Understanding Business Organizations: Advantages, Disadvantages, Organizational Structures, Functions, and Culture

Understanding Business
Organizations

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
The definition and outline of three advantages and disadvantages of the different types of
business........................................................................................................................................1
Compare and contrast organizational structures..........................................................................2
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...............................................................................................................3
Define organizational culture and explain how positive culture impacts on the success of
organization.................................................................................................................................4
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Business organization is a type of entity which is developed for the purpose of carrying on
commercial enterprise. The business organization helps in describing how the business are
structured and how these structures help in meeting the objectives and goals. The main aim of
the business organization is to earn profit and revenue by performing commercial activities. In
this report we will discuss about the definition and outline of three advantages and disadvantages
of the different types of business and also compare and contrast the different organizational
structures (Abdulaali, 2018). The report will also highlight the different business functions
involved in the organization and how organizational and positive culture impacts on the success
of an organization will also be explained in the report.
MAIN BODY
The definition and outline of three advantages and disadvantages of the different types of
business
Business organizations helps in illustrating that how the business are structured and processed in
an organization and how these strategies are used in generating profit margin. The main aim of
the business organization is to produce goods and products for the customers and then generate
revenue from the sell (Dilli, Elert, and Herrmann, 2018). The categories of business
organizations are sole proprietorship, partnership and limited companies.
Sole proprietorship- In this type of business organization the business is owned and operated
by a single individual and this is also known as individual entrepreneurship, sole trader. The
advantage of sole proprietorship is it follow few guidelines of government and has a benefit of
tax because tax is deducted only once in a year and personal tax will be deducted on earning
profit in the business. Apart from this it is one of the easiest and inexpensive process. The
disadvantages of this are there is no liability protection, it’s harder to get financing and business
credit in this type and it is quite hard to sell the business.
Partnership- This is the most commonly used technique for running a business in which there
are more than one partner and each partner is responsible for the profit or loss. The advantages
of this type are more capital is available for the business, greater borrowing capacity and easy to
change the legal structure whereas the disadvantages of this type are liability of the partner for
the debt is unlimited, partners are responsible for each other’s action and risk of disagreements.
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