PRAGUE COLLEGE

Business Environment and Organization s Mission Statement
Business environment, Assignment 1
By Dmytro Pyrkh

2011

111

Table of contents
1.0 Introduction 2.0 Main body 2.1 Identify the mission, values and key objectives of an organization and assess the influence of stakeholders 2.2 Evaluate the extent to which an organisation achieves the objectives of three stakeholders 2.3 Explain the responsibilities of an organisation and strategies employees to meet them 2.4 Explain how economic system attempt to allocate and make effective use of resources 2.5 Discuss the impact of social welfare and industrial policy initiatives on organizations and the wider community 2.6 Evaluate the impact of macroeconomic policy measures and the influence of the global economy on the UK-based organizations and stakeholders 3.0 Conclusion 4.0 References

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Introduction
In this assignment I will identify and discuss the µmission and goal¶ of organization. I will show the key objectives of organization and the responsibilities of organizations. I will also show the example of organization¶s responsibility. Also I will add the analysis of the three components of business environment. This will include the analysis of Economic, Global and Social environment. In the end I will make conclusions about the organizations¶ tasks, goals and responsibilities and about the role of the environment of organizations.

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Main Body Identify the mission. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the values provide 4 . So we can say that the mission of the organisation is a set of principles the organisation should follow. investors. because when people are sharing beliefs the owner will know how they are working so that he /she can predict their actions. This mission of organization doesn¶t allow the organisation to work in the areas outside its started mission. the mission of the company is to become the major and the biggest company on the market with the best quality product in one year). Also it can give the opportunity to the owner of focusing his thoughts on the strategy of the company. instead of controlling the employees. which the organisation is planning to fulfill within society over the long term. The first and the main problem is that mission is sometimes stated only on the paper. So we can say that the mission statement of the organisation is the set of rules that organisation should follow in order to be successful. values and key objectives of an organization and assess the influence of stakeholders. The values of the company are the common beliefs of the all employees about how the company should work and what mission it has. stakeholders). in terms of the products and services it produces for its clients¶. but there are some problems connected with the mission.g. But it can also influence the planning process. All the plans of the organisation should follow the mission statement of the organisation. government. when in real life no one is following it. Another problem I should point out is the turning of wishes into the mission (e.g. The values identify the culture and structure of the company. The second big problem is that mission can be made by the organisation in order to rationalize the relationships with the certain audience (e. The mission of any organisation is the specific role. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) mission µdescribes the organization¶s basic function in society.

to maintain growth and development. to make profit. The corporate objectives are the objectives that are connected to be related to the whole organisation.you with the set of principles µthat govern the overall conduct of the organization¶s operations. Usually the three primary objectives that the organisation always has are: to continue in existence ± survive. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the corporate objectives are: Profitability Market share Growth Cash-flow Return on capital employed Sales 5 y y y y y y y y y y y y Customer satisfaction Quality Industrial relations Added value Earnings per share Risk . code of behavior. The objectives of the organisation can be divided with two characteristics: the first is the importance of the objective and the second is what the objective is related to. but if someone will not share the values of your company it can cause real problems. and according to the relativity the objectives can be corporate and unit. According to the importance the objectives can be divided into primary and secondary objectives. These are key objectives of any organisation that are relatively connected with each other. the aims to be achieved and the desired end result¶. The secondary objectives are made to bring the company to the point of reaching the primary objectives. Let¶s look at all the objectives separately: The primary objectives are the objectives that are used to be the main goal for the whole organisation. the management of people and its dealings with the other organisations. The problem you can meet that is connected with the values of the company is that the values give you the opportunity to reduce the control. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) Objectives of the organization µset out more specifically the goals of the organisation.

public sector (e.g. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) Stakeholders are µindividuals or groups who have an interest in how the enterprise performs because it affects them in some way¶. The problems you can have with the objectives are that the unreachable objectives can be set up. technology) unit objectives. increase the number of customers). There are: commercial (e.g.g. Traditionally the most important group of stakeholders are shareholders. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the list of stakeholder groups looks like it is shown below: Stakeholder groups Shareholders Lenders Intermediate (business) customers Final (consumer) customers Suppliers Employees Past employees Retires Competitors Neighbors The immediate community The national society Corporate management The chief executive The board of directors Government and local government Special interest groups 6 . employee development.y Brand loyalty The unit objectives are the objectives that are connected to the certain department of the organization. respond more quickly on calls) and general (e.

Every organization has three types of stakeholder groups in organization. customers. suppliers. They are: Internal stakeholders (employees. Many writers have stated that employees are the most important of all of the factors of production. management) Connected stakeholders (shareholders. pressure groups) y y y The internal stakeholders are the stakeholder groups that are mostly connected with the organization. These groups have different goals and type of influence on the company so let¶s speak about every group separately. The organization is a place where managers and employees spend a great part of their lives. customers and suppliers. Nowadays shareholders are being asked to be more involved in company¶s affairs. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) these factors are: Security of income Increase in income A safe and comfortable working environment A sense of community Interesting work Skills and career development A sense of doing something worthwhile y y y y y y y Another type of stakeholder groups is connected stakeholders. Shareholders/owners. They are mostly interested in the continued existence of the company. Some shareholders are concerned with the corporation¶s ethical performance. The main interest of this group is to get the return on their investments. bankers (or lenders). These stakeholders have their own individual interests and goals. financiers) External stakeholders (the community. They are: shareholders/owners. government. 7 .

This stakeholder group wants services and products. Suppliers. A big group of customers can have a great effect on the products produced. suggestions. If the company loses suppliers they will not be able to produce the product because they will not have components or materials. the quality of the products and if the development is needed.Bankers (lenders). The wants of suppliers are simple: to be paid in time and to have the cooperation with this company in the future. The customers can affect the companies with the help of feedbacks. This group of stakeholders is interested in the overall condition of the company in order to be secured that they will get the interest for every loan they give to this company. Banks can give money under different conditions and according to what it is the loan or a mortgage the banks are looking at the organizations¶ condition from different points. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) µexternal stakeholder groups ± the government. complains. For example for mortgages the bank is looking at the property the company has because the mortgages are secured by the real property. but when the bank is going to give a loan to the company they are more likely to look at the income of the company. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) its main laws include: 8 . Government. prices of these products. local authorities. filling out questionnaires and actually choosing to byu this product or not. the community at large. The last part of stakeholder groups is external stakeholders. pressure groups. Customers. This group of stake holders has a small amount of interests but the great impact on the workability of the company. The government of the state can have a great influence on business through creating new laws and regulations. professional bodies ± are likely to have quite diverse objectives and have a varying ability to ensure that the company meets them¶.

Employees. Let¶s take a look at the needs of these groups. Evaluate the extent to which an organisation achieves the objectives of three stakeholders. They are interested if the company and its members comply with professional ethics and standards. Employees have to be educated and be insured that they will get their salaries and that they will not lose their workplace without reasons.y y y y y Passing laws to protect workers and customers Collecting taxes Supporting business in socially or economically deprived areas Subsiding activities Aiding exporters Local authorities. Also employees have to have the opportunity of improving their skills and the opportunity of career growth. The needs of employees are shown in the Maslow¶s hierarchy of needs. Professional bodies. Pressure groups. For motivated employee it is enough 9 . Every pressure group has its own interest and its own opportunity to influence the company. This group of stakeholders is interested if the company can bring local employment or cause damage to the local environment. I decided to speak about these groups because these are the most important groups of stakeholders. Now as we can see the stakeholders have a great influence on the organization and their wants should be taken into the consideration of the company. We would like to speak about customers. employees and government. They have the biggest influence on the organization.

They can directly influence the work of the company and the costs it has by providing new laws and regulations. According to their wants and needs you set up the price of the product. 10 . The definition of what the customers want can be gathered with the help of questionnaires and respecting the complains from the customers. Government. The wants of this stakeholder group are to have a good product that suits their needs and wants. Government is also a very important stakeholder group.to reach the safety and security needs for every employee. Customers. The motivation can be reached with the help of providing good working environment and good attitude to the employees. This can be easily reached by producing the good quality product and respect their wants. its quality and the development of the product. This group of stakeholders has a great influence through the creating the demand on your product. Fig. 1 The education of employees can be reached with the help of organizing trainings for staff or sending them to the courses in order to improve their qualification.

It is easily reachable goal and this is a required part of the existence of the organisation. Also they can be caused by the responsibility in front of the society. Local government is expected to provide or improve the services for the local community. There are some examples of social responsibility by different types of organisations. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) there are five types of responsibilities of organization. The interest of this group is that the organisation should respect all the legal regulations. y y Universities and schools are expected to produce students whose abilities and qualifications will prove beneficial to society. Even organizations like governmental schools and hospitals exist because health care and education are seen to be desirable social objectives by government at large. Social responsibility is expected from all types of the organisations. They are: Social responsibility Environment responsibility Management responsibility y y y Social responsibility According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) social responsibility of an organisation may be defined as the obligations that the organization has towards the people and the environment in which the organization operates. Every organization has certain responsibilities.Also this is the group that can stop the work of the company. Explain the responsibilities of an organisation and strategies employees to meet them. 11 . but at the acceptable cost to the council tax and business rate payers. These responsibilities are different and related to different organisations.

third are green concerns and forth are the aspects that relevant to business. These regulations are regularly updated and companies are responsible for respecting the laws. it can be prohibited to get the natural resources as coal in the places that are interesting for science or history. Environmental responsibility Environmental responsibilities of the company are defined by several issues. Legal regulations and legislation.y Pollution control is a particular example of social responsibility by the industrial company. First is the legal regulations and legislation. Green concerns.g. especially nowadays when a lot of people are really concerned about the environmental protection. Let¶s take a look at each sector separately. Direct impacts: Can affect the costs or availability of resources.g. Can lead to the additional costs for some companies and this will put them into the disadvantage in front of the competitors. y Affect power balances between competitors in a market. Indirect impact may manifest themselves in. 12 . Ecological issues. This is the laws and acts that the government has according to the rate of pollution your factory can cause. E. y y Can affect customer demand. pressure from customers or stuff as a consequence of concern over ecological problem. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) ecological issues can have direct and indirect impact on the organization. Green concerns have different relation to the different sectors of industry. E. second are ecological issues.

The secondary sector In the secondary sector of economy building and constructions are relevant.The primary sector Many industries in the primary economical sector such as mining or extraction of oil are directly connected with the physical environment. They are under the constant control with regard to environmental legislation. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) concerns here relate to the following: Deforestation Threats to wild creatures Replacing a natural habitat containing a diversity of species with a monoculture where only one strain is bred y y y y y y Pollution Health and safety of produce Poor working conditions and wages. Consumer goods According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) manufacturers here may be seen as: Damaging the environment or social institutions to meet consumer demand Producing µdirty¶ products 13 y y . and creating alternatives to the materials that are being used up. Green policies here would aim to promote efficient and effective use of resources and recycling where appropriate. There can be opposition of building new roads and houses in the wild nature or in places that can be historically important.

According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) green issues are becoming more significant for the following reasons: Small companies may be able to develop products for green µniches¶ more effectively than large enterprises. and can take advantage of flexibility to create green processes and systems. They still face the same decisions in their choice of suppliers. deciding which product will actually reach the customer.y y Using µdirty¶ processes Using up scarce raw materials. The enterprise acts as a µfilter¶. Small businesses Small businesses consume less raw materials and produce less waste so they face a different scale of environmental challenge. The tertiary sector The tertiary sector is divided into two groups: retailing and service industry. but they still consume goods and produce waste. Each group has its responsibilities so let¶s take a look at each group separately. their investment and their contribution to the welfare of staff and customers. y 14 . Retailing According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) in retailing the green customer is dealing with the enterprise. Service providers According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) service providers have less environmental impact comparing with other businesses.

animal and marine spices. Genetic diversity Genetic diversity is relevant to pharmaceutical firms. energy availability. Nowadays the opposition to genetically modified products is growing because uncertainties about the long-term effect on people and animals. trees. The modified types of plants and animals can cause damage to the wild species.y Many small businesses are using traditional methods of manufacture. water. which are often greener than more modern processes. Genetic diversity Pollution concerns Acid rain Ozone depletion Waste Climatic changes Energy resources y y y y y y y y Resource depletion Resource depletion may influence business operations through impacts on the availability of raw materials through damage to soil. Aspects which are relevant to business According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) ecological aspects that are likely to be seen as relevant to business are: Resource depletion. firms in biotechnology and the agriculture and food industries. 15 . using less energy and fewer non-renewable resources. Demand for such products is increasing. mineral welth. plant-life.

Pollution concerns Pollution concerns are at the center of most worries about the environment. The industries that can cause the such effect are under constant pressure from the political power of different countries all over the world because this affects the whole world. Ozone depletion This is a big problem that causes a lot of damages to the environment. y Noise pollution is getting more and more important and it can have a great impact on any type of business. The fact that a lot of scientists are saying that the global warming is starting because of the air pollution there were a lot of discussions about how to reduce it. Alternatives to CFCs have been developed and many other things done (such as new legal regulations) to prevent the further depletion of the ozone layer. y Concerns about the pollution of land. y y The quality of the air is plays a big role today. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) there are several main parts of pollution concerns. It causes problems with water supply and health of fish. 16 . Acid rain Acid rain is linked to damage to forest of the Northern Europe and acidification of water. the seas and oceans. through landfill policies and the long-term damage wrought by industry upon the land it occupies. The businesses are pressured to curtail the impact of their activities on the water table.

industrial waste and domestic waste. The handling of waste is becoming the target of legislation by national governments. Because of the pollution the unnatural weather is being fixed in many parts of the world. Also it has to be extended 17 . It is called The Kyoto Treaty. Energy resources The concern about the energy resources and environmental impact of its usage are related to the concern about the climatic changes.Waste There are different types of waste like nuclear waste. suppliers. Climatic changes Nowadays climatic changes are constantly occurring in our everyday life. Therefore energy saving programs are being made. Management responsibilities The stakeholder view is that management is responsible not only to shareholders but also to employees. competitors and to the community. customers. For example coal is giving only 40% of its potential into electricity. A lot of international agreements are made to reduce the pollution and especially the emission of gases that cause µgreenhouse effect¶. Another thing is that some resources are not giving full energy when they are used. A lot of new laws and regulations were invented to decrease the amount of waste. Let¶s look at the responsibility to each group separately. and good training and development schemes. Responsibilities to employees According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) general principles of responsibility towards employees should take the form of good pay and working conditions. The main agreement is still the agreement that occurred in 1997 in Kyoto.

and dealing honesty and fairly with the customers. Another problem of the retired people is that they don¶t know how to spend a free time that they got. to arrange µjob fairs¶. Responsibilities to suppliers According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the responsibilities to suppliers are usually expressed in the terms of trading relationship. Even for organizations that show an ethical sense or responsibilities towards their employees there are some situations when the jobs have to be lost. 18 y y y y . and redundancy and retirement policies. to provide good redundancy payment. In this case the organization can provide people who are about to retire with the special courses that would help them to plan their future time. The staff that is about to retire should be provided with the good pension scheme. Dealing with redundancies is a bigger and more complicated problem. Recruitment of new staff should be done very carefully because if an individual that is recruited by the organisation turns to be a bad worker it will be very difficult to fire a person. For that people who are made redundant the organization should make free trainings of skills that can be useful for a person in another organization.into: recruitment policy. Responsibilities to customers According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the ethical responsibility to the customers are mainly those of providing a product or service of a quality that customers expect. In this cases the organization should try to redeploy as many staff as possible and give them retraining to gain new skills so that these people could work at the other positions. Big organizations should not use their power to influence the supplies To pay the agreed amount of money in time All information obtained from suppliers and potential suppliers should be confidential All suppliers should be fairly treated.

this will depend on what consumers want to buy. but also a great deal of laws surrounding the fair trading. and what they will pay for each product or service. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) it should be responsible for: Upholding the social and ethical values of community Contributing towards the well-being of the community Responding to complaints of local residents and politicians y y y Explain how economic system attempt to allocate and make effective use of resources To make a right decision in allocation of resources there are three main factors you have to mention when you are making a decision. What goods and services will be produced? According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) µin the market economy. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) they are: What goods and services will be produces How will these goods and services be produces Who will be the customer y y y Let¶s take a look at each factor separately.Responsibilities to competitors The responsibilities towards competitors are mainly ethical.¶ The decision should be made with the including of the demand and 19 . monopolies etc. Responsibilities to the community In fact the organization is also a part of the community that it serves.

command economy and mixed economy. Also you have to choose who your supplier will be. 20 . The next choice about who will produce the goods and services and what mix of resources you need will depend on the µcost of resources and the efficient of its utilization¶.supply of the product. In fact the investment into education or machinery can bring a lot of profit but only in case if there will be the same demand. Who will be the customer? According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) there must be a mechanism of choosing who will get the product. Different economic systems Also I would like to speak about different economic systems. Also some products and services are provided by the government. The fact is that in the end you have to make a decision about what people will want in the future: if they want food or machinery. You have a variety of choices beginning with the small businesses and up to the government itself. How will these goods and services be produced? According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) after making a first decision you have to go on and choose the µappropriate and efficient production methods and technology¶. The actual demand on the product is called consumption and the supply of the product that exists in the market is called production. Different countries have different systems with their own ways of dealing with various questions. The main problem of the distribution is that there are different social layers and different types of consumers. But now I would like to keep my attention on the three main types: free market economy. By the end you have to choose what to invest in.

what to buy. The price will eventually reach the point at which all the excess supply will bought up. Consumers seek the greatest benefits for least cost.¶ The market economy is based on the ideology that the customer choice will influence market forces to ensure the optimum allocation of resources and there is no need for government to influence this process. prices will fluctuate. The only role of the government is to ensure that the ³invisible hand´ is free to operate.¶ 21 . If there is an excess of supply than the price of the good will fall. e. According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) µthe assumptions of a free market system include the following: Firms seek to maximize profits. who to sell. Prices will also rise if the demand is growing and fall if the goods become unpopular. As the price falls consumers will get more benefits for less costs and thus demand more. There is very little government intervention in business decisionmaking. Firms are free to choose what to produce. But they will always tend towards the µequilibrium price¶ where the amount consumers want to buy equals the amount producers wish to sell. Supply and demand and the ability to pay influence decision-making. y Because of the interaction of supply and demand. In this type of economy the most decisions are taken through the operation of the mechanism. where to work. Individuals are free to make their own decisions.Free market economy According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) free market economy ± µsometimes called capitalism. y y y y y y y The µPrice Mechanism¶ decides prices in the free market.g. Workers seek to maximize their wage relative to the cost of working.

According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) µthe state plans at three levels: Macroeconomic level Microeconomic level The distribution of output between consumers¶ y y y According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) the main fallings of command economies include: µLack of investment 22 y . In the today¶s world there are two countries that are still using the command economy.¶ In this type of economy the government decides what to produce and how much of it to produce. According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) they are: µThere is an unwillingness on the part of consumers to pay for µmerit goods¶ or µpublic goods¶ y y y y y y The public goods are most likely will not be produced in the free market economy Willingness on the part of consumers to pay for µdemerit goods¶ Inequality of power in the market place Barriers restricting entry to the market place and the immobility of factors of production Producers may ignore µexternalities¶ The planned (command) economy According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) the command economy ± µsometimes referred as state controlled. usually by central planning committees. But there are some problems with the market economy. In this type of economy decisions are taken collectively. These are Cuba and North Korea.These all gives the opportunity for the companies to have the free competition.

23 . According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) the µthree main types of intervention are: Provision or prohibition ± public goods are provided at zero prices to maximize consumption and increase social benefit. by the state. y y Subsidy or taxation ± merit goods are encouraged by subsidies to increase their consumption. externalities that are good may be subsidized.y y y No incentive to productivity Wastage of resources Black markets¶ Mixed economy According to µBPP Learning Media Ltd Business Essential: Business Environment¶ (2010) the missed economy is µone that combines elements of both private enterprise. in varying guises. where individuals have the freedom to set up in business in their own right and personally enterprise and intervention.¶ In the mixed economy the government has two main strategies to pursue ± replacing the market or augmenting the market. Alternatively some products are meant to be so harmful for the person and for society so that it is prohibited. Externalities that are bad can be taxed or banned. y Regulations ± price and quantity controls can be used to change production and consumption patterns. different motives and different impact on organization. I would like to look and discuss the impact of each policy separately. Discuss the impact of social welfare and industrial policy initiatives on organizations and the wider community Social welfare policy and industrial policy have different aspects. On the other hand the taxes on some products are so heavy that they reduce consumption and increase the social costs.

Also the government can also make difficult the entry of new firms. but firs I would like to speak about the impact of the industrial policy in general and then show it on the examples of the certain fields. There are several fields of industry where the government can have a greater influence. Also the government industrial policy can µeither hamper or promote the growth of new industries¶. Organizations that are working in this sphere have the biggest problems with changing the technology or the 24 .Industrial policy The industrial policy has a great impact on the functioning of the organization and the position of the product in the market. New products According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) government controls the adopting of new products in certain fields. y y y Now let¶s look at the different fields the government can strongly influence. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) it can be done in three main ways: By placing restriction to foreign firms By subsiding domestic firms that are already in the market By imposing product standards requiring a particular level of safety. y y The food industry is under the strict control of the government. Also µindicative planning¶ includes the identifying of so called bottlenecks ± the areas of industry that has problems with the supply of goods. Every country has its own standards. In pharmacy the government checks all the new drugs and medicines before the product goes to the market. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the government can have a great influence on the whole organisation by giving the assistance to the companies (usually to the companies that are used to be the winners in their industry).

Regional policy According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the industrial policy is complicated by the regional policy that is different for each region of the country. This can be done with the help of: Investment in physical and human capital Reduction in non-wage employment costs Support of small.and medium-sized enterprises Promotion of R&D and innovations Improvements to infrastructure Reinforcing the law on copyright and patents to encourage enterprises to develop new products. Sometimes the government can identify the structure of industry to be sure that the competition exists. The biggest debate today is about the safety of genetically modified product. In Ukraine for example there are twenty four regions and every region has its own additions to the industrial policy. y y y y y y 25 . Competition According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) µas a buyer. Industrial competitive policy According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) µthe new approach of the industrial policy is to focus on improving the factors that shape the nation¶s competitiveness¶.product mix that they are using for manufacturing. controller and supplier in the mixed economy the government can bring considerable pressure to bear on competition within an industry¶.

Selective benefits are reserved for people in need. In the first sense the social welfare policy is µpartly concerned with the social services and welfare state¶. Social welfare policy According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) µSocial Welfare Policy seeks to protect and directly improve people¶s standards of living¶. These are trainings for the employees and Skills Funding Agencies that provide the opportunity of getting new skills or improving skills outside of higher education. Today the welfare policy µbiases the role of the state towards promotion of equality of opportunity and the provision of services targeted on specific lower income or disadvantage groups¶. 26 . The social welfare has two senses.Training and skills policy You have a lot of opportunities to improve your skills at all levels. Social policy expenditure accounts around 50% .g. In the second sense it µstands to the range of issues far beyond the actions of government.60% of government spending and includes: Old age programs Unemployment Sickness/disability Social assistance/poverty alleviations Health/medical care Environmental policy y y y y y y Universality and selectivity The universal benefits are the benefits that are available for everyone and at any time (e. roads).

People are free to choose and pay for the private medical insurance. The contributory benefits are the benefits a person has paid for. The government built hospitals and provides free health services. y y y y y y y y Health and social protection According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the welfare state µseeks to provide citizens with benefits they would find it hard to purchase as individuals¶. These are: Retirement pension Incapacity benefit Maternity allowance Jobseekers¶ allowance y y y y The non-contributory benefits are: The Child Tax Credit and Working Tax Credit Housing benefit Council tax benefit Social fund Child benefit Attendance allowance Invalid care allowance Industrial injuries disablement benefit. 27 .Social security Social security includes Contributory benefits and non-contributory benefits.

education Foreign policy Trade promotion. incentives. sponsorship Regulation eg. Taxation Government policy Industry policy Impact on organization Protection v free trade Grants. capacity Environment and infrastructure policy Social policy Distribution Workplace regulation. employment law Labor supply. export credits EU and WTO obligations Export promotion to allies. These policies and their impact we will show lower with the help of the table. investor protection. skills. Government policy Overall economic policy Impact on organization Market demand Cost of finance. There are a lot of policies that have a great influence on the company. aid recipients 28 .Evaluate the impact of macroeconomic policy measures and the influence of the global economy on the UK-based organizations and stakeholders According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) government economic policy affects organization in many ways. company law Entry barriers.

They are fiscal policy and monetary policy. and there are very few people out of work ± just those between jobs. According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) they are: µ Economic growth is desired in order to provide employment for the national increase in the population and to improved living standards y y Full employment (that is. There are two main policies the government operates in order to influence the economical situation of the country.The government in the UK can influence the economy in three ways. for example) y Price stability (e. Fiscal policy According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) fiscal policy involves: Taxation and other sources of income Government spending Borrowing whenever spending exceeds income Replaying debts when income exceeds expenditure y y y y 29 . no inflation)¶ These aims often conflict to each other so it can be difficult to find a compromise. the economy¶s resources are fully employed. They are: Taxation and interest rate policies Public spending on goods and services Regulations y y y There are a lot of points the economic policy is trying to reach but the main three which are used to be the main ones.g.

According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) the monetary policy is using: A policy of low interest rate. Monetary policy gives you the opportunity to control the economy during the year. y y y y The aim of UK monetary policy is to control the inflation. y Strict credit controls. Leads to the reduce in spending and reduce of inflation rate because of it. You have to make a plan in order to establish what rate of taxation should be and which sector of economy (firms. without changing the budget. small business. This will stimulate the bank lending and increase the expenditure. This leads to the growing inflation y y High interest rates. Might be introduced to reduce lending and so reduce the demand in the economy. Monetary policy According to BPP Learning Media Ltd ¶Business Essential: Business Environment¶ (2010) monetary policy influences economic activity through: Interest rates Exchange rates Control of the money supply Controls over bank lending and credit. In the UK the policies adopted are showing the high and stable level of growth and employment. 30 .The fiscal policy is made to identify how much the government is going to spend and identify how much it needs to raise the income or by borrowing. big enterprises etc) the money should come from. The fiscal policy is usually established once a year.

31 . Also the economy is very stable. Social The social factors in the UK are very good. This gives you the opportunity to use the modern equipment. Social.uk/cci/nugget. This is a normal inflation rate which gives you the opportunity of growth.asp?id=19 the inflation rate of the UK in 2010 was 4%.statistics. Economical. Political The political point means the analysis of the influence of political parties in the country. Economical The economical factors of the UK are good for running a business.Alternatively the monetary policy might be given prominence over fiscal policy as the most effective approach by a government to achieving its main policy objectives. The PESTL analysis is the analysis of Political. These are the parties that have the biggest influence in the UK government and that can affect your organization. The government has a good social welfare policy and cares about people who are living in the country by providing the services that are needed. In my opinion the good thing to evaluate the impact of global economy is to make a PESTL analysis.gov. According to http://www. In the UK there are two main political parties: Labor party and Liberal Democrats. Technological and Legal position in the country. Technological The UK is a technologically advanced company.

All this factors have a great impact on organizations that already exist and on the organizations that are just starting their activity.Legal The legal regulations of the UK have recently changed. The government is strongly supporting English people with starting their businesses but it became much harder for the foreigners to set up a business in the UK. 32 .

Also we clearly identified the responsibilities of the organisation and the strategies that companies are using to meet them. Also we evaluated the impact of macroeconomic policy and the influence of the global economy on the organization.Conclusions To conclude we would like to say that in my opinion we clearly identified the mission. The impact of the social welfare and industrial policy on organizations was discussed. We had a clear explanation of the influence of economic system on the effective use of resources. values and key objectives of the organization. 33 . Also we cleared the influence of all the stakeholders of the organization and the interests that stakeholders have. In my opinion we also took three main stakeholders and showed their wants and how the organization can achieve them.

References 1.uk/cci/nugget.asp?id=19 (accessed on: 16.gov. Fig. Office for national statistics (2011).2011) 3.com/2009/12/17/day-101-±-self-actualization/ 34 .statistics. Available at: http://www.wordpress. BPP Learning Media Ltd.02. [Online]. 2. (2010). µBusiness Essential: Business Environment¶ London: BPP Learning Media Ltd.1 The Maslow¶s pyramid Available at: http://drvaleriegalante.

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