You are on page 1of 14

Assignment on Business Environment

Name: Abdullah Al Mamun
ID NO: 32422841484

Table of Contents
Introduction.............................................................................................................. 1
Task 1..................................................................................................................... 1
1.1 Background, Mission and Vision of Armani...........................................................1
1.2 Identify the key stakeholders of Armani................................................................2
1.3 Strategies it adapts to meet their needs and expectations......................................3
| Page

Task 2..................................................................................................................... 4
2.1 Advantages and Disadvantages that organisations would handle in a dissimilar
economic system................................................................................................... 4
2.2 Impact of fiscal and monetary policy....................................................................5
2.3 Impact of Govt. rules including competition policy..................................................6
Task 3..................................................................................................................... 7
3.1 Market structures based on the Price and Output..................................................7
3.2 Focusing market forces shape organizational responses using examples.................7
3.3 Business and Cultural Situations form the character..............................................8
Task 4................................................................................................................... 10
4.1 Importance of International Trade and Globalisation............................................10
4.2 The role of World Trade Organisation (WTO) emerging markets BRIC countries......11
4.3 Impact of policies of the European Union on UK business organisations.................12
Conclusion............................................................................................................. 12
Reference(s).......................................................................................................... 14

| Page

Introduction
Everything exists in the world in environment and the effect of environment of Business
much more important to make profit and make law relating business. It also called which
factor influence the business as well as organization are considered as business
environment that formed through formal and informal variance. Business Environment can
be mention as internal and external. In this assignment, I try to present the Environment of
the Business with providing criteria.

Task 1
1.1 Background, Mission and Vision of Armani
Giorgio Armani S.p.A. is the name of an Italian brand and fashion house founded in 1975 by
Giorgio Armani which make sure designs, productions, distributes and retails of attractive
men's suits as well as women's wear which has been really an amazing.Growing up in Italy
Armani worked very hard to create his name as known to all. Giorgio Armani started working
in stores and steady jobs just like everybody else but he knew he had an idea and wanted
his idea to be recognized. At last 1975, Armani started over a business with Giorgio Armani
Junior, Underwear, Swimwear, Accessories and Occhiali. Overtime he made contact and
agreement with various companies like Gruppo FinanziarioTessile (Textile Finance Group),
Luxottica Group, EMAAR Hotels & Resorts and so one to extend his business. In 1999, this
company came under e-commerce business in USA. At present Armani has 5000 staff, 13
factories, 500 exclusive retailer in 46 countries worldwide. Armani worked hard that put his
position of todays. It is thought that Armani is the most valuable fashion designer’s in the
present time. It is happening because of his dream. He works now seven labels that had
been noted below familiar to all over the world. The sort time object of this company is
earning profit but long time object is welfare of mankind so that it raised the Global Fund in
the fight against AIDS in Africa in 2006 (Steward, 2012). According to Yahoo Finance (2015)
it is a private company from beginning but has licence agreement with various company or
business group.
Alexion Pharmaceuticals is a biopharmaceutical company that are engaged in the
innovation, development, and commercialization of life-transforming therapeutic products for
treating patients. The basic different between Armani and Alexion Pharmaceuticals is noted
below.
Alexion Pharmaceuticals is Medicine Company having global fame whereas Armani is a
| Page

brand company deals with luxurious product. The main consumer of Alexion is patient but
Armani is fashionable man. Alexion is related with basic human need on the other hand
Armani is subsidiary need. The ownership of Alexion is Public but Armani hosted with Private
Company keeping ownership Giorgio Armani. The brand value of Alexion is 30.73 Billion
Dollar whereas brand value of Armani is 3.1 Billion Dollar (Forbes, 2015).

1.2 Identify the key stakeholders of Armani.
As Armani is a private company Founder Giorgio Armani who is the only one owner of
Armani Brand. Researcher does not seek on Armani’s profit estimations, there is absent of
insane board of directors who doesn’t consider reality while they are collecting retainers and
there is no employees scramble over each other’s' backs, being optimistic that stock
decision will be top before stock market. Without public offering, financial bodies and
profound capacity Armani hosted only product. By eradicating the surplus, emphasising
reliefs and recognising sophistication of easiness, Armani brand has been exposed as style
for women as well as for men. Armani’s elegant, non-centralised coats for profession
females changed the rigid that is entitled as dress for success suits that imitation what
manufacturers naturally dress in. Beautiful fabrics were presented by Armani and also
indirect tailoring, ensuing his brilliances rather than a rigid fashion formula (GUGGENHEIM,
2000).

Business objectives are the ends that an organisation sets out to achieve. The objectives
and plans of an organisation create and determine by stakeholders in the organisation. As
Armani is a private business so the work of stakeholder done by one person. An
Organisations create a hierarchy of objectives like as market share, customer satisfaction,
employee satisfaction, cutting pollution, reducing waste and so on (Business Case Studies,
2004).

1.3 Strategies it adapts to meet their needs and expectations.

Stakeholder

Stakeholder Interests

Assessment
Impact

| Page
Fig: Stakeholder Analysis

of

Potential Strategies

x

y

Stander stakeholder analysis matrices have to display each person interest to change,
where interests meeting, the smooth of influence, and person who have a steps in the new
improvements. Stakeholder analysis matrices can be favourable at the outset of new
projects. There are some great cases of stakeholder analysis matrices out there. Each part
of the same four of the boxes as a band altering of a distinct request, this won’t be difficult
when Armani should control with the person to contact first: person number one having high
impact and position or another once having high stimulus and importance. If possible it is
helpful to compute objectives. It needs being perplexing. It is difficult to achieve goals or
objectives. It would be achievable and that should not be vague. It also have to be easy
making out that can be too easy to communicate. By setting up goals, market chain of
Armani shear has been intensified 20 percent to 80 percent in three years. Armani adopted
numerous ways to create his complete noted. In 1980’s there was unforeseen amendment in
apparel industry. The demand for modern product was high. And this was the time once this
complete came into existence with numerous sorts of merchandise. Armani used the
acknowledged personalities or super stars and model to market his product. He created
promotional schemes offers to induce his merchandise renowned. Armani conjointly
organized campaigns to market his merchandise and build it renowned in people’s eyes
(Business Case Studies, 2004).

Task 2
2.1 Advantages and Disadvantages that organisations would handle in a
dissimilar economic system.
A free economic system known as capitalism, is an economic system where a person has
the freedom to build business and conduct economic activity with little or no government
interference. Command economy system knows as Socialism or Communism, is an
economic system where government control over all major parts and economic production.
Armani started business in free market economic system and the potential buyers of that
| Page

good or service determinate the price. The value of product is depending upon market
supply and demand. But in command economy value is determinate by government. In free
economy system the owner is rewarded all the profit achieved in business but in command
economy the price and profit is public property because government is the responsible to
bear its citizen. Production is depending on owners willing but government definite mode of
production in command economy. One of the most important advantages of the free
economic system is the flexibility of the economy where is rigid to command economy. All
the character of free economics system found in Armani. The Production level, profit,
economic supply and Flexibility depend on owner Giorgio Armani. At the starting Armani
deals with few product but at now their service and area of business so gigantic (Synonym,
2010).
Political environment influence Armani very much. Political environment includes philosophy
of political parties, ideology of government or party in power, nature & extent and so on.
Government interfaces are the Government legislations, laws, regulations and restrictions on
trade. Population is the important in business reforming. Armani is fashion brand where main
customer of their product is the modern people. The trading partner of Armani are Textile
Finance Group, VestimentaSpA, Deanna S.p.A, EMAAR Hotels & Resorts LLC and so on
(Slideshare, 2013).

2.2 Impact of fiscal and monetary policy.
Metcalf (2013) defines that Aggregate demand can be noted as total production of goods or
services in given certain time. Fiscal policy is the way by which a government regulates
own spending levels and tax charges to observer and effect a nation's economy. These
effects impose on commercial division in two stages. The First level is legislation related with
overall economy and the second level is targeted legislation related with definite segments of
a business. To accumulating the economy, Govt. might authorised act that bring money from
everyone’s' pockets to government pocket. Government expenditure programs directly
influenced to a business that profited gained or impact on government greatness. In this way
we can say that for this development of government, the business become beneficial. This
development is like build rail way, high way, Power plant and so on.
Monetary Policy is the system to control over money for inflation from market by increasing
bank rate. The central bank has obligation to control over the money supply for checking
inflation and financial issues. The primary effect is increasing interest rate after cost of
money. The subsequent result of that money supply become broad than before, large
number of investment occurring in domestic economy. On the other hand to control over
| Page

money, government increase the interest rate (Metcalf, 2013).
AD = C + I + G + (X-M) in where C is consumption (we called it, Customer expenditure) = a c
+ bc(Y - T), Y consider as income and T noted as taxes, I listed Investment, G means
Government spending, NX = X - M exposed Net export, X for total exports, and M means
import = am + bm(Y - T). If the level of income tax is fallen then Armani T is decrease means
consuming tax for that the sell become increased means C increased. If the value of pound
increases then the rate of goods and services become lower. If the time of falling interest
rates the rate of goods and services become higher. On the time of large increasing in the
level of Government expenditure, government increase their tax rate then Armani gain low
profit and C become lower.

2.3 Impact of Govt. rules including competition policy.
According to Competition Policy International (2007) Most of the business in the world have
negative impression on government systems and their unhelpful behaviour. In the cite note
we can mention the small business that has tiny time and strength, government legislative
necessities have alleged, besides shifted and disorder situation happening during 20 century
because of imposing illogical income tax and non-tolerable laws were first build.
Competition Law in Italy is set out in 1990 that controls preventive performs, misuses of
leading places and applications, in a manner noticeably duplicate to the European rules.
Restrictive practices mentioned on Article 2 related to the exclusion of contracts,
determined performs and judgments of suggestions activities, that is the goal of avoiding.
Abuses of dominant position suggest on Article 3 related to the law of forbids abusive
comportment from the portion of domestic, more than one endeavours in an important
position and offer dissimilarities. The concept of the Italian law focus on Articles 5, 6, 16, 17,
18, and 19 of the Law. These make a concentration that is noted as when i) more than
include the marge; ii) who is in undertaking also undertaking for all; or iii) More than twos
works as Joint company of business. Armani follows all the regulation of government. The
few act of that is tough to any business organization that also for Armani. They do not have
any record of breaking the government regulation. Though the time of lunching was different
but they adopt the regulation (Investopedia, 2011).

| Page

Task 3
3.1 Market structures based on the Price and Output.
Market structure is a concept by which formats with the combination of buyers and sellers.
The Price of a goods and services depend upon the access and number of buyer and seller
presenting. In a market we found few types of structures like


Perfect Competition,
Monopoly:
Oligopoly.

Perfect Competition is a market structure where are existed more than one sellers who
contain same product then the price of the production depend on the existence of another
business. In this market buyer essentially define the price of product & the business takes
the decisions comparing with other predictor because every company bear a tendency to
offer low price to their customer and increase their market shear (UK Essays, 2013).
Monopoly structure formed various business into one business where control themselves
price to their customer. The customer has to pay the price of the product, but not choose
willingly. Besides Firm produces with full effort because they will be bound to fulfil the
demand as a whole for their products (UK Essays, 2013).
Oligopoly market structure formed various seller with same production where sellers in the
component to define the price. Large sellers make themselves as a unit where customer has
no option and buyer are compel. Seller has change the price and the promotion of goods are
not frequently happening, in oligopolistic market organisations take verdict of output in the
light of the request from their consumers towards their goods(UK Essays, 2013).

3.2 Focusing market forces shape organizational responses using examples.
Market forces is making confided that define a price of a product in economy. It is the
combination of Demand, Supply, Employees, Customers and Suppliers. A business is bound
to provide priority with demand that is vacillating of products like increase and decrease. In
the time of increase demand the business situation become enrich with a lot of staff engaged
with production. On the other hand, decreasing demand the production become so low and
bring a little profit. An organization respond negatively to their workers (UK Essays, 2013).
Like the demand supply is related with two things in production. In the time of high demand
the supply would be less whereas low demand of a production the supply is raising and the
products need becomes lower. A business response on this crucial moment to intensify the
| Page

supply and remove supply shortage.
Employee may be consider as blood of an organization who can change the organization
with the behaviour. Had the government announced not to provide minimum salary, the
worker joins another company by leaving present job.
Every organization has tendency to make satisfied their consumers through producing
goods. If any organization produce their fashionable product without considering the time
situation with the teat of their customer, then they loss a large amount of customer who is in
believe in present fashion or modern one. The cause behind that is customer can’t meet
their requirement. As Armani is a fashionable brand, it has regular customer connection.
They provide customer support whole day long with 24/7 support (UK Essays, 2013).
Every organization is much more relies on supplier and also called that the supply is the first
step of gaining profit and without it production is impossible. The relation between supply
and raw materials is positive. If the prices of an organization are elastic, the raw materials
also would elastic price. If the product price is rigid and varying, there is no change of
demand that’s why product would be cheap and demand would be change.

3.3 Business and Cultural Situations form the character.
In Business and Cultural Environments, there are few shapes that are important to adopt the
business. Those feature mention below:
Political: This alludes to the administrative arrangement like as government interruption in
what administrations and products to create, which firm to support and so forth. Ethical
judgments additionally have an impact on business exercises, for example, wellbeing and
training for works and the framework of the economy. Armani is a well-known brand of
Italian. It has more than 5000 direct staffs. They take after Italian business regulation built-in
1990. They bolster their staff with world class standard. All the new law and regulations by
the administration influence Armani.
Economic: Economic elements may be noticed the financial conditions overall. These
elements incorporate swelling, the rate of interest, trade and monetary advancement and so
on. Armani started business and spade all over the EU, USA and other countries. Day to day
the economic activities increase and popularity. Their sale also increases much more and
they guess that sales of the company were around $1.69 in the end of 2005. Many people
engage with employment in Armani. Armani have to be conscious of all such conditions
being organised to accomplish them well.
Social: It means the cumulative of human being consist of different family. That may be
| Page

included changing pattern of taste, changing level of income, modification of style etc. Every
single concept have the power of shifting demand for the product. These are normally
occurred with Luxurious and style merchandises. Armani surf their product according to
customer want and choice. The test of choice China and USE are not same. By thinking that
they arrange fashionable product to those criteria base outlet. It is the example of social
services.
Technical: This means a modification and improvement in the way of production with the
help of technology that improved the feature of products, increase in productivity etc. Armani
apply technology the way of production. They use different up to date the way of production.
They also lunch online shopping system and automatic price tag and so on.
Legal: It means government makes new law to run the business on the specific time
interval. Government licenses distinctive fresh rules after every positive time retro which
rises expense of the organizations. Such acts may incorporate age separation, development
in the lowest pay permitted by law and so forth. In 1990 the new business law create and it is
continued today.
Environmental: It is the important factor of a business. Various business in the world based
on thus factor. The production of specific goods, supply, and demand and so on depend on
it. Tourism business, agricultural production and like that are mostly depend on the
environment.
Cultural: Attitude, behaviour and the knowledge are the cultural production. We found two
types of culture. Internal culture may be include normal culture what we are and external
culture is the culture of business oriented. Armani has both of the cultural features.

Task 4
4.1 Importance of International Trade and Globalisation.
According to Economy Watch (2010) International trade has prospered over the year’s
cause of the numerous advantages it has offered to distinctive nations over the globe. Global
exchange is the framework where trade of administrations, creation and capital inside
different nations and locales, without much interference. The universal exchange accounts
consider as domestic product. It is also one of significant sources of revenue for a
developing country. All of this happening with the assistance of advanced generation
methods, propelled transportation facilities, international partnerships, outsourcing of
assembling and administrations. The compensations of universal exchange have been the
primary drivers of development for the last 50% of the 20th century. Worldwide exchange
| Page

like Armani has gotten to be thriving and has the ability to controller the world economy. The
overall exchange can turn into one of the boss suppliers to the decrease of neediness.
Armani conduct their business globally. Armani extend its brand to USA, UK, EU, Russia,
China and Japan. That is the example of International trade and globalization. It becomes
more beneficial. Some important benefits that have get Armani noted below:








Increases the national competitiveness.
Receives benefit of worldwide employment technology.
Rise the size of deals and revenues.
Spread sales capacity.
Control cost compere in domestic market.
Improve capacity developing business.
Achievements of an international marketplace share.
Decrease dependency.
Alleviate periodic market.

4.2 The role of World Trade Organisation (WTO) emerging markets BRIC
countries.
The BRICS stands for India, Brazil, South Africa and China. The members make
commitment within a few topics in the meeting that includes: planning a methodical method
responding at every promote economic declines international economy, foundation
budgetary participation, working with multilateral strategies, verify practical improvement,
coming back to the basic difficulties of urbanization and nourishment qualities, and coworking for acknowledgment of social insurance and solutions among others. Requirement
for building economical organizations together for multilateral exchange gatherings at WTO;
create option wellsprings of innovation; build business-to-business contacts and upgrade
vitality security and so on. The BRIC countries work together for development of their own
economy. They believe themselves as a product life cycle processor that China is known as
domestic production, whereas India known as the place of services, and raw materials
sector enriched in Russia and Brazil (Metcalf, 2013).
By working all in one they can be more effective than the west in the structure. But in real
sense the relation between USA, the EU and consensually are further significant, but doing
substance we can watch the development between BRIC nations to notice if they work
together collaboration. This superior essential depending on the international dealing system
rises consequent of new settlement of centres of financial standing in the world. The
fundamental test we confront today is the way to perform the modification from the present
period that affiliations these monstrous varieties in the global scene to a period that will bring
better synergistic and supportive business implies over various countries. This will oblige a
| Page

multilateral exchanging framework. The impact on economy, education, employment,
competition exists in the market. Armani already run their business to those BRIC countries.
By Following the rules and regulation created by WTO, they extend their business also
another developing country.

4.3 Impact of policies of the European Union on UK business organisations.
The term policy may be noted as the system where makes a decision and the initiative to
make it successfully. It works as a process. Policy is support the capability within European
Union on UK business organization in there action is laudable and have an expectation to
seniors. Policy instruct the getting the success and achieve the aims (Clark, 2009). It also
help to gain special decision and support to senior to conclude the activities. In policy,
objective are operated. The influence of policies of EU especially to UK organization are in
listed –
The impacts of strategies are secured to stay away from destructive conduct that gets
positive advantages the UK business association. Business getting arrangements help
associations to surrender negative impacts. Organizations have approaches that actualized
through gaining methodology. The UK business made an impact to enhanced possession
through arrangement. Arrangements meddle the situations that strategies seek after to effect
on governments, humanities, substantial business is to rolling out an approach
improvement. Government is the producer of arrangement choice to expand charges from
business. The strategy making method contains a test to evaluate approach impact that
arrangement is shocking punishments (Welford & Gouldson, 2003).

Conclusion
In conclusion we can say that business environment discusses for the UK government and
the plan of moderate. It is the way of success in promoting from current situation to develop
one. Business environment is the most important factor in the time of forming business to
manage. The advancement of social obligation is adding to making business development. It
is fundamental for prosperity to centre of political consideration.

| Page

Reference(s)
Business Case Studies (2004). Business objectives, planning and stakeholders. [ONLINE]
Available at: http://businesscasestudies.co.uk/business-theory/strategy/business-objectivesplanning-and-stakeholders.html#axzz3Uby63ENC. [Last Accessed 17 March 2015].
CPI (2007). Italy: Competition Law Regime and Policy, an Overview. [ONLINE] Available at:
https://www.competitionpolicyinternational.com/policy-an-overview. [Last Accessed 14 March
2015].
Economy Watch (2010). Benefits of International Trade. [ONLINE] Available at:
http://www.economywatch.com/international-trade/benefit.html. [Last Accessed 17 March
2015].
Forbes (2015). Company Profile: Giorgio Armani and Alexion Pharmaceuticals. [ONLINE]
Available at: http://www.forbes.com/companies/alexion-pharmaceuticals/. [Last Accessed 17
March 2015].
GUGGENHEIM

(2000).

Giorgio

Armani.

[ONLINE]

Available

at:

http://www.guggenheim.org/new-york/press-room/releases/press-release-archive/2000/698september-25-giorgio-armani. [Last Accessed 17 March 2015].
Investopedia (2011). Government Regulations: Do They Help Businesses. [ONLINE]
Available

at:

http://www.investopedia.com/articles/economics/11/government-

regulations.asp. [Last Accessed 17 March 2015].
Metcalf,

P.

(2013).

Policy

to

Business.

[ONLINE]

Available

at:

http://smallbusiness.chron.com/policy-business-69568.html. [Last Accessed 16 March 2015].
Slideshare (2013). Internal and external business environment. [ONLINE] Available at:
http://www.slideshare.net/AbhyudayShah/internal-and-external-businessenvironment?
related=1. [Last Accessed 18 March 2015].
Steward, S. (2012). Brief history and mission statement. [ONLINE] Available at:
http://hautecoutureforever.blogspot.com/2012/08/brief-history-and-mission-statement.html.
[Last Accessed 18 March 2015].
Synonym

(2010).

The

Advantages

of

Free

Enterprise.

[ONLINE]

Available

at:

http://classroom.synonym.com/advantages-enterprise-2562.html. [Last Accessed 17 March
2015].
| Page

UK

Essays

(2013).

Businesses

Marketing.

[ONLINE]

Available

at:

http://www.ukessays.com/business/businesses-marketing-essay.php. [Last Accessed 11
March 2015].
Welford, R &Gouldson, A., (2003). Environmental Management and Business Strategy.
Yahoo Finance (2015). Company Profile: Giorgio Armani S.p.A. [ONLINE] Available at:
http://biz.yahoo.com/ic/54/54529.html. [Last Accessed 17 March 2015].

| Page