Analysis of Business environment and plans

Every company operates in an environment where there are stakeholders and factors affecting businesses. For any company to succeed proper environmental, economical, social, technological and legal must be analysed. Also the analysis of the stakeholders and their impact to the success of the company is necessary. In this report am analysing constitution UK plc a public company in the U.K. When I was carrying out this analysis I considered the changes in the strategic plans of the company and strengths, weaknesses, opportunities and threats for the company.

Constitution UK plc is incorporated in the United Kingdom. All political decision in Europe affects the company and I am going to use PESTLE of SPECTACLE model in analysing the business environment of constitution UK plc. The company operates in an environment where labour laws are observed to the letter and the economy is fairly stable. Stakeholders also play a very important role in the success of a company. Therefore any company should strive to analyse the importance of any stakeholder and their usefulness in policy making of the company.

In analysing business environment I will start by analysing political environment, economical environment, social environment, technological changes environment, legal environment and the natural environment itself.

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Political

Recently, there was change of guard in the political scene in the United Kingdom. Tony Blair left power and somebody else took over. The change of guard in the United Kingdom did not affect business environment very much although the company felt a little positive change. The current environment for business in the UK is very supportive to the type of product the company is offering.

Economic

Economical environment involves how the company performs financially and what the financial strength of the company. Constitution UK plc has a fairly stable financial base and they can acquire any subsidiary in any country or county with easy. The company performed very well in terms of sales and the profits were very good and they have a very good name with Banks meaning that they are able to secure credit without much hustle. The company has a small debenture issued to the public with an interest rate, which is small. The founders of the company are ready to inject more capital in terms of rights issue or another public offer.

Social

Social environment entails the analysis of the social events that affect the company and how it changes. The company has a good social responsibility i.e. through sponsorship of local football clubs meaning that the company is attracting the local with its products. The company is situated in an area where the neighbourhood is full of well-known economic sabotage’s. For the company to derive well in the same environment they have assist the community in putting up a security unit in the area.

Technological

Technological analysis involves the analysis of the company’s ability to move with changes in the technological changes. The company has computerised all its operations and have taken their employees for training in the use of computers. All production is computerised and it is easier for the managing director at the head office to monitor the operations from his office because the company has networked all its systems. The company has also put in place security systems, which are computerised, and any person visiting the company is screened and Television circuits, which are strategically placed in the company’s premises, monitor his movements.

Legal

Legal analysis analyses the ability of the company to cope with the existing legal position, and the new rules. Constitution UK plc is able to comply with the UK rules i.e. the Income Tax rules, employment rules, international labour organization rules, trade union rules and the internal rules set aside. The company recently dismissed an employee on the grounds of misconduct where proper procedure was followed. However, the employee decided to go to court citing improper termination of employment and the company represented this case in court very well which they succeeded. The company’s lawyer is a well know person in the legal fraternity therefore is well represented.

Environment

The company is operating in an environment, which is already polluted; therefore it is the responsibility of the company to ensure that does not produce pollution agents. The company also does not use plastic bags but plastic containers to damp their garbage, which is collected twice per day. The dirty water from the industry is passed through a cleaning channel before been released to the outside environment. The smoke from the chimneys of the company is already subjected to chemical purification for avoid a scenario a social fight with pressure groups of environment. The company has entered into a memorandum of understanding with one of the environmental pressure groups for the exchange programs.

Stakeholders

Stakeholder is any person, organisation or society that is affected by the business or the environment the business operates in. They may be having direct or indirect interest in the business of the company where they may get in contact with the company regularly or on occasional basis. Stakeholders may include shareholders, management, employees, banks, mortgage firms, government, trade unions and pressure groups.

Shareholders

Shareholders are the owners of the company and they are interested in the profits of the company. Their reward is always dividends, capital growth and social responsibilities. For the company like Constitution UK plc has very good profits and has been paying good dividends to their shareholders and it is attracting more people willing to be shareholders of the company. This company is enjoying good growth. The shareholders if they start sharing their shares, the company may loose value; therefore a good dividend policy is very important.

The management and employees

The management and employees are May shareholders or just employed. These are the people who participate in the day to day running of the company. Their service is very important to the customers and to other stakeholders. The employees of this company are interested in the good pay, promotion, job security and prospects of the company. The employees will start leaving the company if it is rumoured to have a bad financial position.

Customers

Customers are the people who buy products from the company. The prices offered by the company attract customers. Apart from the price the customer also will the interested in the success of the company since he has been using the products of the company for a long period and he is still using them. The customers will also want to have a safe product for their use and the company I am observing has acceptable good product that has been approved by the government authorities.

Suppliers

Suppliers of the company are those people who offer services and goods to the company. They will be interested with the financial success of the company because the will want to have regular business with the company and major those who are offering credit services to the company would wish to see their money being paid back. No supplier will supply to a company that has poor financial position and bad credit worthiness. The company has strong financial position and has created good name with their customers.

Local Community

The Local community is interested in the success of the company since they are the providers of labour to the company. Constitution UK plc has employed 1,500 employees who are members of the community where they are operating in. The local community is also interested in the reduction of pollution, which the company has decided to use non-fossil fuels which does not affect the environment. They have also decided to use plastic containers for the damping of garbage and not plastic bags. They have also taken up to themselves to sponsor a local club which is participation in a national league.

The Government

A government is the governing authority in any country, which ensures that the citizens are getting social services and goods, and ensures there is rule of law. The government is interested in the business of Constitution UK plc because of the employment policy the government want to be implemented, the inland tax revenue, excise and customs taxes and social responsibility of the company. The government of the United Kingdom is interested in the business of Constitution UK plc because the company is in a good position and it contributes to the revenues of the country and it employs citizens of the United Kingdom. Recently the company employed an employ who has a forged passport to the United Kingdom from Somalia and a forged working permit. When the company was making returns this normality was discovered.

Trade Unions

Trade unions are representatives of employees’ interests. They are interested in the success of the company because if the company is doing poorly financially the company will not be able to pay its workers. Therefore the union ensures their interests are represented in decision making of the company. They ensure there is minimum wage policy implementation.

Banks and other financial institutions

These are institutions that give credit facilities to the company and they also help the company in investing the excess funds. Since they are the providers of the funds, they are interested in a strong position in the financial segment of the company. In the case of Constitution UK plc has good relation with their bankers and credit providers.

Pressure groups

These are groups that are interested in the business action. They may include environmentalists, lawyers, accountants and other bodies that oversee proper usage of the company resources.

Conclusions

The stakeholders and environmental factors are very influential in the success of the business. Stakeholders always put their interests first and they want them to be fulfilled. Without the satisfaction of their interest the company cannot succeed. The shareholders must know whether they will get an investment return for their continual investment in the company, employees will also be interested in a good pay and promotion. Banks and other financial institutions will also look on how well the company pays their loans and how the financial statements are reading.

Customers are interested in a good and safe product at a good price so that they will continual patronising the company. In overall they cannot patronise the product of the company if there is not taken care of. The government is interested in the taxes they receive from the company.

In overall the company will succeed if it carries out proper business analysis in terms of political, economical, social, technological, legal and environmental. Without proper analysis the company will be destined for destruction.

References

1. U.K Plc Website.
2. D. Hitchcock; Environment and Business; Routledge, 2001
3. C. Anderson, D. Miles; Business Management
4. Slack And Lewis, M. Lewis; Operations Management; Routledge, 2002
5. Monir Tayeh; The Global Business Environment; Mc GrawHill, 2002
6. Michael L, Understanding Business;Environment; Routledge, 2000
7. U.K Plc  Website
8. D. Hitchcock; Environment and Business; Routledge, 2001
9. Michael L, Understanding Business;Environment; Routledge, 2000
10. Monir Tayeh; The Global Business Environment; Mc GrawHill, 2002
11. C. Anderson, D. Miles; Business Management
12. Slack And Lewis, M. Lewis; Operations Management; Routledge, 2002

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