Etisalat And TAQA 1

Running Head: ETISALAT AND TAQA

The Business Environment

[Name of the Writer]

[Name of the Institution]

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Table of Contents

1 INTRODUCTION..............................................................................................................3

2 TASK 1..............................................................................................................................3

2.1 Correlation and Impact of Different Stakeholders on Etisalat.......................................................................3

2.2 Style of Operation within the Organisation....................................................................................................4

2.3 Comparison and Impact of the Economic Challenges on Etisalat..................................................................4

2.4 Influence of Future Changes on Etisalat Growth Strategies..........................................................................5

3 TASK 2..............................................................................................................................6

3.1 Types of Business, Purposes and Ownership.................................................................................................6

3.2 Influence of Stakeholders on Two Contrasting Businesses............................................................................6

3.3 Stakeholder Views on two Contrasting Businesses........................................................................................7

3.4 Organisation of Etisalat and TAQA.................................................................................................................7

3.5 Influence of Internal and External Factors on Business Activities..................................................................7

4 CONCLUSION..................................................................................................................8

REFERENCES...........................................................................................................................9
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The Business Environment

1 Introduction
Before venturing a new business, it is essential for the owner to understand the
business and the business environment. Similarly, it is crucial for the owner to understand as
well as identify the economic, internal and external factors that has a huge impact on the
trades. and industries (Hamilton and Webster 2018). Business environment can be defined as
the external and internal factors that has an influence on the organisation’s functions,
operations, demand and supply, customers, business regulation and management. It is
considered as the owner’s responsibility to identify and perform strategic planning through
which business can easily align themselves in the market (Çera et al., 2019). This assignment
aims towards discussing about the correlation and impact between the different stakeholders
present in Etisalat and TAQA organisations. Moreover, it will explain their functional areas,
strategic planning process as well as their future challenges that helps them grow in the
market. In addition to this, several aspects of that determine output decisions of the business
entity will be thoroughly discussed in this assignment.

2 Task 1
2.1 Correlation and Impact of Different Stakeholders on Etisalat
Etisalat group is one of the topmost telecommunication organisation in today’s
technological market. They aim towards providing the best and innovative solutions that aids
in driving the digital future for empowering the societies (Veselovsky et al., 2017).
Stakeholder’s play a vital role in their organisation. Stakeholders includes, customers,
government, shareholders, suppliers, employees as well as owners. All of these has a huge
impact over one another. In an organisation, people are stakeholders due to the financial
reasons as consumers look for those products that are reasonable and effective. They do not
like to spend money on expensive products as if the competitors of Etisalat are able to
develop same products at lower rates, people will prefer them. Without consumers, no
organisation can lead in the market (Rozalia and Aurel 2019). Similarly, employees and
suppliers are important as other stakeholders as without their combined efforts their products
will be unable to reach the global market as well as the potential consumers. Employees of
Etisalat directly deals with the customers and recommend them their products that bring more
profit to the organisation. Employees exert a huge impact on this organisation as their
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activities and intrests are corelated with the profit and loss of the organisation. The third
stakeholder of Etisalat are suppliers that are external stakeholders. Suppliers are the ones that
provides good and services to the customers. Suppliers are important as without them Etisalat
would not be able to reach the general public and generate profit. The impact suppliers exert
on Etisalat is that they produce quality products and helps in maintaining the customers
loyalty towards the organisation. Government is considered as a vital stakeholder as they are
concerned about the employment opportunities provided by Etisalat. Moreover, they also
help the organisation during time of recession. Trade unions are external stakeholder of the
business as they are not informed when important decisions are made (Thabit and Ibraheem
2019). Etisalat has been highly influenced by trade unions as their employees can raise their
voices in case of any unfair treatment of low wages. All these stakeholders are corelated and
exerts a huge impact on the organisation.

2.2 Style of Operation within the Organisation

Etisalat is considered as leading organisation in UAE that is presently operating in
more than 15 countries across Europe, Asia Africa and middle east. Functional areas of
Etisalat include marketing, sales, customer services, accounts and production department
(Prajogo 2016). Similarly, the organisational structure of Etisalat outlines how certain
activities within the organisations are directed in order to accomplish the organisational aims
and objectives that immensely helps in their further progress. These activities comprise of
responsibilities, roles and rules that determines how the information flows among different
functional areas. This helps in formulating strategic plans that helps Etisalat to increase their
profits and lead in the market. This organisation follows the matrix structure as it helps them
in handling several projects at the same time. According to the CEO of Etisalat, “Etisalat
Group aims towards driving the Digital Future to empower societies in order to provide best-
in-class total customer experience domestically and internationally (Çera et al., 2019).
Moreover, their mission is to deliver attractive returns to shareholders while investing in the
long-term future of the company and supporting economic development in all our operating
markets.” Their unique style of operation helps them in achieving their set targets through
their functional areas and matrix organisational structure that affects the operating procedure
and planning processes.
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2.3 Comparison of the Economic Challenges on Etisalat

Etisalat can be affected by various factors within their economic environment. The
economical challenges consist of high demand, recession, low demand period, transportation
cost, labour cost and growth (Abomaye et al., 2019). Each of these factors individually
influences the business. Etisalat is highly affected by two major economic challenges termed
as low demand and recession. During the time of recession, the demand of their products
immensely decreased. Recession bring huge disappointment and downturn for this
organisation that not only restricts their growth and progress but also affects the financial
conditions (Kljucnikov et al., 2016). When the demand of the product is decreased, the
company suffers in terms of low income and profit. The strategy of Etisalat is to keep up with
their customers demand and for that they are required to work towards attracting more
customers towards their products and beat their competitors by selling quality products
during economic challenges.

2.4 Impact of Economic Challenges on Strategies

During this challenging time, Etisalat has immensely focused on sales and fulfilling the
needs of their potential consumers by introducing such products that are reasonable for the
customers. This strategy will help them in maintaining their profit and sales during recession
and enhance the value as well as sales of their telecom products. Etisalat will be required to
keep up with the demand of the products in the market (Thabit and Ibraheem 2019). In
addition to this, the need to keep up with the trending technologies that are produced by the
competitors and ensure that they provide their customers quality merchandises at reasonable
rates. Moreover, this economic challenge immensely influences the supply and demand
curves causing the organisation to decrease their product’s prices. This directly results in
company having lower sales and loss. Unemployment and wages are decreased, stock market
is highly affected causing a huge downturn in the business.

2.5 Influence of Future Changes on Etisalat Growth Strategies

The changes in the economic condition influence the businesses largely. It is essential
for the organisations to identify the factors that can affect the growth and operation strategies.
Etisalat group is always working towards adapting to keep up with the future variations
within legal, political, social and economic factors (Thabit and Ibraheem 2019). These
elements influence the organisations in the past and current condition continues to affect
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them in future. One of the vital economic factors that continues to affect this company is
recession. According to Allen (2016), “if a recession hits an organisation, then there is less
money circulation in the market”. This economic challenge is not good for Etisalat as they are
dependent on circulating money (Kljucnikov et al., 2016). Moreover, political, social factors
are needed to be considered while formulating future strategies as government policies
constantly changes that has the power to influence the business and the investment strategies
for future growth.

3 Task 2
3.1 Types of Business, Purposes and Ownership
Etisalat id an international blue-chip organisation. It is a multinational organisation
that provides its services and innovative solution to approx. 148 million subscribers in 16
countries across middle east (Tapang and Bassey 2017). This organisation is one of the best
and leading groups in the telecommunication industry. Its ownership structure changes as the
UAE government has a share of 60% in the company while the remaining 40% share is
traded publicly (Hamilton and Webster 2018). The vital purpose of this organisation is to
empower society by digitalising the future as well as reshape the lives of people. It is a
service business that provide technological services to the people all over the world. In
contrast to this, TAQA is Abu Dhabi’s National energy company, that is completely
controlled by the government entities of UAE. This organisation is considered as a flagship
company that plays a vital role in UAE’s economic strategy. Tis organisation is operating in
11 countries across the four continents. Their purpose is to provide efficient, sustainable and
safe energy solutions to their consumers. This organisation work towards gas and oil
exploration and pipelines, production, water distillation, underground gas storage and power
generation.

3.2 Influence of Stakeholders on Two Contrasting Businesses

A stakeholder can be referred to as “anyone with interest in business that are affected
by the activity of the business”. The consumers in any business expects that the organisations
must provide high quality merchandises that are reasonable and improves the quality of life.
Consumers highly impacts Etisalat and TAQA as they are considered as major stakeholders
and their sales and profits are based on the purchasing of the services provided by these
companies (Abomaye et al., 2019). Employees are considered as internal stakeholders in
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TAQA and Etisalat as their activities, efforts increases the merchandise sales in the global
market. Employees in both the businesses are considered as the main part as they play a main
role in the successful running of businesses. On the other hand, suppliers, government and
trade unions are considered as internal stakeholders that creates employment opportunities
and handles legal entities. In addition to this, governments ensure that the business grow and
prosper providing huge benefits to the public.

3.3 Stakeholder Views on two Contrasting Businesses

Etisalat has a vison to empower the society through their digital and technological
products that helps in improving the society. The key stake holders of both the contrasting
businesses are government, investors, suppliers, employees and consumers. From the
perspective of government, the legal entities ensure that both companies provided quality,
safe and sustainable products to the public that brings sustainability in the environment.
Moreover, they ensure that employment opportunities are introduced, and the business
entities pays taxes. Investors are another important stakeholder for both the companies as it
helps then in receiving high dividends and make more profit (Prajogo 2016). If these
organisations do not have investors, it will immensely influence their objectives and aims.
Both business entities aim towards maintaining customer loyalty by building up a high
corporate image in the market. And this cannot be achieved without the efforts of suppliers
and employees. The workforce constantly engages themselves in such activities that aids in
reaching the potential clients and provide them customer friendly services.

3.4 Organisation of Etisalat and TAQA

The organisational structure of both the complementary businesses is quite different
along with their contrasting aims and objectives that helps in their growth and development.
TAQA is famous for providing leading products and services in the energy industry whereas
Etisalat is a leading telecommunication provider company in UAE. The organisational
structure is matrix based as it helps them for the flow of information and making important
decisions while TAQA has a centralised structure (Rozalia and Aurel 2019). The major
factors that influences these businesses are recession, political elements, inflation, demand
and supply. Their purpose is to improve the living condition as well as introduce
sustainability in the global environment. Their functional area of TAQA comprises of
production and investment, planning and corporate financing, corporate development, human
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resource and drilling services. Contrary to this functional area of Etisalat include marketing,
sales, customer services, accounts and production department. Their vison, aims and goals are
different due to their contrasting businesses, but both aim towards growth and development in
the global market.

3.5 Influence of Internal and External Factors on Business Activities

Organisations are hugely influenced by the political, social, legal and economic
factors. In addition to this, stakeholders play a significant role in strategic planning and
successful operation of the business. Political stability is essential for the smooth running of
the businesses. Both these organisations are supported by the UAE government that helps
them in competing with the other private firms (Thabit and Ibraheem 2019). Moreover, taxes
are encouraged by the governments that influences the business activities. Both of the
organisation has been affected by political environment at local as well as national level. The
changes in the pensions or other issues affects the employees. Other than this, corporate
taxes, inflation, demands affects the profit and sales of the organisation at greater extent.

3.6 Analysing the Political, Social and Legal Factors

These can be easily evaluated through various tools and strategies such as PESTAL
analysis and PEST strategical tool. Political stability is essential for the smooth running of the
businesses. Both the businesses are required to identify these factors and formulate such
strategies that helps in reducing the impact on the company’s progress and sales. The fall and
rise of these factors continue to influence the business sometimes in a positive manner or in a
negative way.

4 Conclusion
This assignment gives insights on the business environment and its importance before
venturing a new business. The organisation structure, functional areas, aims, purpose and
economic challenges of Etisalat and TAQA has been thoroughly discussed. Moreover, the
impact of social, legal, economic and legal factors have been explained in the assignment.
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