Beijing International Vocational Education School by HC121103185645


									       Beijing International Vocational Education School

                            BTEC Higher National Diploma

                           Assignment Cover Sheet

Name(s) of Student
Intake/Class                  2009/

Course Title                  BTEC Higher National Diploma in Business (Management)

Unit Title                    Unit 1 – Business Environment (L4)

Assignment Title              Assignment 1 (Individual) – Organization and Its Environment

Assessor                      Henko Janse van Rensburg / Lina Liang

Date of Issue                 20 March 2012

Date of Submission            27 April 2012

I/We hereby confirm that this assignment is my/our own work and is not copied or plagiarized from
any source. I/We have referenced the sources from which information is obtained by me/us for this

Signature(s) and date (s) __________________________________________________

Student(s) Comments:
“√’ if this is a re-work ___
 Learning Outcome        Evidence for the      Evidence/Feedback   Assessor’s
                             criteria                               decision

                            Identify the
                            purposes of
                         different types of

   Understand the          Describe the
   organizational       extent to which an
     purposes of        organization meets
     businesses          the objectives of
    (Unit 1, L01)            different

                            Explain the
                         responsibilities of
                        an organization and
                         employed to meet

                           Explain how
                        economic systems
                        attempt to allocate                        2.1

                        Access the impact
Understand the nature      of fiscal and
   of the national       monetary policy
environment in which        on business
  business operate      organizations and
    (Unit 1, L02)         their activities

                        Evaluate the impact
                          of competition
                         policy and other
                        mechanisms on the
                          activities of a
Assessor’s additional feedback and comments (attached additional sheets if required)

Grades Awarded

Pass (Tick √)             Merit and Distinction Descriptors Awarded (State M1, M2, M3, D1, D2, D3)

Signature of Assessor                                                       Date

Signature of Learner(s)                                                     Date
When Oral Feedback Is Given

Internal Verification (IV)

Agree with grades awarded by Assessor. Please tick ‘√’ ____
or New Grade(s) if Internal Verifier (IV) does not agree with grades given by Assessor.

Additional Comments (Mandatory if IV does not agree with grades given by Assessor)

Signature                                    Name                             Date
1.0Introduction ........................................................................................................................... 1
2.0 The purpose of different organizations ................................................................................ 1
3.0 Stakeholders analysis ........................................................................................................... 2
4.0 Responsibilities of organizations and strategies employed ................................................. 4
5.0 Economic systems and resources allocation and usage ....................................................... 6
6.0 Fiscal and monetary policy .................................................................................................. 8
7.0 Competition policy and other regulatory mechanisms ........................................................ 9
8.0 Conclusion ......................................................................................................................... 10
References ................................................................................................................................ 11

List of Figure:
Figure 1 Stakeholder Mapping…………………………. …………………………. …….……………6
Figure 2 Adidas Products………………………………………………………………….……………7
Business Environment focuses on the impact of different environment and policy on
organizations and the influence of their performance and profits.

There are six aspects will be identify in this assignment, it includes the purpose of different
types of organizations, the responsibilities of an organization meets the objectives of different
Stakeholders and the responsibilities of organizations &strategy employed to meet them, how
economic systems attempt to allocate resources effectively, the impact of fiscal and monetary
policy on business organization and their activities and the impact of competition policy and
other regulatory mechanisms on the activities of a selected organization.

2.0 The purpose of different organizations
Organization is born by two or more people get together and agree to coordinate their
activities in order to achieve their common goals. According to their different nature,
different leader and different sense of organizing intentions, organization can be divided in
two types, one is non-for-profit, and the other is for-profit organization.

For non-for-profit organization, For example, International Committee of the Red Cross is an
aid organization in world. It contains 31 provinces and 265.8 million members in China; their
objective is helping poor people or patient. When they obtain money or goods from solicitor,
they will send them to some place where needs help.

The for-profit organization can be split into two types, private enterprise and state-owned.
Kraft is the world’s second largest company and their product in sales in 150 countries. For
Kraft the profit purpose is gaining more profits, increasing market share and having a long-
term development. If they achieve their ideal profits, they will expand their international
marketing, vigorously develop new products, or raise pay for employees. Then, Bank of
China is state-owned enterprise; it assumes financial service, insurance service and foreign
exchange business. State-owned company’s goal is not profit; it should take the lead in
economic growth and provide a basic economic for people. Sometimes, bank should help
country and government to ease financial pressures.

In conclusion, because of different nature of organization, they have different objectives and
when they achieve their objectives they will set some more long goals.

3.0 Stakeholders analysis
Adidas is a German sporting goods manufacturer and it’s a member of Adidas AG. This
company also produces sporting goods, perfumes and skin care product. Adidas not only
includes sub-brand called Adidas Originals but also has event Sponsorship, such as Olympic
Games and football match. Following is the analysis about how Adidas achieves the
objectives of different stakeholders.

The stakeholders of Adidas limited company can be divided into three types, internal
stakeholder, connected stakeholder and external stakeholder. Stakeholder group probably
contains shareholder, Customers, suppliers, legal entity and internal employees etc.

Internal stakeholders contain managers and employees. For employees work in Adidas, they
hope their enterprise has good working environment which is comfortable and clean, so that
they will focus on working. A career development is important for employees; they don’t
want to work in the same position from time to time, a salesman may hope to be a store
manager, so company should give them promotion prospect. Job security is necessary,
workers would have considerable income and insurance is a basic guarantee. Some workers
are making shoes, thus the material of shoes are non-toxic. Internal stakeholders like a family
and company is that their home, so the most important expectation that is the organization has
a continuous growth.

Connected stakeholders’ prime expectation is obtaining desired interest. Suppliers are
connected stakeholders, they provide raw material for Adidas, and suppliers hope to establish
a long and friendly cooperation relation with the company, then they will get stable income.

External stakeholder is government, the government expects Adidas have a lawful operation,
a good brand image in local and Adidas can meet their objectives. For example, Adidas
should protect the environment or support government’s activities.

                                Figure 1 Stakeholder Mapping

According to the stakeholder mapping, assuming there is a new strategy decision about
propagandizing new clothes. Adidas should give stakeholders who belong to area A the
minimal attention. Due to they have the least benefit-based relationships and the least power
to make decision, so Adidas need not to give them special focus.

In area D, people who have higher interest and lower influence, such as cooperative clubs.
Adidas would keep connection with these clubs. Because they can make indirect advertising
and financial support, Adidas will give them attention frequently. Managers of Adidas also
visit cooperative clubs or when they want to make a new advertisement for clothes, they will
invest these clubs.

Part C is containing legal entity, When Adidas promotion activities to launch their new
clothes, they have right to suspend these activities, company will keep them satisfied, so that
legal entity can support the strategy. Legal entity want to company abides their laws, so
Adidas depends their regulations to operate their company.

Key players in part B, For Adidas, they mainly sales new clothes, the customers group is
younger people and trendsetters and they have absolute power Adidas must satisfy what they
want or need, whether this strategy is successful or not, thus company produce different
styles and color clothes. If customers against, Adidas will be in stagnant.

Stakeholders are satisfied with Adidas limited company. Four points will be used to analyze.
In the aspect of effectiveness, Adidas occupies the market share in second place in China, and
increases 28% [Adidas in greater China director general manager: we play products series
finale]. If the new strategy meets stakeholders’ needs, their market share would be
continuously increased. After that, the new products will be update per three mouths, and
surplus product will sale in outlet, the productivity has been rising when the new clothes
introduced. Also some fashion series were launched in 2011, the price of Adidas fashion
shoes is thousands Yuan, a large number of stars bought them, so it increases can profits,
stakeholders are satisfied with this situation. The part of elegance, now, a new series product,
Adidas Originals has a special logo--72, it means Adidas Original established in 1972.

                                   Figure 2 Adidas Products

From the above analysis, Adidas are achieving the objectives of different stakeholders and
their key performance indicator meets stakeholders’ expectations. Due to all the stakeholder
support this strategy, Adidas culture are successful.

4.0 Responsibilities of organizations and strategies employed
Coca Cola Company is the biggest drinking company which found in 1892, they provide 500
brands in 200 countries. Their products include juice, carbonated water and coffee etc [Coca-

Corporate social responsibility (CSR) is a form of corporate self-regulation integrated into
a business model [Corporate social responsibility]. Every organization also has these three
types of responsibility Coca Cola has three kinds of social responsibilities which are
environmental responsibility, ethical responsibility and management responsibility.

Environmental responsibility: the most common package for carbonated water is plastic
bottle; this factor may cause land and water pollution. Although everybody know that plastic
bottle can be recycled, if a person drinks Coke on the street, he may not bring it home,
throwing it on grass or on streets, after a long time, there are a lot of plastic bottle
everywhere, it can lead to land pollution. On the other hand, for some TV show, presenters
teach audiences to use Coke to clean the toilet, because carbonated water has acidity, which
can broke dirt, When Coca Cola company produce carbonated water, surplus materials will
contaminate the water. In 2009, Coca Cola Company has been already entering China water
pollution list (Coca-Cola and Pepsi has already enter the water pollution on the list on China
[Coca-Cola and Pepsi has already entered the water pollution on the list on China].

Coca Cola Company would abide by Legislation and regulations to process emissions, and
make activities to promote environmental protection. The water made by Coca Cola
Company always has a logo; it is a environmental protection logo. A person throws the bottle
into dustbin. Coca Cola want to make customers have environmental awareness, so that they
can avoid a certain amount of pollution, such as bottle in grass. When customers drink Coke,
they would see this logo, and they perhaps throw it into dustbin.

Ethical responsibility: first, managers should protect their employees and public; make sure
to abide by Consumer Protection Act 1987. Managers must take their workers far away from
dangerous working conditions and harmful materials, such as carbon dioxide. The whole
company refuse every illegitimate and wrongfulness behavior, such as extortion, bribery and
gifts. From CEOs to employees, from internal to external, each member takes proper way to
work and chat. Then, deal with competitors, Coca Cola Company’s major competitor is
PepsiCo, they cannot use the way of stealing information or unfair price to maliciously

From the start, leaders should inculcate concept of good morality education and value, and
lead employees follow their correct thinking to work. When staffs are in probation period,
Coca Cola’s managers should train them and teach them that they cannot use sharp practice
to achieve their aim. For internal organization, staffs have peace and fair competition and
external organization gets a long with competitors, such as, Coca Cola does not using
advertisements to attack counterparts.

Management responsibility: Coca Cola has responsibilities to stakeholders.

Customers: Company should as far as possible to satisfy the quality and service which
requested by customers, make reasonable price with specific products, then deal with every
customer honestly and fairly. Their water’s price also about 3 Yuan, it is a public price that
customers can accept, in order to meet customer’s needs, Coca Cola Company introduce with
water different taste into market.

If company wants to take responsibility for customers, first they should have fair trading,
Coca Cola cannot only provide products in certain area or when they have a new product they
increase the price or set a very low price, so that other company cannot operate.

Employees: Coca Cola gives employees reasonable pay and safety working condition, giving
different staffs different level and types of training so that they can work more better and self
confident, they depend on recruitment policy to find professional staffs and operational staffs
in order to make sure they can be qualified for this position.

Company would make legal contract with employees and abide by healthy and safety
regulations, it is important for employees have a fair treatment, Coca Cola should avoid
discrimination, such as sex discrimination, the company employs staffs by examination
instead of refusing to use men or women or in order to make profit, they only use people who
live in Southeast Asia.

According to above analysis, Coca Cola has already had enough responsibility for
environment ethical and stakeholders, they also make new decision or strategy to update the
methods they used.

5.0 Economic systems and resources allocation and usage
In this report how to allocate and use resources in planned economy and market economy of
China before and after opening is discussed in detail.

The feature of resources is finiteness, every organization and every person wish to use
resources freely. So the demand is infinite. There is certain number of resources in a country,

but people want to get more and more. Because of this, people wonder to find a reasonable
economic system to achieve optimal allocation of resources.

Planned Economy
From 1964 to 1978, Chinese government uses planned economy to distribute resources,
planned economy is the central government totally control over the allocation of resources.
Government makes decision on what is produced and how to produce [The Establishment
and Development of Chinese Economic Legal System in the Past 60 Years]. Companies and
people don’t have autonomous right about what they want. Production volume, projected
workload has already been calculated by people who work in government. Under the control
of the government, enterprises haven’t got motivation. If companies accord to government
index to produce, there was no competition in every industry, the production efficiency can't
be improved, so enterprises development is limited.

Personal demand differentiation cannot be reflected because government allots resources
equally. When people buy foods and daily necessities, they must use several of coupons; they
cannot buy beautiful clothes or eat gourmet food. The most unfavorable influence is wasting
resources, government doesn’t know the situation of every industry, they only depend on
research to calculate, for example, a company may need a ton iron to product bike, but
government provide them three tons for it. It will lead to the wastage of resources, so planed
economy is not very efficiency in resources allocation.

Market Economy
After 1978, government uses market economy to allot resource. Market economy is
companies have autonomous right, government only gives a few interventions. Corporations
just produce goods accord to the market-orientation and customer-orientation. Company
pricing product and plan volume of production. When companies have motivation,
competitive is appeared. Resources can be effectively allotted depends on demand

Personal demand differentiation can be reflected. Because they need more and more, so
working motivation can be inspired, company also will get benefits. Market economy may
lead to malicious competition and monopoly problem. For example, in order to make more
profits, a company will buy more or all the resources will be produced, the market would be

out of control. So compared with planned economy system, market economy has more
advantages, but also there are some disadvantages which has been discussed above.

Therefore, no matter what kind of economic system adopted by China, the purpose is always
to look for a reasonable system to achieve the optimal allocation of resources.

6.0 Fiscal and monetary policy
Government’s fiscal and monetary policy will make impact on an organization’s operation..
Fiscal and monetary policy is two tools that government adjusts macro-economy. fiscal
policy is the use of government expenditure and revenue collection to influence the economy
[Fiscal Policy]. Monetary policy is the process by which the monetary authority of a country
controls the supply of money. Its aim to prevent inflation and stabilize prices, promote full
employment increase, economic growth and balance international payments, etc.

As for Fiscal policy, taxation and government spending are used to regulate economy. There
is an example about effort of government taxation on enterprise, in order to encourage
development of small-size enterprises, government decided to raise corporation tax. This
fiscal policy will has impact on enterprise’s operation and economy. When corporation tax
threshold is raised, companies’ incomes will be increased. Then, company will have more
capital to purchase, invest and expand scale. Although this fiscal policy can promote
enterprises’ development, it also causes inflation. For example, if employees earn more
income, the desire of consumption and demand always increased, and then it makes
production quantity goes up. The same product may be of different price now, inflation

Monetary policy
Chinese government has allowed Yuan (RMB) to appreciate by almost 30% since 2007, from
RMB 8.3 to RMB 6.3. This policy will make benefits for Import Corporations. When
company purchases products from foreign company, the price will be low. However, due to
export corporations, they would be influenced by this policy. For instance, before 2007, when
one clothe was sold to America, they could get RMB 83 Yuan, now, they only can get RMB
6.3 Yuan. The impact is that the unemployed rate will be increased, because foreign company

will find the cheaper labor in Southeast Asia, due to labor of Chinese is more expensive,
Chinese workers will lose job and the employment rate will increase.

In conclusion, government can use both fiscal and monetary policy reasonably adjust Chinese

7.0 Competition policy and other regulatory mechanisms
Industrial policy is that government makes effort to encourage the development and growth
of the manufacturing sector of the economy [Industrial Policy]. It includes industry structure
policy, industry organization policy and industry technology policy. Industrial can promote
organization’s development, it also limit company operation.

Shougang group mainly produce steel industry, it originally sets up planets in Shijingshan
District. In order to save Beijing air quality and ensure the Green Olympics, the State Council
decides to make Shougang Group moving to Caofeidian. This green belt policy prevents the
development of Shougang Group. The State Council estimates that uses five years to move
the Shougang Group, government hopes that Shougang Group can move to Caofeidian before
the 2008 Olympic Games. If this objective cannot be achieved, during 2008 Olympic Games,
they should shut down production lines [Shougang move: recover the blue sky of life and
death choice]. They need to pay RMB25 billion removal expenses [Attention on shougang
move]. The most important problem is the reallocate of employees, these will consume more
capital for Shougang. In the five years, Shougang may remain stagnant.

Social Warfare Policy is the study of social services and the welfare state (Social Policy). In
general terms, social welfare policy is a part of social policy, it has relationship with politics
and society. Now, Chinese social warfare policy is improving and competing. Environmental
policy is aiming for protect Chinese environment, government is using protection strategy in
order to solve a certain period of environmental problems.

Shougang also is a good example of Social Warfare Policy, when Shougang moves to
Caofeidian, government will pay a half of capital for them and government also help them to
solve problem of reallocating employees. This policy will ease the pressure of enterprise and

In conclusion, industrial and social welfare policy can help an organization to have long-term
develop and support enterprise and staff have more warfare, however it will take drawbacks
for them as well.

8.0 Conclusion
This paper has successfully demonstrated that understand the organizational purposes of
businesses and the nature of the national environment in which businesses operate.

This paper has defined different types of organizations, the responsibilities of an organization
for different stakeholders and the responsibilities of organizations &strategy employed, and
studied the methods of allocating resources effectively, the influence of fiscal and monetary
policy and competition policy on selected organization.


Coca-Cola and Pepsi has already entered the water pollution on the list on China
[Online] available from
[Accessed 16 March 2012, 09:00]

Corporate social responsibility
[Online] available from
[Accessed 16 March 2012, 09:00]

Adidas in greater China director general manager: we play products series finale
[Online] available from
[Accessed 15 March 2012, 18:00]

[Online] available from
[Accessed 15 March 2012, 11:00]

Shougang move: recover the blue sky of life and death choice,
[Online] available from
[Accessed 13April 2012, 21:00]

Social Policy
[Online] available from
[Accessed 13 April 2012, 21:00]

Attention on shougang move
[Online] available from
[Accessed 20 April 2012, 14:00]

Fiscal Policy
[Online] available from
[Accessed 23April 2012, 19:00]

Industrial Policy
[Online] available from
[Accessed 1April 2012, 10:00]

The Establishment and Development of Chinese Economic Legal System in the Past 60 Years
[Online] available from
[Accessed 10 April 2012, 10:00]


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