Analysis of Business Organisation: Structure, Functions and Culture

This report provides a comprehensive overview of business organizations, examining different types such as sole proprietorships, partnerships, and limited liability companies, along with their respective advantages and disadvantages. It further compares and contrasts various organizational structures, including functional and divisional structures, highlighting their suitability for different business sizes and environments. The report also delves into essential business functions like Human Resource Management (HRM), production, and operations, explaining their impact on both employees and the overall organization. Furthermore, it discusses organizational culture, emphasizing its influence on attracting talent, fostering productivity, and differentiating businesses in the marketplace, using examples from organizations like Verdant Leisure and TUI to illustrate practical applications of these concepts. The report concludes by underscoring the importance of understanding these elements for achieving sustainable success in the professional world.

UNDERSTANDING
BUSINESS
ORGANISATION

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Advantages and disadvantages of types of business ..................................................................1
Comparison of different organisational structure.......................................................................2
Different organisation functions.................................................................................................3
Organisation culture....................................................................................................................4
Example from different organisation..........................................................................................4
CONCLUSION ...............................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Business organisation defined as an entity that are formed with the purpose of carry out
commercial business entity. It is generally developed in three forms i.e. individual
proprietorship, partnership and limited liability companies. This essay report discuss the types of
business organisation (sole proprietorship, partnership, limited liability) with their advantage and
disadvantage (Beynon-Davies, 2021). Further it involves comparison and contrast of
organisation structure along with explantation of different function such as HRM, production,
operations etc. Therefore, it also explains organisational culture and their impact on business
along with using different industry practice organisation.
MAIN BODY
Advantages and disadvantages of types of business
Sole proprietorship refers to an unincorporated business entity that is mainly owned by one
individual person. It represent as one of the simplest legal form of business entity. To effectively
understand the term several advantage and disadvantage are presented below:
The main advantage of sole proprietorship is that, sole proprietorship does not have any
particular form of legal requirements. Hence they started their business without any form of
registration. In sole proprietorship there is no need of fill out ton of paperwork, hence, an
individual operate this business with the motive of virtue of doing business. In this type, an
individual is sole owner of any king of profits generated within organisation.
It has several disadvantage also while doing business that, on the occurrence of the loss
sole trader have all the responsibility to fulfil the liability at any cost (The Advantages and
Disadvantages of Sole Proprietorship, 2021). Hence they have unlimited liability. Although they
also face difficulty in obtain funds easily and they in this sole proprietorship does not sell their
business easily to someone else.
Partnership defined as a formal arrangement of two or more than two people who are emphasis
on manage and operate their business along with share the profits. Some pros and cons of
partnership business are demonstrated below:
The advantage of partnership business is that, business partners have split the finances
so that no individual person face high burden. Therefore, due to split of financing responsibility
partners also split the responsibility of operations due to which targets are attained as well and
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profitable results are enjoyed by company (The Pros and Cons of Business Partnerships, 2021).
Due to number of individual person involve for doing business new and innovative ideas are
presented that is beneficial for success and survival of partnership business in marketplace.
The disadvantage of partnership business is the informal arrangement that present due to
great flexibility. In this partners have low percentage of profits but they are fully liable for any
actions brought against the firm. In this type of business conflicts are raised very frequently
because number of partners are working in same level with different ideas that create conflicts at
decision making time.
Limited liability is a type of business organisation that governed under the state laws. Therefore,
owner of the limited liability company refers to their members who manage the company and
also involve in day to day operation of business enterprise (Pros and Cons of a Limited Liability
Company (LLC), 2021). It has several advantage or disadvantage:
The main pros of limited liability is that they get flexibility in terms of distributing the
profits of organisation. In general, the profit is distributed as per the ration of capital contribution
of every member. Another advantage is that, this type of organisation is easily to operate. In this
members have full power to control the business entity directly.
It also have several disadvantage in terms of raising capital, procuring equity and debts
are complex. Limited liability also face issue of confusing in taking decision because every state
have their own regulation and this business work as per the laws imposed by state. In this the
company existence is crease after the death of partners, promoters etc.
Comparison of different organisational structure
Organisation structure refers to a system that reflected how various activities are
directed in order to attain business goals (Dietz and Mulder, 2020). These mainly involves rules,
responsibilities, roles that helps in maintaining the flow of information between different levels
within the organisation. There are variety of organisation structure (Functional and divisional
structure) which are distinct to one another. The comparison between organisational structures
are presented below:
Basis Divisional structure Functional structure
Meaning This type of structure define in
which organisation functions
It refers to that in which reporting
relation of organisation are
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are classified into divisions
according to product, price,
market etc.
bifurcated as per the functional
area.
Suitability This structure is mainly
suitable for large or dynamic
organisation.
Functional structure is appropriate
for small or simple firms.
Autonomy In this manager have autonomy
to make decisions
In this manager does not have
autonomy to make decisions
Cost Expensive in nature because of
repetition of resources.
Economical because functions are
not repeated.
There are various similarities between divisional and functional organisational structure
is that both the structure is used to completed the targets on set time period. Both the structure
are chosen as per the nature of business and preference of top management.
Different organisation functions
Business functions are the activities that are mainly carried out by business enterprise.
There are several business function that impact people and organisation are presented below:
Human resource management refers to a core business function for the company who
mainly have large number of employees (Ziora, 2020). In this HR specialist are mainly
responsible for screening potential candidate, attract talent, maintain optimum working condition
etc. This functional department impact individual employees in positive manner because this
department ensure the use of labour laws, remove conflicts address employee inquiries etc.
further it also impact organisation effectively because HR department develop training programs
so that they value company culture and helps in attaining profitable results. For instance-
Verdant leisure is a tour and travel company where HR department hire employees with good
communication skill and ensures that they get an effective pay as per their calibre. This satisfy
employees so that they give productive results to company sustainability. Hence, this department
is important to develop in business organisation.
Production function expressed in a dominant position in every business activity and its
continuous process. This mainly depends on marketing function because production in
organisation is justified when firm see revenues through sales. Thus this department do heavy
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investment on fixed and working capital because to function production department productive
assets are crucial. This helps people to work in unity and it impact positively on profitable results
of business. For instance- Tesco production department need proper connection with finance,
marketing department to understand the needs and wants of customers and to acknowledge firm
financial position so that production is done effectively. Due to this unity is developed and
company attain high revenues.
Operations is a type of business function where inputs are converted into outputs.
Therefore it present as a heart of every business because it pumps out goods in quantity and
quality that fulfil needs and demands of customers (Hajli and et. al., 2020). If this functions
properly than it will impact the company in positive manner because this department ensures that
company satisfy needs and wants of customers. In this operation manager encompasses
everything so that workers produce tangible and appropriate goods.
Organisation culture
Organisation culture defines as a proper manner to behave within organisation. The
culture express the shared belief and values established by leaders and that are communicated
using various methods to shape employee perception. For instance- In Verdant Leisure there is
positive culture that impact positively on success of organisation because it attract and keep the
talent within organisation, develops productivity due to which employees were become
advocates and this helps in differentiate them within the marketplace (Kohe, Purdy and Litou,
2021). Although, all these are useful to gain profitable and sustainable results to business
enterprise. Due to positive culture within organisation a healthy team was developed that support
in making the happy and healthy business within organisation. Positive culture creates the nature
of long term plans that helps company to fulfil the vision.
Example from different organisation
Example1: Verdant Leisure industry practice is mainly based on promoting sustainable
tourism and protect the natural environment. Hence, they emphasis on developing aim on
reducing the harmful impact from environment. It is a type of SME firm and this industry
practice is fulfilled by follow positive culture where entrepreneur adopts the use functional
structure so that this practice is easily attainable.
Example 2: TUI is a tour and travel company that is large organisation follow divisional
structure to manage the working criteria within organisation. In this the industry practice they
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follow is to emphasis on offering those services to customers which does not create carbon
emissions and harm the living beings (Chi, 2020). This helps in gaining successful results in long
term survival.
CONCLUSION
From the above report it is concluded that this report helps in understanding the types of
business organisation, organisational structure and different functions that are working in the
organisation. It is crucial to sustain in professional world with high success. This report also
elucidates organisation culture that impact positively on the success of business so that it could
be survive for longer time period.
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REFERENCES
Books and Journals
Beynon-Davies, P., 2021. Business Analysis and Design: Understanding Innovation in
Organisation. Springer Nature.
Chi, Z., 2020. The Political Economy of China’s Business Organisation Laws and its
Implications for Legal Transplantation: Evidence from the Venture Capital
Industry. Australian Journal of Asian Law. 21(1).
Dietz, J.L. and Mulder, H.B., 2020. Enterprise Ontology: A Human-Centric Approach to
Understanding the Essence of Organisation. Springer Nature.
Hajli, N. and et. al., 2020. Understanding market agility for new product success with big data
analytics. Industrial Marketing Management. 86. pp.135-143.
Kohe, G.Z., Purdy, L.G. and Litou, A., 2021. An examination of para-sport organisation
approaches in France. Developing and Supporting Athlete Wellbeing: Person First,
Athlete Second.
Ziora, L., 2020. Machine learning solutions in the management of a contemporary business
organisation. Journal of Decision Systems, pp.1-8.
Online
Pros and Cons of a Limited Liability Company (LLC), 2021. [Online]. Available through:
<https://www.allbusiness.com/pros-and-cons-of-a-limited-liability-company-llc-2517-
1.html>
The Advantages and Disadvantages of Sole Proprietorship, 2021. [Online]. Available through:
<https://www.nerdwallet.com/article/small-business/advantages-of-a-sole-
proprietorship>
The Pros and Cons of Business Partnerships, 2021. [Online]. Available through:
<https://www.businessnewsdaily.com/15746-business-partnership-pros-and-cons.html>
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