ASSIGNMENT BRIEF

Qualification Unit Number And Title

PEARSON BTEC HIGHER NATIONAL DIPLOMA IN 01. BUSINESS & THE BUSINESS ENVIRONMENT
BUSINESS (RQF) (LEVEL 4)

Internal Verifier Unit Tutor

ZAFARULLAH SANJRANI

Date Issued Submission Date

21 April, 2021 7 June, 2021

Resubmission Date 31 June, 2021

Assignment Title Business Environmental Analysis

ASSESSMENT CRITERIA TASK NUMBER EVIDENCE PAGE NUMBER

PASS 1 TASK 1
PASS 2 TASK 1
PASS 3 TASK 1
PASS 4 TASK 2
PASS 5 TASK 2
PASS 6 TASK 2
MERIT 1 TASK 1
MERIT 2 TASK 1
MERIT 3 TASK 2
MERIT 4 TASK 1
DISTINCTION 1 TASK 1
DISTINCTION 2 TASK 2

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CONTENTS

INTRODUCTION 4

BUSINESS OBJECTIVES 4

TYPES OF ORGANIZATION 5

LEGAL STRUCTURES 6

SIZE OF AN ORGANIZATION 6

SCOPE OF AN ORGANIZATION 7

KEY STAKEHOLDERS 7

SIZE AND SCOPE OF DIFFERENT TYPES OF ORGANIZATIONS: 7

PAKISTAN STATE OIL (PSO) 7

TOTAL PARCO Ltd 8

OGDCL Ltd 8

HOW STRUCTURE, SIZE AND SCOPE OF VARIOUS BUSINESSES LINK WITH

BUSINESS STRUCTURE 8

RELATIONSHIP BETWEEN ORGANIZATIONAL FUNCTIONS AND THEIR LINKAGE

TO ORGANIZATIONAL OBJECTIVES AND STRUCTURE 9

ADVANTAGES AND DISADVANTAGES OF INTERRELATION 10

CRITICAL ANALYSIS OF VARIOUS BUSINESS STRUCTURES AND THE

INTERRELATION OF DIFFERENT ORGANIZATIONAL FUNCTIONS 10

CONCLUSION 11

POSITIVE AND NEGATIVE EFFECTS OF MACRO ENVIRONMENT 11

PESTLE ANALYSIS OF TOTAL PARCO Ltd 13

INTERNAL AND EXTERNAL ANALYSIS OF TOTAL 14

STRENGTH AND WEAKNESS INTERRELATE WITH MaCRO ENVIRONMENT 15

SWOT/TOWS ANALYSIS OF TOTAL PARCO 15

IMPACTS OF MICRO AND MACRO ENVIRONMENT ON BUSINESS 16

CONCLUSION 17

BIBLIOGRAPHY 18
 ASSIGNMENT: UNIT 01 BUSINESS AND BUSINESS ENVIRONMENT

Business Environmental Analysis:

Introduction:
The title 'business environment' indicates the superficial forces, aspects, and foundations that
affect a firm's ability to raise and sustain a fortunate customer correlation.
The factors involved are consumers, retailers, opponents, the state, etc.
It also includes all the legal, political, social, and industrial factors which are further examined in
this report.

LO1
P1. Different Types Of Organization:
Business Objectives:
A business purpose represents what makes a business distinctive and outlines the reason on
which the company is based.

1. The Profit Businesses

This thing can not be denied that profits are the lifeblood of any business. A businessman not
only gets a benefit of earning their living but it also allows them to reinvest to broaden their
activities.

2 . Non Profitable Businesses

Non-profit organizations exist to serve the community with a notable service. The word
'non-profit' quotes that this business has forbidden the distribution of profits among owners and
aims to be helpful for society.

3.NGO ( Non-Governmental Organization)

The NGO shares the basic theory that through grassroots organizing, the creative use of
information, and modern political strategies, individuals working together can do much to solve
human and environmental issues.

Types Of Organizations
In business, there are types of organization sorted by different types of ownership.

1. Private Sectors :
The private sectors are the ones owned by individuals. The profit advantages the owners,
investors, and shareowners.

2. Public Sectors:

The public sectors are the ones owned by the government. These organizations run on the
money raised by taxes. They aim to serve the community for its welfare.

Legal structures

1. Sole Proprietor:

The Sole proprietor also called sole tradership refers to a business wherein a single individual is
responsible for all activities, in simple words the single owner is personally responsible for
income tax.

2. Partnerships :

A Partnership can be defined as a legalized agreement between two or more than two
individuals or companies to share ownership as well as responsibility for any profits or losses.

3. Private limited :

A private limited company is a company that is privately held. The shares of a private limited
company are not issued for public subscriptions.
Organizational Size
Organizational size is referred to as the number of employees at any given geographical location.
An organizational strategy is a plan that specifies how your business will allocate resources.
According to research by Peter Blau, size is the most important condition affecting the structure
of an organization

Scope Of Operation

The term ''Scope'' points out the set of operations and requirements which are necessary to
conclude a task.
Properly defining the scope of a project allows managers to appraise costs and the time needed
to finish the project.

Key Stakeholders
Stakeholders can be defined as an individual or group having an interest in determination and
scheme in an organization. stakeholders are often impacted by the result of the project.
Some common examples include investors, partners, employees, creditors, communities, and
customers, etc.

P2 EXPLAIN THE SIZE AND SCOPE OF A RANGE OF

DIFFERENT TYPES OF ORGANISATIONS:

1.Pakistan State Oil (‫) قومی تیل پاکستان‬

Pakistan State oil is a Karachi-based largest oil marketing company in Pakistan. The
company was launched on December 30, 1976.

Pakistan State Oil Company Limited is a public limited company incorporated in Pakistan
and it can trade its shares publically. It is a for-profit business and is in the public sector.
PSO has over 3,000+ number of employees and is one of the largest organizations in
the country.
 2.Total Parco Pakistan Limited
TOTAL PARCO is a Karachi-based Pakistani oil marketing company, founded in the year
of 2002. The company is famous for marketing consumer petroleum products. It is a
for-profit business and is in the private sector.It is a public limited company and it can
trade their shares publically.
They have 22 employees across all of its locations and it is a joint venture company.

3.Oil and Gas Development Company Limited,

(‫ت گیس و تیل‬
ِ ‫ت محدود برائے ترقیا‬
ِ ‫)شرک‬
OGDCL is an Islamabad-based Pakistani oil and gas company, founded on 4 April, 1961. It is a
public limited company which works as a For-profit Organization. It is in the public sector.
The organization has a number of 11,000 employees and is the second largest company on the
basis of market capitalization in the state.

M1. Analyzing how structure, size, and scope of various types of

organization are linking with business objectives and the
products and services offered by organization:

According to the product and service, an organization sets their structure, size, and scope.Any
Organization sets the purpose of their business by reviewing their business scope.
On the other hand, the structure of an organization is a system for achieving and connecting the
activities that occur within a work organization. However, every organization has some common
objective that is serving customers and earns profit, but the profit level differs with the size.
 1. How structure, size and scope of PSO links with business objectives:

PSO is nation's largest energy company which is currently offering its services in marketing and
production of different POL products including Motor Gasoline (Mogas), High Speed Diesel
(HSD), Furnace Oil (FO), Jet Fuel (JP-1), Kerosene, CNG, LPG, Petrochemicals and Lubricants. One
of their objectives is to increase market leadership and strategize measures to improve the
bottom line. https://psopk.com

2. How structure, size and scope of TOTAL PARCO links with business objectives:

TOTAL PARCO is a fully integrated energy company. They offer services in refining, transporting
and marketing petroleum products like Oil, High Speed Diesel, Kerosene Oil, Petroleum
distillates.These products are highly significant in terms of their revenues. Their main motive is
to provide the nation with products in a safe, efficient, reliable and environmental manner.

3.How structure, size and scope of OGDCL links with business objectives:

OGDCL is engaged in the exploration and development of oil and gas resources. Their major
work is exploration, drilling, production, process, pipe Line, civil engineering works, joint
ventures, and training. The main products they sell are fuel and natural gas. The goal of this
organization is to increase the exploration and production domestically as well as internationally.

LO2
P3: Relationship between different organizational functions and
their linkage to organisational objectives and structure:

As the competition and risks have increased, different departmental roles have come up to help
companies to maintain their own suitable position.

Marketing:

They are one of the fundamental parts for any business operations to maintain a confident
relationship with their customers and other organizations. They also help the given organization
to deliver a strong brand image hence by carrying out an active participation relating to various
customer interactions using powerful tools and methods (Storey, 2016).

Finance:

They are also one of the fundamental departments that help the company to maintain its
expenses followed by legal requirements therefore to control the company's profit, they manage
the expenditures processes of the company.

HR:
They are also important departments as they carry effective and vital management of their
internal work processes thereby utilizing all the business resources. They are also engaged in
hiring the best workers to help companies in increasing their productivity and benefits.

Operations:

They help the organization by bringing out settled and efficient facilities so as to fulfil the
requirements and expectations of customers duly.

M2 Analyse the advantages and disadvantages of

interrelationships between organizational functions and the
impact that can have on organizational structure.

Advantages:

1. Working with other employees allows workers to learn new skills.

2. The staffers get a chance to stay for a long term by getting a promotion.
3. The team is managed by a skillful person so that they can review the entire work.
4. The managers are free to concentrate on strategies.

Disadvantages:

1.Employees from various teams do not get a chance to meet and share ideas and
perceptions.
2. An isolated group may face difficulty in communicating requirements and issues to new
functional groups which could help.
3.It may increase competition among different functional branches.
4. The employees having full information about operations may use that information to harm the
other branch.

D1 Provide a critical analysis of the complexities of different

types of business structures and the interrelationships of the
different organizational functions?
Different types of complexities are there in different types of different type of business
structures:

1. Complexity in Public sector organizations:

The rate of complexity is greater in public sectors compared to other sectors and is increasing
with time. One of the frequent complexities in public sector organizations is to satisfy the
stakeholders. Due to social media and networking sites, the demand of consumers is switching
commonly and for that reason satisfying customers is one of the big issues today.
Public sectors are facing many issues other than this.

2. Complexity in Private sector organizations:

Private sectors manage everything on their own. The main complexities in private sectors include
regulatory procedures and related delays which occur because of the government. The private
sector of the country often faces unnecessary control by the government, they face adequate
diversification , lack of finance and credit as small units often face problems in raising funds, low
ratio of profits and lack of management. ( Axelsson and Easton, 2016).

3. Complexity in Voluntary Organizations:

Voluntary organization works for social purposes instead of making profit.Raising funds and
increasing income is one of the biggest challenges for the sector as a whole. Also the major
complexity is internal control in this type of organization. Other than these, proper
documentation, risk management also are complexities in these organizations.

Conclusion:
This report discusses the different types and purposes of organisations such as public, private
and voluntary sectors and legal structures. Further, the size and scope of a range of different
types of organisations are discussed. At the end, it explains the relationship between different
organisational functions and how they link to organisational objectives and structure.

LO3
P4 Identify the positive and negative impacts the macro
environment has on business operations, supported by specific
examples.
Macro Environment:
The macro environment is composed of the external and irresistible factors that affect the
conduct, strategies and decision making of any organization nization for example PARCO Ltd :
Demographic Factors:
Demographic forces mainly involve human populations that favor business and
contribute to the economy, other demographic factors that must be analyzed include
age, gender, size, occupation, and need.
The business marketing depends on paying concentration on changes in demography. A
close thought also must be passed on to operation and mass production to assure that
the company is continually meeting its customer's needs.

Economic Factors:
The next thing to think about is the economic factors that affect the business
environment. In an economic environment largely two factors affect the business that
are demand and supply.If the demand is increased, the company will grow as well but if
the demand drops down then it may lead to some issues. (Schaltegger & Wagner, 2017).

Political Factors:
Businesses are always restricted by the political environment in which they exist. Laws
and governments regularly mould how a company can operate and even have sway over
the markets that companies can supply.( 2015 to 2021 CFI Education Inc.)

Socio-Cultural Factors:
Different societies and cultural groups are distinguished on the basis of different needs.
A business needs to be attentive toward socio-cultural deviation, especially when
moving into new markets to gain profit.

Technological Factors:
In order to survive in the present competitive market efficiently, Any business must be
able to update its technologies from time to time in order to satisfy the customer needs
otherwise the business can face a great loss in the market.

Environmental factors:
Natural forces can affect the business of TOTAL PARCO Ltd negatively as well as
positively. As population increases, excess to natural resources is also expanding which
may lead to the depletion of said resources. The expectation is to put less burden on the
environment in order to regenerate the ecological cycles.

M3 Apply appropriately the PESTLE model to support a

detailed analysis of the macro environment within an
organization.

PESTLE Analysis for TOTAL Pak Arab Refinery Limited

(PARCO):
Political factors:
The political environment helps in analysing the important government regulations.
Based on the statistics provided by TOTAL Pak Arab Refinery Limited ( PARCO) -
Management of circular case debt study, it seems that the country has a stable political
system.
In the matter of commercial and business commitments, the judicial system of the
country is independent on a grand scale. Other than this, factors affecting the business
include political firmness , tax and economic policy, employment laws and legislations
foreign trade etc.

Economic Factors:
Economic factors of a country and region have a direct impact on the potential
attractiveness of a given market. Some of the economic factors that have an impact on
PARCO limited are -fiscal and monetary policies, foreign exchange rate, price
fluctuations in both local and international markets, inflation rate, consumer Disposable
Income, workforce productivity and employment Rate etc.

Social-Culture Factors:
The socio-cultural factors also have immense influence on the economy of PARCO
limited. Different cultures in various parts of the world react differently towards
authority. In Asia authority is given respect while in the west it's opposite, TOTAL should
analyse its attitude towards authority before launching any marketing campaign for its
products.
Also, the higher levels of social concern in society often results in consumer activism,
pressure groups and pressure from non governmental businesses. Muntazar B. Ahmed
(2018)

Technological Factors:
Updated technological factors are useful in increasing the functioning in the production
of goods and services for the betterment of the organization. It also helps in increasing
complexity and cost.

Environmental Factors:
Environmental factors are helpful in the verification of the changes in the needs and
desires of the client. In order to maintain the good environment PARCO Ltd have leak
detection and emergency shutdown systems, corrosion protection, and microwave
towers for communication, SCADA system to avoid leakages, thefts and intermediate
storage tanks at 5 different pumping stations.
Other than that, the impact of refining on the environment is controlled by managing
emissions for example Low Nitrous Oxide burners and Sulfur removal from fuel gases.
The organization dedicatedly works to make sure that its products and fuels are
eco-friendly.

Legal Factors:
It is important to obey the codes of laws by the government as it helps in running of
operations in a smooth and well organized manner. It also helps in creating a good image
in the eyes of customers. On the other hand, it is time taking and expands the costs too.

Ethical Factors:
The organization of TOTAL Ltd believes in merit-based equal-opportunity policy for
recruitment and rejection of any individual, moderating the human values with its
policies, ensuring that all the stakeholders are provided equal opportunities, considering
the suppliers and service providers as business partners and treating them equally as
their employees.
Further the organization also believes in the value of self-examination and transparency.

LO4
P5 Conduct an internal and external analysis of specific
organizations in order to identify strengths and
weaknesses.
Internal and external analysis of TOTAL Lts in order to identify strengths and weaknesses:

1. Competitors assist organizations to obtain a combative advantage for the

organization. This is added in strength for organization. (Sarda, et.al. 2013)
2.Total provides top quality products that fulfills the necessities of customers and in
addition to it creates a good image of the company.
3.It provides the customers with good quality of chemicals, coal and power generation
which is also a strength of organization.
4. The products that the company sells are of good quality so the clients suggest buying
from TOTAL which is also a strength.
 P6 Strength and Weakness Interrelate with External Macro
factor.

Strengths and weaknesses are interconnected with external macro factors as in certain
situations, organizations are affected by macroeconomic factors. The organization gets
affected due to the fact that it is not a simple task to spot the obstacles that affect the
accountability of an organization directly or indirectly. Strength and weakness are two
contradictory factors that provide the organization with potency as well as weakness.
Proper inspection of these two factors can help the organization to achieve a balance in
the organization, these two factors may add the risk of external macro factors.
SWOT/TOWS analysis is the perfect method that helps in identifying the strength,
weakness, opportunities and threats of an organization. It also helps to identify the
opportunities and the threats that may affect the organization for example the political
issues are threats. There are both positive and negative impacts of social factors on
organization. Society business can not be possible without positive factors while the
negative factors are the ones which an organization has to bear for a society which is
called corporate social responsibility. There are many other problems like technological,
legal or ethical but they also act as opportunities (Na & Lee, 2017).

SWOT analysis helps to assess the external factors and to find the acceptable alternative
to overcome the complications. External factors include competitors' policy, legal rules,
market changes, government policy, etc.

M4 Apply appropriately SWOT/TOWS analysis and

justify how they influence decision-making.

SWOT analysis of TOTAL PARCO Ltd are as follows: (MBA Skool.com, 2020 )

Strengths:

1. Total is one of the greatest oil and gas companies in the country.
2. It has great global reach and a strong trade name.
3. It has divergent operations in chemicals, coal, and power generation.
4. Entering the nuclear energy sector.
5. Other strengths of the organization are crude oil and product trading.
Weaknesses:

1. The weaknesses includes legal issues

2. Employee management.
3. The organization has also faced some oil spill controversies.
4. The company has also been involved in forged investments and bribery cases.

Opportunities:

1. The opportunities of the company include increasing oil and fuel cost.
2. It also includes an increasing natural gas market.
3. The organization can work on more oil well discoveries.
4. The company should look forward to expanding the export market.

Threats:

1. The threats to the company are government regulations

2. As time is passing by, the competition is also increasing.
3. On the other hand, Hybrid cars are replacing patrol and diesel cars.

D2- Impact of Micro and Macro factors on business

objectives and decision making.
The micro environment is the environment that can affect directly and particularly on
the business. It includes customers, competitors, resellers, suppliers and the public.

Customers: The factors that depend on customers are stability of demand, prospects of
sales growth, relative profitability and the intensity of competition. (Mage Plaza #)

Suppliers: The suppliers are highly important factors as they are a key link in the value
delivery process, they ensure that your business has the necesarry resources and they
are important determinants in case of price increase or decrease.

Resellers: As a connection between the company and customers, resellers are important
in terms of promotion, distribution, sale, marketing and financial mediation.

Competitors: Competitors are the one who sell the same product but with different
tactics so it is important for an organization to keep an eye on all the marketing tactics in
order to gain priority over other companies.

The General Public:

The public’s perspective is important as it is the one that either pouches you towards the
success or leads you out of the market. The public is essential in terms of opinions,
media and environmental pollution.

The macro environment is the one that has effects on business operations and decision
making of a company. It comprises external factors which are not in control of the
organization itself. Macro-environment consists of economic factors, demographic
forces, technological factors, natural and physical forces, political and legal forces, and
social and cultural forces.

The economic factors affect mainly two aspects of the business environment, first the
production level of the company and the decision making process (Mage Plaza, 2021).

The technological factors depend on skills and ability that is applied on production,
materials as well as technology which is required in the process of making of products.
The technological factors include automation, internet connectivity, engine performance
and efficiency etc.

The development of the market depends upon the legal and political environment in
different areas. The political factors commonly include copyright law, fraud law,
descrimination law, employment law, safety and health law, and transportation law etc.

Society is the chief priority for any business environment as the growth and survivorship
of an organization depend on society.

SWOT Analysis ( strength, weakness, opportunities, threats) is the best way to analyse
the micro and macro environment. It particularly focuses on how organizations like PSO,
TOTAL PARCO and OGDCL can form acceptable competitive improvement within an
organization

Hence, Both micro and macro factors have a strong impact on the success of any
business and are required to be considered in the decision making process.

Conclusion:
Starting a business has become hardened with time due to governmental policies, rules
and regulation, and political problems, But the facts that help an individual in doing
business are social media, technology and global approach. This report presents the
PESTLE analysis of organization to estimate the external factors. Apart from it, SWOT
analysis makes it easy to understand the threats and weaknesses of an organization,
which an organization can use to overcome the business problems and also to increase
the profits.
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