Business Report: Xero

Executive Summary

The report aims to focus on the analysis of Xero, a company with the business to produce and distribute the business software and support the innovation and small business start-up throughout the globe. The study is to focus on the development of the organization through the general environmental analysis using the tool PESTEL analysis. Through the analysis of the general environment of the company, a special focus is laid on the economic stability of the organization. The company's annual report is analyzing the current growth of the organization. The social responsibility of the organization is also focused on the study to analyze the role of the organization in contributing to social development and social progress. The analysis of the corporate social responsibility of the organization helps to formulate the idea regarding ten sustainability and innovation of the company. The report is to reflect on the leadership of the organization. It also examines the growth and expertise received during the project. The experience that I received will also be reflected clearly in the organization.

Table of Contents

Introduction.

Task 1 (A1.3.1): General Environment

Economic trends.

Task 2 (A1.3.2): company’s environment

Customer analysis.

Task 3(A1.3.3): social responsibility.

Analysis.

Environmental sustainability.

Community initiatives.

Evaluation.

1.3.4: managerial: identification.

Leadership.

Experience relevance.

Conclusion.

Reference List

Introduction

The business report aims to focus on the understanding of the business environment analysis of Xero. The business analysis helps to estimate the trend of the company. The report also analyzes the general business environment. The study is to focus on specific environmental analysis. It is also to evaluate the impact of the customer on the business environment of the company. Social responsibility of the organization and the concept is to be applied to the considered organization. The study is to reflect on the understanding of the concepts of theoretical management and learning experience received from the previous assignments. The report is to focus on the possibility of future growth of the organization from the current environment analysis.

Task 1 (A1.3.1): General Environment

The environment of the organization incorporates the factors that affect its business and growth potential (Genua et al. 2011 p-40). The general environment has a greater influence on the success level of an organization. It helps to track the events and trends.

PESTEL analysis is known to be an important tool for analysis of general environment analysis, and it also helps to analyze the impact of the general environment on the organization. PESTEL consists of political, economic, social, technological, and environmental and legal aspects of the organization (Bhattacharya, 2011, p-581). It helps to analyze the opportunity and threats which helps to formulate the firm's strategy.

Political

New Zealand Political system is stable enough to provide developmental possibilities. New Zealand maintains a low corruption level in the world ranking. Trade and tariff rules in the IT industry are medium level. Pricing regulation changes over time and it causes an impact on the company. Wages legislation continues to change labor market taxation.

Economic

New Zealand is a country with a stable economic system. There is a free trading system in the country. The organization takes a great opportunity to trade in the country. Fluctuation in the exchange rate affects the market and the organization immensely. In New Zealand, the education level is well, and therefore it provides a good labor market. The economic growth rate and GDP of the country are flowing well. New Zealand is moving with 2.8% of annual growth and it is an economy of 41.945 million per capita. Therefore, it provides a good environment for the company. It provides a convenient environment for the development of the company.

Social

The New Zealand population has good demography and skill. in the organization, the division of class hierarchy and structure of power is well defined. The employee at the organization maintained a standard level of the organization (Jurevicius 2020). Consciousness reading hearth and consciousness are enough. Therefore, social factors provide a better opportunity for Xero to grow and flourish.

Technological

Technology is important to manage the supply chain and warehouse management in the industry. It helps the company in the product's promotion and product's marketing and e-commerce activities. The growth rate of technology is the organization is found to be satisfactory. The sector employee-specific software to manage the supply chain.

Environmental

Climate change is an issue, but the industry does not affect the climate in any way. The industry has to recycle the possibility of old clothes. The environmental factor does not affect the company.

Legal

Various laws may obstruct the company’s operation such as employment law, data protection law, consumer protection, and e-commerce law. 

Economic trends

The economic slowdown in the United States and China has affected other countries including New Zealand (Genua et al. 2011 p-41). The impact of economic slowdown on the Xero is inevitable (Veghte 2020). The expected GDP growth is thought to be 3.0% annually, but it is difficult to retain the position at this moment. The company Xero has not been deeply affected due to the economic slow (Parker 2016 p-2019). The revenue generation is continued to depict the property in the IT sector. If there would have an economic boom, the company would have performed better.

Task 2 (A1.3.2): Company’s Environment

Theoretically, the company focuses on the profit maximization theory. The company manages the general environment of the organization to deal with profit maximization theory. the company remained undisturbed with the political instability of Australia as its growth continue to be the same as the IT sector remained at the height of excellent growth (Chen et al. 2018, p-301). The company follows its sustainable profit maximization process. The Company registered a growth of 17% in 2019 from the revenue of 2018 in New Zealand. In Australia, the company also depicted a significant growth of 25% in revenue generation (Veghte 2020).

The company managed labor specialization with the demographics and highly developed skills of labor. The industry requires highly developed skill labor (Genua et al. 2011 p-42). New Zealand balances the IT industry workforce with the import of skilled workers from abroad. The growth of technology in Australia has posed a challenge to the company as there are many emerging organizations involving similar kinds of IT services. The potential growth in IT worlds affects the company widely (Veghte 2020).

The social structure within the organization is free from all kinds of discrimination. There is a significant hierarchy within the organization (Veghte 2020). The organization maintains social order and values the culture and ethics and maintains man and women ration within the organization.

As the company is completely an IT-based company, environmental laws do not affect the company. The company focuses on paperless work, and it does not require the recycling of papers (Schaeffer 2008).

The weaker exchange rate of NZD against USD in March 2019 in comparison to march 2018, there is a deep impact on the AMRR growth in the segment if international operation. In a stable currency, it is found that there is a growth of 32%. The operating revenue of the company became 552,814,000 in 2019 from 406,659,000 in 2018. The change in the operating revue is found to be 36% (Veghte 2020).

The company is found to have focused on quality development (Genua et al. 2011 p-45). It has provided training to the employee, small business, and the customers. The sales and marketing team in the company i8s constantly educated and provided deeper knowledge regarding the latest products and services of the company (Schaeffer 2008).

With its strong management system, the company is found to have developed a good system to manage

Customer analysis

Customer is an essential part of the organization. Without the customer, it is difficult to manage the business (Genua et al. 2011 p-44). The number of customers or subscribers is ever-growing. As per the annual report of the company Xero, it is found that subscribers grew to be 1818,000 in 2019 from 1,386,000. There is a growth of 31% in the number of subscribers. In New Zealand, there are 351,000 subscribers (Veghte 2020). The impact of the customer on the business is positive. Their increase in the number of valuable feedback is essential to business growth and development.

Task 3(A1.3.3): Social Responsibility

Social responsibility of an organization is a management concept which the company depicts at the time of interaction with the stakeholders. Corporate social responsibility is a concept in the management world where the companies have to spend a large sum to fulfill the responsibilities towards the society at large (Veghte 2020). The company focuses on social responsibility avoiding damage to society and mitigating the risk from the industry to the surrounded people including stakeholders of the company (Genua et al. 2011 p-66).

Analysis

In Xero limited, there is large spending on corporate social responsibility. The report of 2019 depicts the company has spent a lot on the environmental protection and development of society along with maintaining ethics in the IT world. The company is found to have focused on corporate social responsibility (Genua et al. 2011 p-71). It attempts to make a positive contribution to sustainability and the environment. The company is focused on the growth and development of the organization along with the present and future prosperity and sustainability of the society. The company has tried to create a small business and good people around the world (Veghte 2020). The company aimed to build an established effort for delivering sustainability and environmental initiatives. It also organized programs that will contribute to thriving communities all over the globe. It is also championing the inclusion and diversity for cultivating global workforce.

Environmental sustainability

The company is found to have emphasized on the recycling, waste management, and reduction of the use of energy to reduce the adverse impact on the environment. The company is found to have created an organic T-Shirt for the employee. The branded garment became the point of pride for the employee of the organization (Veghte 2020). The company focuses on low power consumption. The company is committed to develop and use renewable energy. It currently uses 50% of its energy from renewable energy.

Community initiatives

Xero is supporting the community initiative through the volunteer program. It connects itself to the communities for their development and progress (Genua et al. 2011 p-72). The employee of the company has contributed 2800 hours as a part of the community initiative program. The company is also focused on mental health initiatives (Veghte 2020). It is done through the Xero Assistance Programme. The program supports the company through the corporate Employee Assistance Programme. It helps in business startup innovation and business development.

Evaluation

It has been found that the initiatives undertaken by the company to maintain sustainability in the working environment became the source of inspiration and direction for many companies. The company uses only 50% of electricity from traditional means, and the rest of the electricity is being used by the company from a renewable source. The company is successfully developed a large number of small businesses all over the globe (Veghte 2020). The company encouraged companies to innovate. As a part of corporate social responsibility, the company employed more than 42% of the female employee. The focuses on inclusion and diversity met the success and promoted global initiatives. The company also remained succeeded in supporting the mental health programs of the society. The company is also an organized global international Women’s day campaign.

1.3.4: Managerial: Identification

Graham Smith is the role model for the excellent service he provided as the Chair of the Board of the company Xero. The capability and ability to manage a team and nourish an innovative team is praiseworthy. His ability to lead the team in transformation style has brought significant change s to the company and its revenue generation capability (Genua et al. 2011 p-16). His leadership quality remained valuable to me. He is considered to be a role model in my life for team management and the team’s motivation. These leadership traits Graham made him a true leader and allowed him to play a significant role in the development of the company.

He is found to have contributed 25 years in the Saas industry and software (Veghte 2020). His knowledge in the financial software is praiseworthy, and his power of communication and persuasion revealed the height of success he had achieved. He turned to be an independent director in February 2015 and played a significant role as a board member. He held the position of Chief Financial Officer at Salesforce from the year 2008 to 2014. He also held significant executive positions at Advent Software, oracle, and Nuance Communication.

Leadership

With the knowledge and skill depicted by Graham, I can manage a large team within an organization through the transformational leadership style. Managing a team became quite easier within the organization to lead them toward the organizational goal (Young 2016 p-6). The leadership style to manage the team with encouragement to sustain the change and be capable of changing the scenario as per the trends and client’s requirement (Genua et al. 2011 p-18). The team is to be guided with inspiration, vision, and motivation.

The team is to be trained, motivated, and given a proper direction to fulfill the organizational goal along with the career goal of the employee. These will help in the constant motivation of the employee. By constant motivation and encouragement to the employee, it will be quite easier for the employee to manage and control the organization. The motivated employee is the only way to achieve a competitive advantage and it will help to formulate a strong organizational structure to gain a competitive advantage.

Experience Relevance

The completion of two Deakin project has provided me with a lot of experience. The uniqueness of the referencing style has brought some significant interest in me and encouraged me to cite the genuine author and collect the content culled from the major compositions. Deakin's project has inspired me to take up the managerial roles in the organization that I am to serve in my career. It has encouraged me to be a part of the team and guide them in transformation style to encourage them to adopt and adapt change and be capable of making changes within the organization (Genua et al. 2011 p-19). The capability to change and make changes within the organizational structure will allow achieving a competitive advantage and leading the organization towards progress and development without delay (Shapira 2019). The transformation leadership quality that I learned while making projects will be beneficial to my career and growth, and it will be highly profitable to my career as it has encouraged me enough to take such a challenging role from the inspiration that I received from Graham. 

Conclusion

It has been found that the general environment of an organization plays a crucial role in determining the capability of an organization and provides the basis for understanding the capability of the organization. with the environmental analysis of the organization as a whole, it is found that despite the stress of economy and fluctuation of the currency rate, the growth of the business of Xero I ever-expanding and is found to have made a significant mark in accounting and financial software sector. the company's focus on corporate social responsibility and power to grow and change along with powerful leaders within the organization have enforced the fact that comp-any is to expand more and contributed to the business world immensely in the days to come. With the focused research on the organization, it has allowed a broad understanding of the external internal capability of the organization. It has provided a sort of personal growth and development and initiated and motivated to take up a serious role in the organization wherever the individual will be placed.

Reference List

Bhattacharya, D., 2011. Impact of Brand and Residential Environment on Consumer Behaviour – A Study on Inhabitants of North and South Zone of Kolkata City. Indian Journal of Applied Research, 3(7), pp.580-582.

Chen, J, Frijns, B, Indriawan, I & Ren, H 2018, "Turn of the Month effect in the New Zealand stock market", New Zealand Economic Papers, vol. 53, no. 3, pp. 288-306.

Genua, L, Zutshi, A, Phillpot, K, Morgan, M & McElvaney, E 2011, Management, Deakin University, Geelong, Vic.

Jurevicius, O 2020, "If it's Time to be Brave a PEST may be your Best Defense", Strategic Management Insight, retrieved 8 May 2020, <https://strategicmanagementinsight.com/tools/pest-pestel-analysis.html>.

Parker, M 2016, "Price-setting behavior in New Zealand", New Zealand Economic Papers, vol. 51, no. 3, pp. 217-236.

Schaeffer, P 2008, Commodity modeling and pricing, Wiley, Hoboken, N.J.

Shapira, R 2019, "High-Moral Trusting Transformational Leaders, Charismatic-Transformational Leadership, and Charismatic Leadership", SSRN Electronic Journal.

Veghte, B., 2020. Xero Limited 2019 Annual Report. [online] Xero.com. Available at: <https://www.xero.com/content/dam/xero/pdf/about-us/xero-limited-annual-report-fy19.pdf> [Accessed 8 May 2020].

Young, M 2016, "Managing reception", BDJ Team, vol. 3, no. 6.

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