Business and Business Environment - Types of Organizations and Their Impact
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This report explains the different types of organizations with their structures, scope, size and objectives in the context of growth in the international business environment. It also analyzes the impact of organizational structure on different functions of business with their advantages and disadvantages.
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Business and Business Environment INTRODUCTION Business can also be defined as organisation that involves in commercial, industrial or professional activities like trading or exchanging, sale or production of goods and services(Akhtar and Sushil, 2018). Business runs with motive of earning profit and can be able to satisfy customers need. Factor like employees, owners, management integrate with internal forces, while customers need, suppliers, legal aspects, technological and economical changes are covered in external forces. This project evaluates the different types of organisations with their scope, size and structure. Further it explains the relationship between functions of organisation with their impacts along with advantages and disadvantage. Different types of organisation with their structures, scope, size and objectives in context with growth in international business environment. Business organisation is an entity formed with the purpose of making profit through producing goods and services to meet thecustomer’srequirement. There are many types of business organisation explainedbelow: Public sectors– This sector includes the goods and services by government like military, health care centres, infrastructure, public education and many more(Barr and Et. AL., 2018). This sector contains portion of economy with all levels of government and their controlled enterprises. It does not involve private companies, voluntary organisation or households.These organisationsare fully owned and managed by government includes schools, healthcare, emergency services and infrastructure of country. Purpose– Public sector works in the direction of making welfare of public with overall development of country. Main objective of public companiesisto deliver goods and services to citizens of country rather than generating profit through the exchange(Bernardes and Et. AL., 2022). For example, Unilever is multinationalconsumer’sgoods company. Unilever has main focus on delivering good quality products to its customers while satisfying their needs. . Legal Structures– some of the legal structures of public sector are discussedbelow: Federal Government – This type of government is combination of three different branches like legislative, executive and judicial government. State Government – This government has special focus on implementing and enforcement of laws in state. They have certain reserved powers, specific powers and responsibilities that national government don't gave. Local Government – It is lowest tier of public administration within particular state. IT has limited power in comparison with other government. Private Sector–This type of organisation is part of economy that is managed by individualor owned by private groups(Faghih and Zali, eds., 2018). It includes all the business which has universal objective of earn profit through their exchange of goods and services. Private sector does not have much influence of government on their operations and functions. Tesco is best example to be taken in private sector company in UK. Purpose– The main purpose behind private sectors are that, they are profit oriented and has objective to generate more revenue from the business operations. It also provides more employment in area with goal of making more money from business organisation. Legal Structures- Some of the legal structures of Private sector are discussed below Sole Trader – This type of structure in business are also known as sole proprietorship, it is type of enterprise owned and managed by individual person. It does not hire employees for work, they basically work alone(Franklin and Marshall, 2019). Partnership – It is formal agreement between two or more people to manage and operate company by sharing its profit according to their ratio. These partners are responsible for sharing its liability and profit equally. Company–It is legal enterprise formed by group of individuals to manage and operate business in commercial or industrial capacity. Companies aredependingon their business structure which can range between partnership, sole proprietorship, or may be corporation.
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Voluntary Organisation– It is group of individuals that enters the agreement to work as volunteers to achieve the purpose included in formation of organisation(Halbert and Ingulli, 2020). This voluntary organisation includes trade associations, trade unions, learned society or can be environmental groups. Forexample,Bill and Melinda gates foundation, Human Right Watch or Environmental protection Agency. Age UK is leading charity organisation UK based with helping people with old age. Purpose– The main purpose of voluntary organisation is to fulfil their mission and work projects in good way to rather than making profit through this. Voluntary organisation prioritisestheir works differently in comparison with regular business performance. Legal Structures- Charity – The practice of charity in voluntary organisation is giving help to needy people includes humanitarian act, unmotivated byself-interest. The main objective of charity of this voluntary is to raise money for the people in need. Trust – In this organisation usually set is of donated assets which are given by one person called donor to another person with clear intention of providing benefit to third party. An explanation of each of the chosen organisations, including: background details, products, size, vision, mission, legal structure and information about stakeholders. BasisUnileverTescoAge UK Background DetailsUnilever was founded in 1929, 2ndof September by the merger of British soap makerleverBrothersandtheDutch margarineproducerMargarineUnie. Duringthetimesof20thcentury, companyhasincreasinglydiversified theirrangeofproductsandstart producing good made of oil and fats which help them in achieving goals as wellasexpandstheiroperations globally. Tesco was called Tesco – Tea before, the name comes from the initials of word TE Stockwell, who is partner in tea supply and CO from Jack's surname. IT was founded by Jack Cohen in 1919(Hamilton and Webster, 2018). The name Tesco was first appeared in 1924 after the Cohen purchase the shipment of tea from TE Stockwell. Age UK is registered charity in United Kingdom and was formed in year 2009 on 25 February and launched in same year but with different date 1 April 2009. Age UK is combined version of operation of previously separated charity called Age Concern England and Help the aged to form the UK's biggest charity for old age people. Products and servicesUnileverismultinationalconsumer goods company, it serves different kinds ofgroceryproducts,foodsand beverages,homedecors,wellness, personal care and cosmetics also. Tesco offers different kind of products like food and non-food products,freshdrinks,grocery,homeandentertainment products,babyproducts,clothing,households,healthand beauty products, electronics also. Age UK provides elderly services which can help them in continue their living in their own home. It involves back independent living, bathing solutions, stair lifts and home lifts and personal alarms.
Size and scopeUnilever is multinational company withpresenceinmorethan190 countries and serving their products and services in international market. ProductsofUnileveriswidely consumed by user at global level. Tesco is one of the largest food retailer in market of United Kingdom and has operation in around 11 other countries withmorethan2318storesaround themwithover326,000people working with them. IT also provides online services through online platform Tesco.com. AgeUKhasmorefocuson ensuring that older people have enough money and can enjoy lifewithfeelingwelland receive high quality health and care thorough them. VisionUnilever has simple vision that is to make sustainable living in common place and they believe that this is the only way for growth in long term business. Tesco has vision of serving customers and communities in planet in a better way every day. This term includes the means of keeping customers at their heartandalsoreflectingour responsibilitiestowardsthe communities and can serve society in more broader way. AgeUKhasvisionthat includesthesupportthey provide to enable, empower and support old age people to live wellasactive,engagedand with influence on members of the community. MissionMissionofUnileveristhatthey could see two billion people one day touseUnileverproductstolook good, feel good and get more in life through them. TescohasmissionstatementisWe makewhatmattersbetter,together. This statement gives clear instruction that Tesco has taken every one in part of their success. MissionofAgeUKisto providefearlessageing,old peoplefeelconnected, respected, support and enabled to enjoy life in quality. Legal structureUnilever has three different level of legal structure these are Local, State and Federal Government. Tesco also has some legal structures forexampleSoleproprietorship, Partnership,Companyandlimited liability partnership. Charityandtrustsarelegal structures of Age UK. Information about stakeholders Unileverhastheircustomers, shareholders,governmentsand regulators,suppliers,communities andpeercompaniesaretheir stakeholders. StakeholdersofTescoincludesits customers, creditors, competitors, local communities and the government. Board of trustees are their main stakeholders.TheseareAnne Fraser,DavidJohnson,Brian Gibbs and Steve Holt. Donors andthepersonwhoare willinglysupportcharityand Age UK. Illustratethedifferentfunctionsofbusinessofchosen organisation,useorganisationcharttoshowhowthe functions interrelated and advantages and disadvantages and how the affect the structure of the organisation. Organisation structure is method which help in flow of work within the organisation. This structure allows management to work together within their individual function of business(Kokodey, Gnezdova, and Lomachenko, 2018). Organisational structure is important for every business organisation as it helps in delivering value in the market. Tesco has tall hierarchical structure andfocusonallthedepartmentsinbusiness.Reasonbehindusing hierarchical structure is that Tesco is large organisation serving nationwide and had many functional layers inside and its structure based on different functionality. Human Resource and Finance– Finance help in allocate resources to business and human resource department works on hiring and recruiting people in organisation to meet the final goal set by management.In Tesco, HR department continuously works on hiring and onboarding employees while considering the cost and benefits to organisation and same finance department does. HR department should make policies that has impact on profitability ratio of Tesco in positive direction. Finance and Marketing– Relationship between these two functions are mainly important in any kind of business. Marketing wants to spend money and finance department has goal to control expenses of business. Tesco as multinational company dealing in different products has various strategies which can be used as purpose of marketing to achieve objectives and for this they need proper finance to promote their products online or offline. Marketing and Production– Marketing department is closely related to the production function of business. Tesco uses the Marketing function for researchanddevelopmentstrategyinmarketforplanningthefuture customers’ needs and preferences. This planning can be used in making desirable changes in production method and can use the tactic of product development.
Production and Operation– Production function of Tesco manages the activities that are related to production, while operation function manages the whole administration, business operation and other related activities in organisation. Analyse the impact of organisation structure on different functions of business with their advantages and disadvantages. Organisation structure helps businesses in make sure that all the necessary task for smooth operation through right people for achieving the profitability in business organisation(Morrison, 2020)(Uluskan and Godfrey, 2018) . This structure help Tesco in guiding the employees, staff members, executives to make sure they understand their roles in company and also provides better accountability and authority between various functions. Advantages of Organisational structures Organisation structure has also some benefits like Specialisation, it involves the grouping of entire functions according to their specialisation which help in ensuring dependable level of competencies. It also beneficial in terms of giving support to an issue within the same functional department. Disadvantage of Organisational Structures Lack of coordination can be considered as weakness of organisation structure. Communication process between different departments are major concern for business now days. Failure in coordination among functional groups is closely related to the drawback in the operational level of the business. CONCLUSION From the above report based on Business and its environment, it has been concluded that different types of organisation have their own impact on international business environment. This report also clarifies the detailed information about chosen organisation with their scope, size,legalstructures,mission,visionsandobjectives.Italsoexplainstheorganisation structures and their interrelation between functions on business with their impact on business organisation.
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