Types and Purpose of Business Organisation

BUSINESS AND BUSINESS
ENVIRONMENT

TABLE OF CONTENT
TABLE OF CONTENT...................................................................................................................2
INTRODUCTION...........................................................................................................................3
LO 1.................................................................................................................................................3
Types and Purpose of Business Organisation..............................................................................3
Size and Scope of Different Types of Business Organisation.....................................................6
LO 2.................................................................................................................................................9
Interrelationship between Different Organisational Functions....................................................9
LO3................................................................................................................................................13
Positive and negative impact of macro environment on business operation.............................13
LO4................................................................................................................................................16
Internal and external analysis of ASDA....................................................................................16
The way strength and weakness related to macro environment................................................18
CONCLUSION..............................................................................................................................20
REFERENCES..............................................................................................................................21

INTRODUCTION
Business environment consists of different factors which influence the activities of business
and its performance to achieve objectives. It is very essential for business organisation to analyse
macro and micro factors in the business environment to develop effective strategies and compete
in the market effectively. due to increase in the competition in the market and enhanced
customers taste and preference it is very important for businesses is to examine the behavioural
patterns of customers develop products according customer’s needs and wants to increase their
satisfaction effectively. This report provides detailed study on different organisation as example
to focus on internal and external analysis by Pestle and Swot analytical tools. In addition report
provides information on purpose, size, scope of different types of business organisation present
in the market. in addition, report provides interrelationship between different functions of Asda
which is UK based retail store chain company. This report aims to analyse all the factors which
can increase the performance of Asda to compete in the market and increase profit margins
effectively.
LO 1
Types and Purpose of Business Organisation
Profit organisation: Firm that are operated and runned to earn specific amount of profit margin
by meeting needs and requirements of each individual that live in market such as mostly private
companies operated to earn profit likes ASDA.
Non profit organisation: These are firm that are operated with objectives to render qualitative
services to customers rather than earning more amount of profitability. Such as save international
children is non profit fir operated to provided maximum benefits to individual.
Public Organisation
Public organisations are those which are controlled by government and serve the major
motive of social welfare (Lisowska, 2016). Public organisation also has the potential to support
private organisations to increase their potential and boost productivity to increase satisfaction of
citizens effectively.
Public sector organsiation
Automatic weapons establishment is an example of public organisation in UK which research
and develop new weapons to protect citizens from criminal activities and ensure the safety
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security of people in the nation to increase productivity effectively. Selected shareholders by
public have authority to take all crucial decision for smooth operation of enterprise.
Public sector organisations like AWE can distribute their share to public to increase the
operating capital and increase the potential to innovate and protect citizens effectively.
Objectives: Public organisation has the main purpose to increase the social welfare and prioritise
safety and security of people of the community.
Public limited company: These are organisation that are owned by public or government to
provide products and services at reasonable rates to various individual so that ther needs can be
meet such as Tesco is Public limited company which operates to offer products at minimum
prices.
Purpose
 AWE has the responsibility to develop modem weapon to disable all the threats on the
nation and protect citizens of UK effectively. Public organisation helps to increase the standard of living of the people and increase
productivity of economy to grow effectively.
Legal Structure
 AWE is owned by government and since it is defence organisation all the funds are
generated from the tax revenue of the citizens to improve the quality of weapons. Pubic business organisation has increased liabilities which can impact the decision
making process to increase the size of the company in the market (Brkljač and Sudarević,
2018). Corporate governance in the public sector is very complex due to involvement of
different ownerships.
Private Organisation
Economic growth is very important for nation to provide more facilities to its population
and improve the personal growth to develop higher income in the nation. private organisation
focuses on increasing the economic activities of nation and providing more employment
opportunities. This also increases the income level and hence increases in the disposable income
to improve overall demand in the manufacturing industries. This also supports higher
productivity at lower inflation rate to increase satisfaction of people of the country effectively.
For instance, Asda is one of the private retail organisation which provides grocery products
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through store supply chain system. This helps to support the local community to grow and
increase their knowledge and make better decisions.
Sole trader: These are enterprise that are managed and controlled by single individual to earn
specific amount of profitability for itself and family member. Legal owned by single individual
and main aim is to earn profitability such as IKEA is owned and managed by Ingvar kamprad
that is operated to render qualitative services to large number of individual.
Partnership: The firm that are legally managed and owned by two or more partner to earn
sufficient amount of profit by rendering services to customers so it objectives is also to earn
profit. Such as marks and Spencer have Michael marks and Thomas spencer have decided to
operate in retail industry by providing services and products such as clothe, financial services
and home care products.
Private limited company: These companies are runned by directors and capital is raised thorugh
number of shareholders to specific limit. Onwer cannot be bided to pay debt beyond the share
holders therefore amount of liability is limited. Such as Greenergy is private limited company in
british that provide petrol and diesel and operates to earn maximum profit margin through
offering qualitative services to end users.
Purpose
 Main objective of Asda is to increase profit margins to grow in UK market and expand
effectively. Company also has the motive to provide high quality of goods and services to
attract more customers and enhance their experience.
 Developing new marketing strategies helps to increase customer awareness and enhance
perceived value of products and services of Asda to improve brand value and make loyal
customers effectively (Taran and et al., 2016). Private organisation also increases the products and service options for the customers due
to increased competition. Asda has to develop new products and services to compete with
Tesco, Sainsbury’s and attract more customers to gain more profit margins.
Legal Structure
 Private organisation uses corporate governance strategy to generate higher leadership in
the market by making better decision.
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 Private organisation also limits their liability to invested capital at the time of
commencement of business.
Voluntary Organisation
There are many challenges which are increasing in the society and it is very essential for
organisations to participate in some social work to improve efficiency of community effectively.
Voluntary organisation focuses on social, environmental health and develops different strategies
to protect them effectively (Dima, Hadad and Luchian, 2017). These are the organisation which
volunteers in the social welfare of the community and increase satisfaction of people effectively.
Save the children international is of the largest voluntary organisation in UK which do not focus
on profit generations. Organisation provides donations to support children development in the
society and provide them all the facilities to increase their potential effectively.
Purpose
 Save the children organisation helps to provide benefits to children all over the world by
spending more than their revenues. The main focuses of voluntary organisation are the increase the moral ethics of the
society and improve quality of living for people of country effectively.
Legal Structure
 Save the children international organisation is being appreciated by the government of
UK which also helps to increase trust of donators in the organisation.
 Voluntary organisation is formulated by group of trustees which donate their funds and
attract more charity for children (Athanasopoulou and de Reuver, 2018).
Size and Scope of Different Types of Business Organisation
Public enterprise have unlimited scope of development as it can issue share to number of people
and expand business to fulfil needs of different individuals at the same time is large size
organisation due to wide products portfolio and scale of operation. On the other hand private
enterprise also continuously grow and expand business to earn profitability but have limited or
smaller market share as compared to public enterprise. At last Voluntary enterprise have few
resource, employees that are need to satisfied need of few individual or target market. Therefore
size and scale of operation of voluntary enterprise is limited or fewas it is not operated for
earning profit rather to rendered services at free cost.
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