Understanding Business Organization

This report discusses the different types of business organizations, compares and contrasts organizational structures, explores various business functions and their impact on organizations and individuals, and defines organizational culture and its importance for success. It also includes references from books and journals.

Understanding Business Organization

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................4
Types of business:........................................................................................................................4
Compare and contrast organizational structures..........................................................................5
Discuss different business functions such as Human Resource Management, Production,
Operations, etc. and the impact of their functional management activities on organizations and
the people within the organizations.............................................................................................6
Define organizational culture and explain how positive culture impacts on the success of
organization.................................................................................................................................7
CONCLUSION................................................................................................................................8
REFRENCES...................................................................................................................................9
Books and Journal........................................................................................................................9
INTRODUCTION
The phrase "business organization" refers to how companies are organized and how that
structure aids them in achieving their objectives. In general, companies are set up to either make
a profit or contribute to the betterment of society. Sole proprietorship, partnership, and
corporation are the three fundamental types of company structures. Employees have the
flexibility to make decisions as a result of the organizing process, which allows them to flourish.
They are constantly prepared to take on new tasks. This circumstance may be beneficial to the
company's growth (Rhodes, 2017). This increases the enterprise's earning potential, which aids
its growth. This report going to analyze the standing of variety of the organization types and their
functions and also going to explain about the impact of functional management activities on the

company and on the individual. Along with this report also explain about the organizational
culture and their positive culture impact on the success of the organization.
MAIN BODY
Types of business:
Sole Trader: A sole trader is a self-employed individual who owns and manages their
own firm. A single trader firm does not have a legal identity separate from its owner. Sole trader
is the person who has absolute control over their business over their Assets and profit after. A
sole trader is the personality which is responsible for their business debts and their personal
assets. Example: plumbers, hairdressers and many more.
Advantage:
The main advantage of being a sole trader that they are their own was and they can
dictate the direction and the way of the organization. Another benefit of the sole trader is that
they have power to change the business structure and keep all the profits. As a sole trader the
person become capable to maximize their privacy and they have unlimited liability.
Disadvantage
Sole traders incur all of the risks of starting their own business, as well as the possibility
of unlimited liability. A lone trader is individually liable for the business's debts. This means that
personal property, such as a car or a house, might be sold to cover corporate debts.
Partnership: A partnership is a legally obligatory agreement among two or more persons to run
and direct a industry while splitting profits (Yunoki, Torres and Cholima, 2018). There are
several types of partnerships. In a partnership, all partners share equally in the responsibilities
and profits, while participants in other firms may have limited liability.
Advantage:
There is the option of income splitting, which is a big benefit because it saves money on
taxes.. The commercial dealings of partners are kept confidential. Having a business partner
might help them to share the financial load of running their company's costs and capital
expenditures.

Disadvantage:
A partnership entails sharing revenues and assets, as well as responsibility for any firm losses
and responsibilities, even if the other partner is at fault.
Limited liability Company: A limited liability corporation (LLC) is a type of private firm that
has limited liability. In a every partnership, all partners are jointly and severally liable for the
company's obligations (Kim and Mauborgne, 2017). Because most states do not impose
ownership restrictions, members can be people, companies, other LLCs, or foreign organizations.
There is no limit to the number of people who can join. Most states also allow “single-member”
LLCs, which are limited liability companies with only one owner.
Advantage:
The limited liability organization has fewer corporate formalities and they have
capabilities to use the cash method of accounting and they have no ownership restrictions.
Disadvantage:
The disadvantages of the limited liability organization that the owners must immediately
recognize their profit and the owners of limited liability organization may end up with paying
more taxes than owners of a corporation
Compare and contrast organizational structures
To compare and contrast structures, a small business owner needs first learn how to read
organizational charts. Charts do more than show a company's fundamental structure. Movement
charts represent the flow of information, accountability, and authority. Charts are used for more
than just laying out a company's fundamental structure. Flow charts illustrate communication,
responsibility, and authority flows (Karazi‐Presler, 2020). Lines that link boxes represent these
flows. In large businesses, the boxes may include whole departments or a job role. According to
Reference for Business, the way firms arrange their personnel, or departmentalize, differs. When
comparing the organizational charts of two companies, they may see that one separates
departments by services such as shipping or accounting, while the other organizes employees by
items generated. Understanding the similarities and differences across organizational structures
can assist business owners in selecting the best structure for their company. According to

Research Chapter, the functional organization is based on job specialization, regulations, and a
command hierarchy. The divisional structure divides the company into customer, geographic,
product, and service divisions, with each division working toward the same goals. The matrix
structure starts with a functional framework and then creates divisions that bring people from
various departments together. These divisional projects are worked on by these cross-functional
teams. The team structure opposes bureaucracy in favor of devolving authority to employee
groups.
Discuss different business functions such as Human Resource Management, Production,
Operations, etc. and the impact of their functional management activities on organizations and
the people within the organizations
Distinct functions inside a corporation are performed and controlled by different
components of the firm, much as different organs perform and regulate different activities in the
human body (Doern, Williams and Vorley, 2019). These business functions will ensure that
their company runs efficiently and that their success is maximized. Rather of wearing several
hats, each department will be made up of specialists who specialize in certain areas, such as
accountancy, sales, or digital marketing.
Production:
In every commercial activity, the production function takes centre stage and is a continual
operation. The production cycle is heavily reliant on the marketing function since manufacturing
is only justified when it generates revenue through sales. The production function is largely
reliant on fixed assets and working cash. The financial manager must keep a close eye on the
money invested in productive assets.
Human resources management:
Human Resources (HR) management is one of the most important business divisions for
any company with a large workforce. HR specialists are in responsible of hiring new employees,
evaluating potential candidates, managing employee relations, and ensuring that the workplace
runs smoothly. In addition, the HR department is responsible for ensuring that labour and
employment laws are obeyed, as well as responding to employee inquiries and resolving issues.

Sales and Marketing:
Frequently, the same department handles both of these commercial operations. It is the
responsibility of the sales and marketing departments to promote the firm and reach out to new
and current consumers, partners, investors, and others. Its main goal is to raise brand recognition
and generate money.
Research and development:
R&D is in charge of developing new products, technologies, and processes, as well as
improving existing ones (Quirke, 2017). R&D efforts must be tightly linked with marketing and
sales operations to ensure that the firm provides exactly what its customers want in the most
efficient, effective, and cost-effective manner possible.
The Tesco Company is following and monitoring every activity of the department
in order to get positive outcomes and become successful because these functions and
departments help the company to improve their efficiency and productivity.
Define organisational culture and discuss how it affects the organization's success.
A positive culture may aid in the recruitment and retention of loyal and devoted workers,
which can enhance connections with customers and other partners. Organizational culture, like
any other asset, must be maintained and cultivated to ensure that it matches the organization's
mission and vision. Tesco Company is maintaining positive culture so that they can get more
opportunity and improve their efficiency and productivity. The company culture influences the
environment and the kind of long-term goals that help the firm achieve its vision. The norms and
processes that allow the company to achieve its purpose on a daily basis are also influenced by
culture. (Huling, 2018). Employees are respected and great work is expected every day in a
good workplace culture. Collaboration is frequently aided by a good setting. To increase
productivity and efficiency, a good culture example would be to emphasize each employee's
abilities. The concept of organizational culture refers to the structure of an organization, such as
a corporation or a non-profit, as well as its values, sociology, and psychology. Philosophies,
beliefs, expectations, and experiences are all aspects of organizational culture.

CONCLUSION
The above mentioned report has been concluded that there are different types of business
which are operated in the Marketplace and every business has their own capabilities and
effectiveness. it is very important for the organization to follow appropriate organizational
structure and follow the appropriate functional management activities so that they can get more
positive outcomes. For every organization there are few departments which are very important
for the company so that the company can improve their efficiency and productivity like human
resources management in sales and marketing team operations team production teams and in the
organization positive organizational culture is very important in order to improve their efficiency
and create good workplace culture in the company.

REFRENCES
Books and Journal
Rhodes, C., 2017. Ethical praxis and the business case for LGBT diversity: Political insights
from Judith Butler and Emmanuel Levinas. Gender, Work & Organization, 24(5), pp.533-
546.
Yunoki, T., Torres, L.V. and Cholima, R.B., 2018. A metacommunity ecological approach to
understanding the community organization of fish in artificial ponds of the Mamoré River
floodplain in the Amazonian lowlands of Bolivia. Environmental Biology of
Fishes, 101(9), pp.1329-1341.
Kim, W.C. and Mauborgne, R.A., 2017. Blue Ocean Leadership (Harvard Business Review
Classics). Harvard Business Review Press.
Karazi‐Presler, T., 2020. Note passing as gendered practices of public ambiguity in a hyper‐
masculine organization. Gender, Work & Organization, 27(4), pp.615-631.
Doern, R., Williams, N. and Vorley, T., 2019. Special issue on entrepreneurship and crises:
business as usual? An introduction and review of the literature. Entrepreneurship &
Regional Development, 31(5-6), pp.400-412.
Quirke, B., 2017. Making the connections: Using internal communication to turn strategy into
action. Routledge.
Huling, L.A., 2018. Understanding African American Undergraduate Student Organization
Involvement at the University of California, Davis. University of California, Davis.