of the country has to play a major role in the running of the business. (Dudovskiy, 2013)

3.3 Evaluation of the impact of policies of the European Union on UK business organizations

The major policies of the European Union that have affected the business market of UK are given below:

• Policy related to employment: It is the duty of the government to stimulate the employment and promote the new businesses in the country. Presently the government is lying main focus on the development of the new businesses to make UK stand in the international trade market. The government is heavily funding the businesses ventures so that UK can give stiff competition to other countries in the international market. Development of new business provides employment to a lot of people. It enhances the economy of the country. The government has formed the new policy for the people who are finding difficulty in searching for a job termed as “New Deal”. It provides the people appropriate training for starting the new business.
• Policy related to inflation: It is the duty to ensure that there is no sudden hike in prices of the commodities. This is achieved with the help of the Bank of England through the monetary policy of the country. The bank of England sets the interest rate for the company. The government raises the interest rate if there is the risk of people spending too much. The government also raises the prices of the commodities. With the increasing interest rate it becomes difficult for the businesses to borrow money. They businesses have to spend less to let the money be invested in different purpose. (Nancy, 2013)

Conclusion

The operation of the company can be affected by culture of the organization which is shaped by the leadership style and the management style of the organization. The motivation of the employee is really important as it keep the employee committed work. In the present day business teamwork is essential as it brings the innovation in the company. In the first task, the purpose of various organizations has been listed. The objectives of the different shareholders have been given. In the second task there is a detailing about the allocation of the resources of the company and the impact of fiscal and monetary policies on the business. Third task deals with the significance of international trade in the European market. The different policies of the European Union which affect the business market have been listed.

References

Choudhary, S., (2013), competitive policy, [Article], Available: http://www.slideshare.net/Shohail/be-wk5-competition-policy [Accessed 04 July 2016]
Dudovskiy, J., (2013), Impact of global forces on UK business organizations, [Article], Available: http://research-methodology.net/impact-of-global-forces-on-uk-business-organisations/    [Accessed 04 July 2016]
Herring, K., (2016), how do market forces shape organizational responses?, [Article], Available: https://www.quora.com/How-do-market-forces-shape-organisational-responses-Why-does-it-happen-so [Accessed 07 July 2016]
Hashmat, M., (2011), judge how cultural environment shape the behavior of organizations, [Article], Available: http://www.enotes.com/homework-help/judge-how-business-cultural-environments-shape-290189   [Accessed 03 July 2016]
Kangda, I., (2011), how market structure determine the pricing decisions of businesses, [Article], Available: http://www.enotes.com/homework-help/how-market-structures-determine-pricing-decisions-290148   [Accessed 03 July 2016]
Kessler, J., (2016), what are shareholder objectives?, [Article], Available: http://smallbusiness.chron.com/ethical-responsibilities-organization-15528.html   [Accessed 07 July 2016]

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