Business Environment, Responsibilities of Organisations - Essay Example

BUSINESS ENVIRONMENT By Name Course Instructor Institution City/State Date Table of Contents BUSINESS ENVIRONMENT 1 Table of Contents 2 Section 1 3 1.1 Identification of the purposes of different types of organisation 3 1.2 Description of the extent to which an organisation meets the objectives of different stakeholders 4 1.3 Explanation of the responsibilities of an organisation and the strategies employed to meet them 5 2.1 Explanation of how economic systems attempt to allocate resources effectively 6 2.2 Assessment of the impact of fiscal and monetary policy on business organisations and their activities 6 2.3 Evaluation of the impact of competition policy and other regulatory mechanisms on the activities of a selected organisation 7 Section 3 8 3.1 Explanation of how market structures determine pricing and output decisions of businesses 8 3.2 Illustration of the way in which market forces shape organisational responses 9 3.3 Judgment on how business and cultural environments shape the behaviour of a selected organisation 10 Section 4 11 4.1 Discussion of the significance of international trade to UK business organizations 11 4.2Analysis of the impact of global factors on UK business organisations 12 4.3 Evaluation of the impact of the European Union policies on UK business organisations 13 5.0 References 13 Business Environment Section 1 1.1 Identification of the purposes of different types of organisation Business organisations: enterprises exist to serve buyers, and for that reason buyers (customers) are more essential than the employees, the management, or any stockholders. With no customers, undoubtedly there is no business; thus, the most important purpose of the business organization is to serve its customers to their satisfaction (Rodwell & Teo, 2004, p.321). Non-profit service organisations: these are organisation that permits entities to merge and join resources to accomplish common goals. In nearly all Countries non-profit organisations are given exceptional considerations bearing in mind that they purpose is to help the community free of charge. What’s more, non-profits may plan around a mutual purpose, like collection of stamp, or a collective objective, like the fluorocarbons’ eradication. Mutual-benefit organisations: they are also known as mutual societies, and frequently chosen as mutual. Notably, they subsist all over the world, in both developed and developing economies, on a relatively institutionalized form (Rodwell & Teo, 2004, p.319). Importantly, their purpose is to offer voluntary services such as insurance, aid, credit, benefits or other services a larger population or registered members. Commonweal organisations: commonweal is a volunteer-established aid organization which carries out programs that subscribe to ecosystem and human wellbeing. Their main purpose is to provide a secure world for humans as well as for all life by means of a program that concentrates mainly on environment and health, healing, Education, and justice (Abdullah & Rashid, 2012, p.72). 1.2 Description of the extent to which an organisation meets the objectives of different stakeholders According to Rodwell and Teo (2004, p.317) all stakeholders have distinct desires and objectives, which organisations must always meet. For instance, investors’ desire information that will assist them find out if they must purchase, hold or vend, so in this regard the organisation must meet the investors need by furnishing them with the needed information. This information can as well help investors examine the enterprise ability to pay dividends. Other stakeholders such as employees’ representative groups may require information concerning the profitability and stability of their managers, so the organisation must supply them with the information. This information can as well help the stakeholder analyse the capability of the organisation to offer employment opportunities and retirement along with remuneration benefits. Lenders are also stake holder in an organisation, and so organisation must furnish them with information that will facilitate them to establish whether their loans, along with the interest connected to such loans will be paid on time (Abdullah & Rashid, 2012, p.69). Besides, organisations should always supply information to suppliers as well as other creditors that will help them to find out whether the organisation will pay their debt on time. Customers on the other hand should always be given information concerning the enterprise continuance, particularly when they have a long-standing association with, or are reliant on, the organisation. Finally, other agencies such as governments must be furnished with information concerning resources allocation as well as activities carried out in the organisation. 1.3 Explanation of the responsibilities of an organisation and the strategies employed to meet them Basically, it is organisation’s responsibility to serve all and sundry. Besides, every organisation, enterprise, and department has a duty and responsibility to offer effective service. In order to offer effective service, organisation has to operate within the governing law and ethical principles. What’s more, trust and reputation are all, and a customer cannot have faith or trust in an organisation’s ability to deliver if the organisation itself cannot guarantee and verify their legality. In addition, an organisation should have unchangeable monetary management bearing in mind the fact that taking a risk is up to standard in business world, but poor budget mathematics is no tolerable. According to Pater and Lierop (2006, p.422) poor monetary control is more probable and can lead to organisation’s economic failure and shutting down. Furthermore employee recruitment is crucially imperative since organisation require dependable employees who have intelligence, and also passion for what they do. Additionally, the organisation must recruit workers who not only are innovative and creative, but as well can take critique and advice from their seniors. Pater and Lierop (2006, p.446) posit that poor recruitment can give rise to the lack of ability to build up a connection with potential consumers and clients. For this reason, Human Resources must establish what the workers anticipate of management bearing in mind that a triumphant labour force is a contented labour force, and vice versa. Section 2 2.1 Explanation of how economic systems attempt to allocate resources effectively Basically, there are various types of economies plus countries utilise distinct types of economies: the free market economy (used in UK), command economy, and the mixed economy. Producers and consumers equally take prices in a free market as a as a symbol. According to Shaoul (2005, p.452) when the prices of the products escalates than a different product on the customer behalf, then the procured products must be allocated by the purchaser. In a nutshell, all products must be cared for equally owing to their higher cost of purchase. Importantly, en enormous income opportunity is received by the manufacturers when the cost of certain products escalates. In UK, there is limited market intervention by the marker since it is a free market economy, which as a result, has led to wastage of market forces. In UK allocation of resources is carried out predominantly by the private sector, whereby the product’s price is set by the manufacturer or producer based on the product demand plus the government cannot put into effect limitations on the set prices. In UK, Shaoul (2005, p.457) posits that allocation of resources is carried out in accordance with the product demand. In brief, the UK Market has enhanced resourceful allocation of resources for the reason that prices are incessantly sporadic, signifying shortage as well as surplus base on the populace action. 2.2 Assessment of the impact of fiscal and monetary policy on business organisations and their activities The impact of fiscal and monetary policy according to Cuciniello (2005, p.921) is rooted in the country’s financial system which is being enforced by the country’s government. Basically, in fiscal policy funds are initially gathered by means of levy and afterward used on the country’s welfare and also development, whereas in monetary policy the funds are directly proportional to the demand as well as supply. Undoubtedly, the impact of both policies on any business organization is enormous. Cuciniello (2005, p.923) affirm that in fiscal policy it is the responsibility of the government to either changes the spending level or the taxation level. In this regard, if the government raises the taxation level then the population have little disposable revenue, and as a result, they will expend less. Consequently, the financial system spending will drop. On the other hand, increasing the taxes will as well have an effect on the manufactures given that when taxes are increased then the financial system spending falls, thus, the products demand falls and as a consequence the profits drops. Conversely if the levy is lowered and spending by the government is heightened, populace will have more cash, which as a result, will heighten the cumulative demand in the financial system so as to manage this increasing demand manufactures will have to enhance their operations by hiring more employees; thus, reducing unemployment rate. Monetary policies on their part generate an investment setting, which indicates that the monetary and legal setting should reward flourishing entrepreneurs and make sure they get a reasonable return on investment. Often this is achieved through fiscal stability promotion, which indicates that inflation.. 2.3 Evaluation of the impact of competition policy and other regulatory mechanisms on the activities of a selected organisation Competition policy as well as other regulatory mechanisms covers the various means wherein the government’s competition authorities as well as the European Union aspire to make markets function excellently and get an advanced fiscal efficiency. Basically, competition policy makes sure that there are scores of varieties for consumers. In competition policy Cuciniello (2005, p.926) posits that there is valuable cost competition between contractors. Competition policy intention is support healthy competition between organisations; ensures efficient operation of markets and adds value towards enhanced effectiveness in entity markets and improved UK organisations’ competitiveness. Furthermore, competition policy aspires to make sure customers have broad product varieties and promotes technological innovation which according to Cuciniello (2005, p.931) boosts dynamic effectiveness. European Union and UK’s competition policy are rooted in four fundamental pillars: Antitrust & cartels, which entails the eradication of agreements that aspire to limit competition. Market liberalisation: entails introducing of new competition in markets that were beforehand monopolistic. State aid control: analyse government aid measures to make sure that those measures do not alter competition. The final pillar is Single Market. Merger control: here take-overs and mergers between organisations are investigated extensively. Section 3 3.1 Explanation of how market structures determine pricing and output decisions of businesses Determination of price remains to one of the most significant facets in micro-economics: in this regard, employers should make ideal decision rooted in their judgment as well as knowledge. Because all financial activities in the market are calculated as per price, then Levis and Papageorgiou (2007, p.554) think that it is imperative to be acquainted with the theories as well as concepts connected to pricing. For profit-maximizing, Pricing and output decisions of businesses under conditions of monopolistic competition, perfect competition, as well as oligopoly differ in line with all market structures. Levis and Papageorgiou (2007, p.557) every organisation maximize its revenue at the output and price level where marginal cost (MC) is equal to marginal revenue (MR). However, under distinct market structures, businesses have different demand curves; thus, different profits structures. Conditional on the structure of the market, businesses that maximise their profits make distinct price and output decisions, which have distinct social consequences. Basically, in a market that is flawlessly competitive, businesses have no power to regulate prices for the reason that supplies have ideal substitutes, the number of buyers and sellers are extremely enormous, and businesses can effortlessly penetrate and walk out of the market. Rather, prices are established jointly by market demand and supply. 3.2 Illustration of the way in which market forces shape organisational responses Market forces have an effect on organisational responses in various ways plus it entails a number of things like demand, supply as well as marketing to customers. In this regard, supply is the quantity of services or goods accessible in the market while on the other hand demand is the amount of services or goods needed in a market. For instance, a new-fangled machine may be conveyed to the market, but the machine supply is higher than the demand. As a consequence, the demand and supply have an inverse connection.  Most organizations desire to arrive at equilibrium, a point where demand and supply are equivalent; undoubtedly, this is the perfect market point. According to Levis and Papageorgiou (2007, p.557) marketing is a goings-on that can plainly alter the supply and demand equilibrium point.  Furthermore, marketing can heighten the demand of service or goods, in so doing changing the equilibrium, and that is the point where demand as well as supply meets the desires of the customer.   3.3 Judgment on how business and cultural environments shape the behaviour of a selected organisation Subsequent to resourceful processes as well as structures, it is fundamental to concentrate on what the society experience, think and do around and in businesses. Employers must take into account how the organizational members’ behaviour acclimatizes and evolves plus how behaviour of workers is shaped by social relations as well as group dynamics. Several conditions have an effect on employers during the time of decision making; for instance, the process how workers conduct themselves and behave in the organization. Essentially, the organizational culture is a broad idiom used to illustrate the set of values, norms, artefacts and beliefs that symbolizes the organization attributes, and offers the behaviour environment in it. Furthermore it is a term employed for examining multifaceted businesses, with the stress circling around the growth of collective suppositions, connotations, values, as well as beliefs which form and are supported by workers’ behaviour at business and cultural environments. To capitalize on organizational functionality, organisation needs an organizational culture that motivates workers to be trained, develop and offer their unsurpassed effort. Most favourable business operation is influenced by the management and leadership style as well as organizational culture that reflect environmental alterations, and worker driving force. Kimball (2011, p.56) posit that such a culture advances needs an innovative workers behaviours that are indispensible so that innovation to become established. Section 4 4.1 Discussion of the significance of international trade to UK business organizations Indubitably, international trade is the contemporary backbone of business organisations, as manufactures in UK attempt to gain from a long-drawn-out market, instead of being restricted to selling within UK only. There are scores of reasons why international trade takes place, which includes lower costs in production in one country as compared to another country, consumers preferences, and surplus or lack of natural resources. At the moment, lower cost of productions in developing economies remains to be the most contentious elements of international trade (Smith-Hillman & Omar, 2008, p.75). Presently, there is a lot of concern with regards to jobs being carted off from European Union’s member countries such as UK as well as other developed economies like United States. Notably, UK, which is a member state of European Union have imposed relentless restrictions on goods and services stemming from Asian countries in attempt to halt this wave. Plainly, organisations whose workforce are paid one dollar a day have a unique advantage over the organisations paying their employee a dollars an hour. Nonetheless, UK buyers are just too contented to reduce their costs of living by making the most out of imported goods sold cheaper (Smith-Hillman & Omar, 2008, p.71). 4.2 Analysis of the impact of global factors on UK business organisations Presently, businesses are influenced by an external setting to the degree that they are influenced by their rivals. The global factors that impact UK business organisations are economic, technological, social, political, and legal. Understanding of these factors is important while developing a business strategy. Social factors are factors connected to social structures alterations. According to Williamson et al. (2006, p.151) social factors offer perspective into lifestyles, preferences, and behaviour patterns of UK inhabitants. What’s more, buying patterns are to a great extent affected by the changes in consumers’ lifestyles as well as population structure. Legal factors are factors that impact the organisation strategies and are connected to amendments in government rules and regulations. So that business organisations operate successfully in UK it is imperative that the organisations take into account the involved legal issues in a certain state of affairs and must have the ability to expect ways wherein laws amendments will have an effect on the manner they ought to act. Economic factors, on the other hand are factors involved in global financial system. For instance, an increase in costs of living would in the end lead to an increase in products demands; thus, offering better chances for UK business organisations to make profits. Political factors refer to alteration in government policies, and these factors to a great extent impact the business operation. Finally, Technological factors significantly affect organisational strategies given that they offer opportunities for organisations to implement new-fangled inventions and innovations. 4.3 Evaluation of the impact of the European Union policies on UK business organisations The European Union policies have had a momentous impact upon global trade, on UK. Within Europe, trading between European Union member states has turn out to be less restricted, owing to the regulations and laws approved. Furthermore, trade hurdles in UK has been almost removed and severe laws have been used to make sure there is fair competition for all business organisations. According to Bishop et al. (2000, p.312) it is partly ensuing from the countries crying to be part of European Union. The European policies as well defend UK business organisations from unjust competition methods that other countries or organisations may utilise. Furthermore, EU policies offer protection that permits small-medium enterprises in UK and other member countries to get a more rapid economic growth rate as well as compete on realistic terms. 5.0 References Abdullah, M.H. & Rashid, N.R.N.A., 2012. The Implementation of Corporate Social Responsibility (CSR) Programs and its Impact on Employee Organizational Citizenship Behavior. International Journal of Business and Commerce, vol. 2, no. 1, pp.67-75. Bishop, K., Tewdwr-Jones, M. & Wilkinson, D., 2000. From Spatial to Local: The Impact of the European Union on Local Authority Planning in the UK. Journal of Environmental Planning and Management, vol. 43, no. 3, pp.309-34. Cuciniello, V., 2005. The Impact of Fiscal-Monetary Policy Interactions on Government Size and Macroeconomic Performance. Economic Modelling, vol. 26, no. 5, pp.918-25. Kimball, B., 2011. Creating an Awareness and Understanding of Business and Cultural Environments Through the Integration of Classic Literature and Film into Traditional Course Work. Southern Business Review, vol. 36, no. 2, pp.51-58. Levis, A.A. & Papageorgiou, L.G., 2007. Active Demand Management for Substitute Products through Price Optimisation. OR Spectrum, vol. 29, no. 4, pp.551-77. Pater, A. & Lierop, K.v., 2006. Sense and sensitivity: the roles of organisation and stakeholders in managing corporate social responsibility: [1]. Business Ethics, vol. 5, no. 4, pp.339-551. Rodwell, J.J. & Teo, S.T.T., 2004. Strategic HRM in for-profit and non-profit organizations in a knowledge-intensive industry: the same issues predict performance for both types of organization. Public management review, vol. 6, no. 3, pp.311-31. Shaoul, J., 2005. A critical financial analysis of the Private Finance Initiative: Selecting a financing method or allocating economic wealth? Critical Perspectives on Accounting, vol. 16, no. 4, pp.441-71. Smith-Hillman, A.V. & Omar, M., 2008. FDI, international business and regulation: The behaviour of UK multinational corporations. European Business Review, vol. 17, no. 1, pp.69-82. Williamson, E.A., Jordan, M. & Harrison, D.K., 2006. The impact of organisational factors at different levels of IOS development on supply chain partnerships. International Journal of Internet and Enterprise Management, vol. 4, no. 2, pp.148-61. Read More