Professional Documents
Culture Documents
& TITLE:
QUALIFICATION: PEARSON BTEC LEVEL 4 HNC BUSINESS
YEAR: 2018-2019
PREPARED BY: RACHITA SOMPURA
ASSESSOR NAME: GRACY SERRAO
REPORT
INDEX
Sr. CONTENT PAGE
No. NO.
1. Cover Page
2 Introduction
3 LO1
P1: Explain different types and purposes of organizations; public, private and
voluntary sectors and legal structures.
M1: Analyze how the structure, size and scope of different organizations link to
the business objectives and product and services offered by the organization.
4 LO2
P2: Explain the size and scope of a range of different types of organizations.
P3: Explain the relationship between different organizational functions and how
they link to organizational objectives and structure.
5 LO3
P4: Identify the positive and negative impacts the macro environment has upon
business operations, supported by specific examples.
6 LO4
P6: Explain how strengths and weaknesses interrelate with external macro factors.
M4: Apply appropriately SWOT/TOWS analysis and justify how they influence
decision-making.
D2: Critically evaluate the impacts that both macro and micro factors have upon
business objectives and decision-making.
7 Conclusion
Introduction
Any business has to work in its environment – both internal and external – and is
deeply affected by it. This business environment is very complex and dynamic. For
any business to succeed – to survive indeed – there is a necessity for managers and
strategists to not only identify and understand the changing environmental factors
but also to anticipate and forecast those which could affect the business
organization. It is also crucial to take care of the various ethical issues involved in
running a business.
There is close association between business and its environment. Business
environment refers to various forces that influence the functioning of business.
Business environment can be defined as both internal and external factors that have
a bearing on a company’s operating situation. It plays a significant role in shaping
the business decisions and strategies of a company.
The Coca-Cola Company is an American corporation, and manufacturer, retailer, and marketer
of nonalcoholic beverage concentrates and syrups. The company is best known for its flagship
product Coca-Cola, invented in 1886 by pharmacist John Stith Pemberton in Atlanta, Georgia.
According to The Coca-Cola Company's 2005 Annual Report, the firm at that time sold beverage
products in more than 200 countries.[29] The 2005 report further states that of the more than
50 billion beverage servings of all types consumed worldwide, daily, beverages bearing the
trademarks owned by or licensed to Coca-Cola account for approximately 1.5 billion.
LO1: Explain the different types, size and scope of Organizations.
P1: Explain different types and purposes of organizations; public, private and voluntary
sectors and legal structures.
Public sectors
Benefits of privatisation:
Reduces costs - the profit motive, and competitive pressures will drive costs down.
Often a state regulator ensures that private firms do not exploit their monopoly
position in the market.
Increases choice
Increases quality
Encourages innovation and invention
Brings market forces into play in a positive manner for the consumer
Saves the government money - the costs of the nationalised industries would be
replaced by income from business taxes
Widens share ownership in the population
Problems of Privatisation:
Monopolies will be in private hands and need regulating e.g. Nuclear industry,
transport
Loss of income for the government - the general public loses a valuable resource
Externalities - a private firm may not be so careful about environmental issues
Unlike the private sector where the generation and return of profit to its owners is emphasized, money
raised or earned by an organization in the voluntary sector is usually invested back into the community or
the organization itself.
Functional Structure
Most businesses adopt a functional organizational structure with a chain of command: Different
functions go into separate departments that report to department managers, who then report to
someone higher up. If you adopt a functional structure, it has the advantage of clear lines of
authority, with key decision-makers in each department who set the overall mission and tasks.
The structure allows each employee to concentrate on her particular mission. A functional
structure for an organization is not without its drawbacks, however. You can end up with
departments that don't talk to each other or cooperate well. A customer may get bounced from
department to department if his problem doesn't relate to one particular function.
Divisional Structure
A divisional organizational structure spreads functions across different branches: If you have
different product lines, the division for each product line has its own functional groups such as
marketing, R&D, sales and accounting. The advantage of this approach is that each division of
the company has the personnel to carry out all necessary functions. In essence, each division
can carry out its business operations more or less autonomously. The drawback is that with
employees in each division performing identical functions, you could end up with a lot of
redundancy and inefficiency. For instance, managing five human resource operations, rather
than a single, centralized operation, means duplication of functions, managements systems,
policy development and so on.
Matrix Structure
Using a matrix structure in your business can give you greater flexibility in business functions
than a more hierarchical organization. In a matrix structure, each employee works in a function-
based department, such as marketing or finance, but they can be assigned to projects under
different managers and teamed with employees who have different functions. This structure
adapts organizational function to changing organizational needs. The drawback is that the chain
of command in a matrix may become cloudy and conflicted.
Organizational Charts
If you or your staff have trouble visualizing a proposed structure, you can use an organizational
chart to see it clearly. The New York and Erie Railroad developed the first organizational charts
in the 19th century as a way to improve management efficiency. A chart shows the lines of
authority and control running between different departments and levels of management. A well-
designed chart will make it easy to see who makes decisions, who reports to whom and how
your organization divides up its operating functions.
M2: Analyze the advantages and disadvantages of interrelationships between organizational
functions and the impact that can have upon organizational structure.
D1: Provide a critical analysis of the complexities of different types of business structures
and the interrelationships of the different organizational functions.
LO3: Use contemporary examples to demonstrate both the positive and negative
influence/impact the macro environment has on business operations.
P4: Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples.
The major external and uncontrollable factors that influence an organization's decision making, and
affect its performance and strategies. These factors include the economic factors; demographics;
legal, political, and social conditions; technological changes; and natural forces
PESTEL Analysis
A pestle analysis is one the method to analyses the external factors that affects the
business. This can be used with other methods to analyses the internal factors. This
is used to create the strategic plan for the business and the upcoming opportunity for
the business. Pestle stands for political, economic, social, technological,
environmental and legal factors (Tucker, 2009).
Economic:
There may be countries which are poor or underdeveloped or may be in a developing
stage. This affects the pricing of the Coca-Cola product. People may be poor and due
to credit crunch they may like to invest their money in more important items like food,
accommodation, clothing etc. that affects the company’s business (Will, 2007).
Social:
Social issues are like age, heath factors of a particular place, where maximum number
of people are of higher age and taking beverages is not good for their health that
affects the company business.
Technological:
Technology plays a very important role these days, the countries which have better
technology there are facilities for better packaging systems, automation process, more
R&D activities and growing economy. Hence in such a case the Coca-Cola has to take
advantage and can grow their operations there. People are more advance in such
country they require innovation and change from time to time as well as they are more
informed about the product and service they are using. Hence, the company needs to
be more careful, honest and advance in such a place (Julian, 2012).
Environmental:
Environment factors like hot and cold climate, there are places which are very cold
throughout the year their people would prefer a warm beverage over the cold one.
There are places which are hot in climate and their consumption of water and cold
beverages are more. Hence, Coca-Cola sale strategies should keep such factor in
mind (Murden, 2005).
Legal:
Legal factors are particularly related to the tax and legal laws of the country. There
may be high tax in some countries and in some countries there may be no tax on the
food and drink items. In some counties Coca-Cola is paying high tax but generating
less revenue. In such cases the company strategies for pricing differs and it particular
affects the decisionmaking for Coca-Cola.
M3: Apply appropriately the PESTLE model to support a detailed analysis of the macro
environment within an organization.
LO4: Determine the internal strengths and weaknesses of specific businesses and
explain their interrelationship with external macro factors.
P5: Conduct internal and external analysis of specific organizations in order to identify
strengths and weaknesses.
The internal business environment and its effects is contained within the company’s
management. The essential internal environments that Coca-Cola ensures are put in
place include effectiveness in the production procedure, proper organization skills and
effective communication networks. To effectively monitor and manage its internal
environment, coke conducts assessments of it is operations and responds appropriately
to any aspect, which is likely to cause ineffectiveness in any section of the consumer
and production procedure (Njanja, Ogutu, & Pellisier, 2012).
They are also termed as outer business environment. The external business
environments are more powerful than internal business environment factors. They can
affect the entire company or economy. Coca-Cola is aware that alterations in the
external settings can create achievements or threats in its market place. Some of the
keenly monitored external business environmental aspects comprise of, customer
attitudes, instabilities in the economy and demographic patterns. This can affect the
reception given from the customers.
http://www.valueline.com/Stocks/Highlights/The_Coca-
Cola_Company__A_Short_SWOT_Analysis.aspx#.W_7ROWgzY2w
Economic factors: The economic environment can impact both the organisation’s
production and the consumer’s decision making process.
Natural/physical forces: The Earth’s renewal of its natural resources such as forests,
agricultural products, marine products, etc must be taken into account. There are also the
natural non-renewable resources such as oil, coal, minerals, etc that may also impact the
organisation’s production.
Technological factors: The skills and knowledge applied to the production, and the
technology and materials needed for production of products and services can also impact
the smooth running of the business and must be considered.
Political and legal forces: Sound marketing decisions should always take into account
political and/or legal developments relating to the organisation and its markets.
Social and cultural forces: The impact the products and services your organisations
brings to market have on society must be considered. Any elements of the production
process or any products/services that are harmful to society should be eliminated to
show your organisation is taking social responsibility. A recent example of this is the
environment and how many sectors are being forced to review their products and
services in order to become more environmentally friendly.
Introduction:
Business environment is the total of external and internal factors that affects the
company’s operations and functions like customers, employees, stakeholders,
demand and supply, competitors etc. These external and internal factors are dynamic
in nature, they keeps on changing which is unpredictable. Business environment is
different in every country. Every business has some objectives which they need to
accomplish and sustain themselves in the market. Every organization should do a
study on their business environment to understand the market and the future
prospects related to planning and action for the betterment of the organization and
achieving the organisational objectives. The below is the detailed analysis about the
company name Coca-Cola, a well-known and renowned brand of beverages across
the globe.
Coca-Cola started its journey in the year 1886, when Dr. John S. Pemberton who was
a pharmacist wanted to create a soft drink with distinctive taste. He created a flavored
syrup get the same tested at the pharmacy and it was liked by those who tested it. Dr.
Pemberton and his partner Frank M. Robinson opened the company name Coca-Cola.
It started with the 9 servings per day for 5 cent per glass in Atlanta but now its 1.9
billion servings per day are estimated globally. In next 2 yrs. the company was sold to
various parties after it becomes the world’s number one sparkling drink(Myanmar,
2012).The distribution of Coca-Cola was expanding, the growth rate was very high
and hence the company decided to make portable beverage. They installed the bottle
plant for Coca-Cola. Benjamin Thomas, Joseph Whitehead and John Lupton
purchased the bottling rights and made the bottling system of Coca-Cola worldwide(
Houpt, 2011).
With the growing needs and demand of the industry there were many challenges faced
by the bottlers, the plants at that time were capable of producing 1000 bottles at a
time. So the bottles decided that this drink a distinctive and standard bottle. Contour
bottle was selected in 1916. The new bottle was very unique and catchy, it can
recognize in the dark also and it sets the co-cola brand apart from its competitors. In
1977 the bottle got the trade mark and there are many artists who keeps on working
on the logo and designing of the Coca-Cola.
In 1987, the first marketing tactic was considered which distribution of coupons for the
free sample was. It was an innovative tactic and after they advertised Coca-Cola in
newspapers. After that many advertising campaigns took place like Many fondly
remember the 1971 Hilltop Singers performing “I’d Like to Buy the World a Coke”, or
the 1979 “Have a Coke and a Smile” commercial featuring a young fan giving
Pittsburgh Steeler, “Mean Joe Greene”, a refreshing bottle of Coca‑Cola
(Geuss,2010). People started relating the brand of Coca-Cola with friends, fun and
good times.
In 2009, the campaign name “Open happiness” took place globally. It gives a simple
message to enjoy the small events of happiness around us. We need to halt, enjoy
and get back to work. The campaign message was seen all over the place on
television, radio, shops, billboards, Printed advertisement. It was also the part of
various sports events and these campaigns ran for about a year through videos,
tweets, pictures, bogs etc.There is a connection baton wellness and happiness and
Coca-Cola is playing a big part into the same around the globe.
Various Micro and Macro environment factors can be analyzed by using SWOT and
PESTLE framework for Coca-Cola. It affects the decision making, helps in facing and
fighting the competition and also ascertaining the future of the company by defining
the threats. It is not confirmed to the profit making rather they are wonderful tool for
strategizing the planning and action for Coca-Cola. (Kripalani and Mark, 2003).
Culture
Every organization has it unique characteristics and personality, like any person.
These unique characteristics makes an organization culture.Organisation culture
affects the Behaviour of the people working together to achieve company’s objectives.
It is a kind of invisible force. Organisational culture is process of shared values,
assumptions, beliefsetc. that affects the behavior of the people working with that
organization. It affects how they act, dress and perform their tasks. It is kind of
boundary and guideline that makes a unique culture (Barbara and David, 2007).Every
organization has some unique characteristics on the basis of which the culture is
formed. Innovation is one characteristic, the employee’s takes high risk and brings
something new in the organization if organization believes in innovation, otherwise the
employees do their work in the same manner always. The organization which gives
more emphasis to attention to detail are likely to see better results rather than those
who gives less importance to attention to detail. There are organization which are more
outcome oriented , they does no emphasis on the process of work they only requires
the results. There are organization which provide fair treatment to their employees in
terms of salary, treatment etc. and give them dignity and respect. There employees
are more likely to stay with the organization and have low attrition rate. Teamwork is
another important aspect for any company, where there is more emphasis on team
work , people are likely to have better relationships with their managers, subordinates
and peers (Orozco, 2006).
The above characteristics define an organisational culture. The more positive
organization culture is likely to have more success rate and satisfaction within the
employees.
Coca-Cola culture is defined by the seven values they follow which are passion,
leadership, integrity, diversity, collaboration, accountability and quality. They believe
in creating valued culture and making a difference. With the change in the business
environment the culture of Coca-Cola has also changed. They believe in two assets
that is their people and their brand. They are dealing with worldwide diverse staff
members, ideas and talents. They are able to embrace the diverse world and creating
sustainability (Jessica, 2011). They have programs which retain and attract the
diverse talent. They believe in respecting humans and giving them a better workplace
as part of their culture and sustaining business. Coca-Cola is also providing a safe
and healthy work environment. Every individual is important to them and they have a
right for workplace safety (Hamowy, 2007).Business partners and suppliers are core
for their business success, so they are following supplier guideline principles that gives
importance to responsible workplace practices and policies and applicable to the local
labor laws, technology, environment and regulations. Theyalso practice Anti-bribery
law for protecting company’s reputation. There are more than 70000 associates who
are making the Coca-Cola system. They believe in environment where everyone’s
talent and ideas are encouraged. They have open flow of communication where staff
member can discuss the issues, share ideas, information, share success and
information, increase awareness. Various development programs are there in which
the people can learn and grow their skills, they are also offering the best competitive
packages as per the industry standards. High performers are rewarded and
recognized(Boville, 2004).
Hence, with the changing business environment Coca-Cola is working hardtop give
fair treatment to their workers, manage the diversity programs on regular basis and
developing enhanced understanding with suppliers, stakeholders, colleagues and
customers (D'Amato, Fasoli, Kravchuk, Righetti,2011).This is a long term strategy
which gives rise to the long term success of the company. If the company is rigid and
not ready to change with the changing environment , they may not be able to sustain
in long run. But with the company like Coca-Cola which is globally present , have to
deal with the cultural issues on daily basis and they are imbibing the new practices
and changes. They’re understanding the external and internal factors that are
responsible for the growth of their organization and leading towards success at the
marketplace (Esterl, 2011).
References
In June 2012, Coca-Cola announced its intentions to begin distributing
in Myanmar.Stafford, Leon (September 9, 2012). "Coca-Cola to spend $30 billion to
grow globally".The Atlanta Journal-Constitution. Retrieved January 24, 2013.
Houpt, Simon (October 4, 2011). "Apple cracks Interbrand’s best global brands top 10
list". Globe and Mail (Toronto).
Geuss, Megan (October 2010). "First Coupon Ever". Wired 18 (11): 104.
Richard Gardiner, “The Civil War Origin of Coca-Cola in Columbus,
Georgia,”Muscogiana: Journal of the Muscogee Genealogical Society (Spring 2012),
Vol. 23: 21–24.
Mark Pendergrast (March 16, 2000). For God, Country and Coca-Cola. Basic Books.
p. 25.
Benson, Drew (2004-04-19). "Coca kick in drinks spurs export fears". The Washington
Times (The Washington Times, LLC). Coke dropped cocaine from its recipe around
1900, but the secret formula still calls for a cocaine-free coca extract produced at a
Stepan Co. factory in Maywood, New Jersey.
Harford, Tim (May 11, 2007). "The Mystery of the 5-Cent Coca-Cola: Why it's so hard
for companies to raise prices". Slate. Archived from the original on July 10, 2007.
Mark Pendergrast (March 16, 2000). For God, Country and Coca-Cola. Basic Books.
p. 32.
Katie Rogers, "'This American Life' bursts Coca-Cola's bubble: What's in that original
recipe, anyway?," Washington Post BlogPost, February 15, 2011, retrieved February
16, 2011.
Brett Michael Dykes, "Did NPR’s ‘This American Life’ discover Coke’s secret
formula?,"The Lookout, Yahoo! News,February15,2011.
David W. Freeman, "'This American Life' Reveals Coca-Cola's Secret Recipe (Full
Ingredient List)," CBS News Healthwatch blogs, February 15, 2011.
May, Clifford D. "How Coca-Cola Obtains Its Coca", The New York Times, July 1,
2006. Retrieved December 4, 2007.
Stafford, Leon (September 9, 2012). "Coca-Cola to spend $30 billion to grow
globally".The Atlanta Journal-Constitution. Retrieved January 24, 2013.
Will Weissert (May 15, 2007). "Cuba stocks US brands despite embargo". USA Today.
Associated Press. Retrieved August 11, 2013.
Julian Ryall (August 31, 2012). "Coca-Cola denies 'cracking' North Korea". The
Telegraph (London). Retrieved August 11, 2013.
Murden, Terry (January 30, 2005). Coke adds life to health drinks sector. Scotland on
Sunday. Retrieved February 14, 2006.
Kripalani, Manjeet and Mark L. Clifford (February 10, 2003) "Finally, Coke Gets It Right
in India". BusinessWeek. Retrieved August 9, 2006.
Barbara Mikkelson and David P. Mikkelson, "The Claus That Refreshes," snopes.com,
February 27, 2001 . Retrieved June 10, 2005. Archived 10 July 2007 at WebCite.
Orozco, Cynthia E. Quintanilla Perez, Selena. The Handbook of Texas online.
Retrieved on June 5, 2006.
Jessica Burke (September 26, 2011). "Sharing your Coke: marketing genius or just
entirely weird? | Food Magazine". Foodmag.com.au. Retrieved February 23, 2013.
Hamowy, Ronald (2007). Government and public health in America (illustrated ed.).
Edward Elgar Publishing. pp. 140–141. Nikki Sandison (November 16, 2007). "Coca-
Cola revives popular 'holidays are coming' ad". Brand Republic.
Boville Luca de Tena, Belén (2004). The Cocaine War: In Context: Drugs and Politics.
Algora Publishing. pp. 61–62. ISBN 978-0-87586-294-1.
Tucker, Sundeep (March 18, 2009). "China blocks Coca-Cola bid for
Huiyuan".Financial Times (Hong Kong). Retrieved March 18, 2009.
Esterl, Mike (December 1, 2011). "A Frosty Reception for Coca-Cola's White
Christmas Cans". The Wall Street Journal.
D'Amato, Alfonsina; Fasoli, Elisa; Kravchuk, Alexander V.; Righetti, Pier Giorgio
(2011-04-01). "Going Nuts for Nuts? The Trace Proteome of a Cola Drink, as Detected
via Combinatorial Peptide Ligand Libraries". Journal of Proteome
Research (American Chemical Society) 10 (5): 2684–2686.
https://smallbusiness.chron.com/objectives-private-companies-61862.html
http://www.privacysense.net/terms/voluntary-sector/
https://www.scribd.com/document/135997612/public-private-voluntary-sector-for-PRM-
pdf?doc_id=135997612&download=true&order=454187800
https://businesscasestudies.co.uk/business-theory/strategy/public-and-private-sectors.html
https://pestleanalysis.com/swot-analysis-coca-cola/
https://myassignmenthelp.com/free-samples/business-environment-coca-cola
http://www.businessdictionary.com/definition/macro-environment.html
https://blog.oxfordcollegeofmarketing.com/2014/11/04/the-impact-of-micro-and-macro-
environment-factors-on-marketing/