BUSINESS AND BUSINESS ENVIRONMENT

LO1, LO2

FOZIA
Contents
Introduction......................................................................................................................................2

Task 1; Organizations and Various Types.......................................................................................2

Task 2; Stakeholders and their role in Organization.......................................................................6

Task 3; Organizational Structure and connectivity to various functions of organizations..............8

Conclusion.....................................................................................................................................11

References......................................................................................................................................12
Introduction

The aim of this assignment was to provide learners with an understanding of different
organizations, the influence of stakeholders and the relationship between the businesses and the
local, national and global environments. We had to assume that we are working as a business
consultant attached to local government council in UK. From that we had to provide free
consultancy for local businesses. We can also identify business related environments by studying
this unit.

Task 1; Organizations and Various Types

What is an organization?

An organization is an arrangement of people, pursuing common goals, achieving results and

standards of performance. [ CITATION hol95 \l 1033 ]. . Fan, Wong,. and Zhang,. (2013) has
explained different types types of organizations. They separate them by their
 Legal form
 By the size of the organization
 Economic level/activity
 Sector (public and private)
 Voluntary or non-voluntary

1. Legal form – there are four types of organizations.

 Sole trader – sole trader is a single owned business, usually small in size and the
owner has the complete liability and also owner takes the profit and the loss.
Lawfully, it necessary is registering with government and paying nearly.
a minimum tax is essential for sole proprietor. Example More likely a self
employed business.

 Partnership – two or more persons owned the business and could be large in size
and partners have the complete liability like in the sole trader. Also share the
profit and the loss. A partnership occurs when two or more individuals exchange
 the company's earnings and damages. There are three types of partnership general,
limited and limited liability partnership(Bizfilings, 2016). Before going into a
partnership, it is appropriate to have an attorney draft a formal contract
explaining: the function of each member and the power level of the financial
contribution within each member, a resolving disputes process, a contract
termination or resignation method. (Smallbusiness, 2019).Example: Family
businesses, law firms, accounting companies.
1. A general association includes two or more company motive holders. General
partners deserve equal duties and responsibilities with regard to operations
management, and any person partner may bind the whole group to a moral duty.
2. A limited collaboration enables each member to reduce the quantity of their
company expenditure to their private liability. Not every partner can profit from
this restriction at least one participant must acknowledge the overall status of
collaboration, revealing himself or herself to complete private responsibility for
the loans and responsibilities of the company.
3. Limited Liability Partnerships (LLPs) maintain the collective association script's
tax benefits, but give the members some private limited liability. Individual
partners in a limited company are not responsible for other partners ' improper
behaviour or for the company's obligations or commitments(Bizfilings, 2016).

 Public limited companies – these companies are owned by the public and public
limited companies have large number of shares. Includes ‘PLC’ suffix at the end
of name. Owner has limited liabilities and also public limited companies are listed
in the stock market. Since restricted companies had their own legal standing, their
proprietors are not solely responsible for the loans of the company. The investors
have restricted financial burden, which is the significant benefit of the legal
framework of this sort of company. A government limited firm (PLC) is a
restricted liability corporation (LLC) which has provided shares to the general
population and has restricted responsibility. The share of a PLC is made available
to consumers and can be obtained by anyone, either individually, through an
 public offering or via the stock price exchanges (HARGRAVE, 2019).Examples
include Cargils PLC, Abans PLC.

public limited company should have complete legal paper working before
developing like  duplicate of PAN Card, individuality Proof ,Address Proof things,
title of owner evidence, and NOC. Moreover there should be approx 50 lack capital
with 7 shareholder and max 3 directors to create any organization.

 Private limited companies – privately owned companies and contain a small

number of shares and not listed in the stock market. Includes ‘LTD’ suffix at the
end of the name. Owners of these companies has limited liabilities. Since
restricted firms have their own legal relationship, their managers are not solely
responsible for the liabilities of the firm. Stockholders have restricted financial
burden, which is the significant benefit of this sort of legal business structure.
(BBC Bitesize, n.d.) Example: Micro Ltd Company
Continuous reporting and submitting of duties in each financial year
involves playing a limited company. Even when the business is not trading,
Companies House should file an Annual Come back. You could be sued if you
become late in filing or the business could be shut. (Rocket Lawyer, 2017)

2. According to the size of the organization it can divide into three groups.

The organization is divided into further 3 categories:

1. Small businesses – usually sole traders and partnerships would fall into this category.
Small businesses normally sell goods and services locally.
2. Medium-sized businesses – these kind of businesses operates in the national or
international level and it could sole trader, partnerships or limited liability companies.
i. Example: Insurance companies and Manufacturers.
3. A large company – sells goods and services internationally and operates in more than one
country. Tends to be a limited liability company.
Example: Car manufacturers (Toyota, Benz) , Oil companies (British Petroleum)
3. Three levels of economic activities.
 The primary sector – produce raw materials.
Example: Crops, Minerals
 The secondary sector – uses raw materials and processes them.
Example: Soft drinks, Rubber
 The tertiary sector – mainly the distributions and service industries.
Example: Banking, Tourism, Teaching.

4. Public sector and private sector companies.

 Public sector companies – Public companies are owned and controlled by the
government. These organizations are run for the benefit of the general public
Private-sector firms are non-government-run firms. They are component of the
economy of a state and are run by individuals and businesses with the aim of
earning the revenue.Example: Schools, Armed forces, Public libraries.
 Private sector companies – private sector companies are owned by the private
individuals or groups. Its main intension is to earn maximum profit. The private
sector is the component of an economic system run by people and businesses in a
nation, instead of the govt. Most organisations in the private sector are run as a
business.
Example: Schools, Private libraries.

5. Voluntary organizations - Non-profit driven, non-statutory, autonomous and run by

individuals who do not get paid for running the organization. Voluntary company is a
general term used to describe to a particular sort of organisation, sometimes related to as
non-profit organizations, NGOs (non-governmental organisations), non-governmental
organisations and human rights organisations. All of these terms represents a somewhat
distinct focus. The popular concept of a charitable organization, for instance, is "an
organisation whose objective is something other than to make a profit for its proprietors.
Its purpose is typically to provide facilities" (Anthony & Young 1990). Examples include
UNICEF, Save the children, Lions club.
Task 2; Stakeholders and their role in Organization.

Who are stakeholders?

Stakeholders are the individuals or the groups who have interest in how the enterprise performs.
There are three types’ stakeholders. (Keiningham,Perkins and Evan., 2003)

1. Internal stakeholders (Employees and Management)

2. Connected stakeholders (Shareholders, Banks, Customers, Suppliers)
3. External stakeholders (The government, Local authorities, Pressure groups, Community)

Distinction between small medium and large firms with size and scope

Not all organizations are working to create a gain. However, companies (or companies) that are
established with the main motive of revenue creation need not simply be large multinational
businesses with enormous staff. They may be tiny, micro, medium, or big. The differences
between these types of companies are the number of staff, the number of proprietors and
shareholder. Each company has to settle on its legal framework because it will have broad-
ranging consequences on how the company works, how it raises funds and what it distributes
earnings. A company can embrace many distinct sorts of legal systems, but the most popular for
SMEs are sole ownership, associations, and personal limited businesses(Martin, Muûls, de
Preux, and Wagner,2012)

Many others have been persuaded by the star buck company. Although the firm focused
on expanding its customers away from coffee to its product segment and food, fresh and exciting
goods such as replacing milk for soy milk or almond milk went out. Starbucks shops have
enhanced significantly. According to the investigate firm, the customer and business at Starbucks
stores has enhanced All of this helped extinguish some of the adverse feelings that had
developed around the business. By being the leader in product development, Starbucks has often
maintained its competitive edge. Recently, Pumpkin spice latte, one of Starbucks ' seasonal
favourites, has been reintroduced. (Starbucks, 2019) The shop network of Starbucks is much
lower than most QSR competitors such as KFC, McDonald's, and Subway. Correspondingly,
while altering its shop mix, the firm is working on extending its footprint.

Aim, goal and mission of small and medium-sized enterprises

Private restricted businesses are often tiny private firms whose liability is restricted by stocks
Since the company is small and private, the company is limited to a small number of
shareholders. In addition, the stocks cannot be traded publicly, meaning that private limited firms
cannot list their investments on the stock market. Many small and medium-sized enterprises
work under a private limited company status as it enables them to gain personal legal protection
and decrease personal risk while enabling them to raise money by selling stocks (Abiodun,.
2010).

The corporate stated mission of a corporation is an overview of whatever the firm is

doing for its destination clients. In Starbucks ' case of business analysis, the financial mission
relies on the company's philosophical intent. Just from the other hand, the corporate vision
statement of a company represents the business ' direction of the company as to what it wants to
accomplish in the long term. In this situation, the commercial vision of Starbucks focuses on
sector governance. The success of the business in reacting to its competitive setting relies on the
efficacy of these financial statements being implemented. This execution affects the generic
approach of Starbucks and the efficient strategy of development. Correlating strategic goals
allow the company to automate its activities to pursue the financial core mission and fulfill the
corporate vision proposal. (Koehn, 2002). 

The business continues to discover development through other drinks and products, such
as tea, beer, and wine. Starbucks also persisted to spend in its cafe existence by extending its
food choices, eatery renovating, and revamping its reward programs. This quarter, the firm
recorded profits of $6.3 billion, compared to $5.7 billion last year over the same era. Starbucks '
top person stockholders involve economic titans together with former chief staff and informant
managers (rego, 2018).
Task 3; Organizational Structure and connectivity to various functions of
organizations.

Every organization, whether organic or deliberate, has a hierarchy of individuals and

work functions. To operate effectively and systemically, a scheduled framework is needed that
matches the agency's theme, size and activities. Most organizations will need to perform 6 main
tasks to generate and sell their product or service. Design and development ,Financial services,
Research and innovation, Project management, Marketing and advertising , and Adminstration.
All of the tasks will have to work together to achieve the same goals and goals for the entire
organization. Key exercise is to accomplish this correspondence across the different tasks. A
place to start for this sort of contact is to establish a clear set of business goals that are known to
each feature.

These goals must then be any farther subdivided into particular goals for each feature.
Periodic assessments of initially how each feature performs against its goals or more over how
the business performs against its general goal should guarantee that the entire business pulls in
the same direction (Organisational Functions, 2019).

Responsibilities of Starbucks performing

Starbucks Entity is a leading roaster, distributor and retailer of quality coffee across the globe, an
American firm established in 1971 in Seattle, WA. Starbucks has about 182,000 staff operating
and authorized shops in 62 nations across 19,767 companies.

 Social responsibility of Starbucks is the obligation that the organization has towards the
people and the society.
 Organization is not only responsible for the owners but also for the stakeholders as well
by providing quality goods and services with additional benefits and dealing honestly and
reasonably with the customers.
 Public image is a public attitude towards the Starbucks in the mind of the general public
or potential customers.
 By having rules and regulations for the business you can have responsible organizations
towards the environment, public, society and to the stakeholders.
The operational structure and functions of Starbucks Corporation

Starbucks has an managerial matrix framework, which is a hybrid mix of distinct

characteristics from the fundamental framework kinds. In the whole case, the fundamental
structure includes junctions between different company parts The item-based divisions of the
company, for instance, overlap with functional groups and geographic lines that intersect with
some other components of the organisation. The primary characteristics of the company structure
of Starbucks Coffee are: operational hierarchy, geographic separation, item categories, squads

The operational Hierarchy of Function. The functional hierarchy characteristic of the

management structure of Starbucks Coffee relates to company function-based categories. For
obvious reasons, the business has a dept of HR, a unit of finance and a unit of marketing. Such
functions are most prominent at the upper levels of the corporate structure of Starbucks, such as
the office of the corporation(Martin,Muûls, Preux, and Wagner, 2012.).

The management structure of Starbucks Coffee includes geographic divisions, that are
focused on operations ' real place. For the worldwide sector, the firm has three global divisions:
(1) America, (2) China and Asia-Pacific, (3) Europe, Middle East and Africa. There is a senior
manager in each geographic sector. Each local director thus responds to at maximum two
supervisors: the geographic leader (e.g. European Leader, Middle East, and Africa Procedures)
as well as the functional leader (e.g. Big business HR Manager). This characteristic of the
company structure of Starbucks allows for greater managerial assistance for geographic
requirements.

In its management structure, Starbucks has item-based branches. These divisions are
concerned with product lines. (Meyer, 2019)For instance, the firm has a coffee and associated
products division, a further baked goods section, and another product section such as mugs. This
corporate framework characteristic allows Starbucks to concentrate on item advancement

Squads are being used in various components of the management structure of Starbucks
Coffee. At the smallest organisational levels, however, teams are most noticeable, especially at
the coffee bars. For illustration, the business has arranged teams for each café to supply
products , service and support. The business culture of Starbucks affects how appropriate teams
are accomplished. The growth of the firm relies on squad-based variables and related techniques
for managing human resources. (Meyer, 2019)

Organizational Structure of Starbucks

On 1 December 2016 a fresh Starbucks managerial system scheme was stated, whereby
Kevin Johnson, chairman and COO and chairman of the board of supervisors of Starbucks, could
expand his duties and move aside and duties of chairman and chief executive as of 3 April 2017.

Precisely, as demonstrated in provided Figure , consisting of 35 senior department heads

and 12 executive vice representatives, Starbucks is a extremely hierarchical management
structure. Kevin Johnson may try to decrease para-layering measures within the operational
system to make the coffee distributor more comfortable so that modifications in the globalized
economy can be adapted more quickly (Dudovskiy, 2018).
Conclusion

The understanding of the organizational environments of Starbucks, the influence of stakeholders

and the relationship between function and operations are really important. By going through this
report Starbucks has an managerial matrix framework, which is a hybrid mix of distinct
characteristics from the fundamental framework kinds. . Starbucks also persisted to spend in its
cafe existence by extending its food choices, eatery renovating, and revamping its reward
programs
References

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