Types and Purpose of Organisations

Business and business
environment

Table of Contents
INTRODUCTION...........................................................................................................................2
TASK 1............................................................................................................................................3
P1 Explain the different types and purpose of organisations.................................................3
P2 Explain the size and scope of a range of different types of organisations........................4
TASK 2............................................................................................................................................5
P3 Explain the relationship between different organisational functions and how they link to
organisational structures.........................................................................................................5
TASK 3............................................................................................................................................7
P4 Positive and negative impact on the macro environment on business operations............7
TASK 4............................................................................................................................................9
P5 Conduct internal and external analysis of specific organisations for identifying strength
and weakness..........................................................................................................................9
P6 Interrelate the strength and weakness with macro factors...............................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment is known as surroundings in which companies operate. There are
basically two types of factors present in business environment i.e. external and internal factors.
These affects business operations of the company. It is essential for companies to run their
functions and operations in an appropriate manner (Vidović, 2015). The following report
consists of three organisations which are of private, public and voluntary sector. Tesco is chosen
for private organisation, a voluntary organisation is also chosen which is Wellcome Trust and
NICE (National Institute for Health and Care Excellence) is taken for analysing public sector
( Andersson, Forsgren, and Holm, 2015). This report includes description of three types of
organisations including voluntary, private and public along with their scope and purpose. The
relationship among organisational functions of a company is also described along with PESTLE
and SWOT analysis for evaluating strengths and weaknesses of the organisations.
TASK 1
P1 Explain the different types and purpose of organisations
Classification of organisations as small, medium and large organisations
Small business Medium Business Large Business
Equity is held by family
member or founder
This is mostly privately held
and few shares are with public
This is generally investor held
equity
Decision making is largely by
owners.
Decision making is by owner
or CEO.
There is distributed decision
making by organisational
hierarchy.
Small customer base and
generally local markets
Limited customer base Diverse customer base
Private organisation – This is known as person, partnership, association, corporation or agency
which isn’t a public body and motive of running it is profit (Luqmani, Leach, and Jesson, 2017).
There are various kinds of private organisations which are sole traders, partnerships, private
limited and public limited companies.

Purpose- The purpose of private organisations is to generate higher amount of profits from vital
range of operations and activities. Such as the objective of Tesco Plc is to earn higher amount of
profit by selling more number of units.
Legal structure- The chosen company Tesco is in form of partnership. It is so because this is
managed by different partners. Basically, the partnership is best way for private organisations to
operate their business with funds. There are basically two or more owners in this case. Profit and
loss are bearded by both partners.
Stakeholders- The stakeholders for above plc are both internal and external. In the external
stakeholders there are customers, suppliers, government etc. While under internal stakeholders
there are employees, managers and board of directors.
Public organisation – These are government owned organisations of the country. The
main objective of these are to provide quality and good products and services to people. Various
public limited organisation are based on oil, gas, fertilizers, coal, steel, etc. Their objective is
profitability of company. This helps in increase of economic development of the country. The
example of public limited organisation is NICE (National Institute for Health and Care
Excellence).
Purpose- The purpose of these kind of business entities is to serve general public in an effective
manner so that development of nation can be assure. Like the purpose of chosen company NICE
(National Institute for Health and Care Excellence) is to offer better healthcare services to
general public at lower cost.
Legal structure- Under the legal structure of public organisation local, regional and state
government is included.
Stakeholders- Under this type of organisations, the key stakeholders are employees, general
public and government who makes policies and rules.
Voluntary Organisation – Such organisations do not have aim of earning profit or
money. Their focus is to solve societal problems and issues. Wellcome Trust is one such
example. It is a UK based organisation started in the year 1936 by Henry Wellcome. This
organisation has aim for Biomedical Research.
Purpose- These organisations exist in the business environment in order to help those people
whose financial condition is poor and not able to acquire basic things.