Understanding Business Organisations and Their Environments

This report discusses different types of businesses, their advantages and disadvantages, tall and flat organisational structures, different business functions, and organisational culture and its impact on business success. The report also provides an overview of Asda, a UK-based supermarket chain.

Understanding business
organisations and their
environments

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK- 1...........................................................................................................................................3
Advantage and disadvantages of different types of business......................................................3
TASK 2............................................................................................................................................4
Difference between tall and flat structure...................................................................................4
TASK3.............................................................................................................................................5
Different business functions in an organisation..........................................................................5
TASK 4............................................................................................................................................7
Meaning of organisation culture and its impact on the success of company..............................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business is defined as the legal entity that involves in various commercial, professional as well
as industrial activities. Organisations require different type of resources such as labour, raw
material and finance to carry business operations in efficient manner. There is specific structure
is adopted by the organisation to run business activities in systematic manner. There are different
type of business such as sole proprietor, partnership, corporation and various other are operated.
These businesses are established for specific objectives such as making profit or help society
(Stein, 2017). Generally, business is conducts commercial activities to provide goods and
services with the objective of earning profits. In this report, the chosen organisation is Asda is a
supermarket chain established in 19 February, 1949 by Peter and Fread Asquith. Headquarter of
organisation is situated in Leeds, England. Organisation is involved in offering clothing, health,
foods and many other products to customers. In this report benefits and drawbacks of different
business, difference between flat and tall organisational structure are covered. Furthermore,
different business functions and organization culture are discussed in this project report.
TASK- 1
Advantage and disadvantages of different types of businessSole trader- Sole trader are the individuals who manages their work on their own and have to
face their own losses as there is no other individual.
Advantages: The main advantage of forming this business types is that it is very easy to
form a business as it requires no other documentation(Oliva and et. al., 2019). The other is that
the owner enjoys all the profits which they earn and they don't have to share it with others.
Disadvantages: Major drawback is that they have limited capital and limited resources by
which they can borrow money during the time of losses if they will be facing. It is also not sure
that all the decisions of the owners will help them in achieving success of the business. For
example-Partnership- Partnership is formed between two or more people by forming an agreement in
which all the rules and regulations are mentioned.
Advantages:The main advantage factor is that when there will be more people who will
be handling the business then the burden will be shared and the unique ideas can come up

(Olsen, 2019). The other is that they will be having better decision making in framing the
objectives and plans.
Disadvantages:The drawback is that there are chances of having conflicts with one
another if the partners are not getting agreed on any decision. The other is that decision making
in partnership is quite late because it has to be approved by every partner.Limited company- The limited company is considered to have a separate business which is
separated from their owners and the business managers.
Advantages:The advantage of starting this business is that they have the option of limited
liability which is the best for the people who are the part of business. The investors have higher
personal income because they can save their income from being taxed.
Disadvantages:The disadvantage is that there are certain restrictions on naming the
business name and also no individual can start this business if they are bankrupt but have
discharged or a disqualified director.
TASK 2
Difference between tall and flat structure
Organisational structure is defined as the aspect that determines that how business
arranges its staff members and different layer of management. Basically, there are mainly two
business structures are used by organisational such as hierarchical (tall) and horizontal (Flat).
Tall structure
Flat structure
Meaning Hierarchical or tall organisational
structure is defined as the structure
in which number of leaders and
layer of management are exist
(Banfield, Kay, and Royles, 2018).
Top to down approach is used in
this structure with long chain of
commands.
Horizontal or flat organisational
structure only layer of
management is exist. There is
short chain of command in
followed and it contains short
and quick communication.
Span of control There is less span of control is
found in tall organisational structure
because in there is many managers
In flat organisational structure
wide span of control in found
because there is less number of

are appointed at all hierarchical
level. Less number of employees
and subordinates are work in this
structure.
hierarchy is established and
managers work for many
subordinates.
Structure Decision-making process takes too
much time in tall organisational
structure because there are many
hierarchical level in business and
each decision need to be conveyed
and approved at all level.
On the other hand, In flat
organisational structure decision
making process is quick and
effective due to less number of
hierarchical level.
Costs There is high cost is involved in
maintaining organisational structure
because each level of business need
to be managed by the organisation.
Whereas, in flat organisational
structure lesser management
level are exist that reduce the
cost of business (Fink, Yogev
and Even, 2017).
Opportunity There is high opportunity for
employees of getting promotions.
On the other hand, in flatter
organisational structure less
opportunities are available for
employees.
Example The organisational structure of
ASDA organisation is formal
hierarchical and functional
structure. There is various functions
departments are operates in
organisation.
Divisional or flat organisational
structure is adopted by the
NIKE organisation to run all
business operations in efficient
manner.

TASK3
Different business functions in an organisation
There are various functions are performed by the organisation to run all activities in
efficient and effective manner. In business all functions are determined to all employees that
enable them to perform functions in best possible manner to attain defined goals and objectives.
Some functions of business that impacts organisation and employees are mentioned below:
 Marketing function: Marketing is defined as the activity that is undertakes by the
organisation for responsible for promoting organisational products and services to
targeted customers. There are various activities are included in marketing such as
advertising, selling and delivering organisational products to consumers and other
businesses. ASDA conducts various marketing campaigns on social media to attract
customers. It improves organisational sales and profitability ratio.
 Human resource function: Human resource department plays important role in recruiting
and selecting right talent in business who can perform defined business functions in best
possible manner and contribute in attaining goals and objectives. HRM department of
ASDA provides training and development opportunities to employees that motivates
them to perform in best possible manner (Revilla and Saenz, 2017). Human resource
managers create effective working environment and resolve employees problems that
help to retain them with organisation for longer period of time.
 Production function: Production or operations department is involve in the function of
converting input or raw material into output according to demand of customers. ASDA
production organisation ensures to produce quality products that satisfies customer
requirements. Respective department prepare schedule for raw material that must
available in storage in specific period of time. As ASDA is the retaining supermarket that
provides range of products to customers.
Business formulates functional management department that manages organisational
functions and ensure their proper implication for the purpose of attaining determined goals and
objectives in best possible manner. It impacts organisation and employees. Functional managers
supervise employees performance and guide them to perform efficiently to run business in

efficient manner (Niskanen, 2017). It facilitates organisation to achieve the objective of higher
productivity and profitability. Through observation and supervision employees productivity and
performance also improved.
TASK 4
Meaning of organisation culture and its impact on the success of company
Organisation culture means the values, practices and expectations which exist in the
workplace but need to be in a positive way. The culture of workplace plays a very important role
in better management decisions and in accomplishment of objectives.
It is because when the environment in the company is good then there will be less politics
and employees will be focusing on more productive work(Fenech, Baguant and Ivanov, 2019).
There will be open communication between employees as in good organisation culture there will
be less restrictions and more flexibility so that employees can communicate with their other co-
employees. This lead to better development of ideas because if one person will do the interaction
with other then they will learn many new things. There will be less complexity in decision
making and this will lead to faster execution of the results. Effective organisational culture
motivates employees to achieve high work performance objectives and contribute in attaining
business goals and objective. It enhances relationship between employees and employer that
inspire to perform efficiently. Asda provides regular monetary benefits and career development
opportunities to employees that plays important role in success of business. When employees
have flexible business environment that they are committed towards business and ensures
business success in defined period of time.
CONCLUSION
As per above report, it can be concluded that organisation of business is very important
for running all activities in defined manner and attain goals and objectives efficiently. Business
activities are conducted in different types that contains their own advantages and disadvantages.
Organisational structure id adopted by the business according to business activities. There are
various functions are performed by the organisation that are interlinked with each other and
impacts on overall business performance. In competitive environment, it is important to maintain
effective working culture to retain employees for longer period of time.

REFERENCES
Books and Journals
Banfield, P., Kay, R. and Royles, D., 2018.
Introduction to human resource management. Oxford
University Press.
Fenech, R., Baguant, P. and Ivanov, D., 2019. The changing role of human resource management
in an era of digital transformation.
Journal of Management Information and Decision
Sciences, 22(2). pp.1-10.
Fink, L., Yogev, N. and Even, A., 2017. Business intelligence and organizational learning: An
empirical investigation of value creation processes.
Information & Management, 54(1),
pp.38-56.
Niskanen, W. A., 2017.
Bureaucracy & representative government. Routledge.
Oliva, F. L. and et. al., 2019. The integration between knowledge management and dynamic
capabilities in agile organizations.
Management Decision.
Olsen, J. P., 2019. Political Science and Organization Theory Parallel Agendas but Mutual
Disregard. In
Political choice (pp. 87-119). Routledge.
Revilla, E. and Saenz, M. J., 2017. The impact of risk management on the frequency of supply
chain disruptions: a configurational approach.
International Journal of Operations &
Production Management.
Stein, H. F., 2017.
Listening deeply: An approach to understanding and consulting in
organizational culture. University of Missouri Press.