Understanding Business Organisation: Types, Structures, and Functions

This report discusses the different types of business organisations, their structures, and functions. It covers sole trader, partnership, and limited company, as well as tall and flat structures. It also explores the impact of marketing, human resource management, customer services, and organisational culture on business performance.

Understanding Business
organisation

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY ..................................................................................................................................3
CONCLUSION ...............................................................................................................................3
REFERENCES ...............................................................................................................................4

INTRODUCTION
Business organisations is a term which highlights the structure of companies. The
structure of any company helps the employees and managers to work in a systemic manner with
the intention to reach their objectives (Ahmad and Murray, 2019). However, companies are
designed and operates with the focus to generate maximum profit in the marketplace and gain a
good reputation and value in the society. These companies always tends to modify and innovate
their ideas in one or another way for betterment of society and serve them effectively. Business
organisations can be of many types like proprietors and partnerships. The companies always
tends to prefer different organisational structure, policies, business approach or culture which
may help the business to achieve its goal.
This report will mention many merits and demerits of a business along with comparison
and contrast among flat and tall frame of the business. Further, it highlights different functions of
the business and influences of their activities on people. Additionally, the report explains
positive impact and culture of the organisation on success of a business.
MAIN BODY
Sole trader refers to sole proprietors, it denotes to a well-organised business, well-
managed by an individual. For instance- Mogford Hotel, the organisation in which owner is
responsible for all the gains and losses after overall deduction of tax (Alade, 2022). Benefits
associated to sole traders is that entrepreneurs does not bounded by anyone and free to change
their legal structure according to the circumstances or if they wish to grow their business. It
needs a low starting cost and owner of the company bear all the losses and does not have to share
the profit. Alike, demerit with sole trading includes the challenge to find and retain high skilled
workers which are the main assets for growth and success of a enterprise. It become difficult for
the company to apply additional money in order to expand the business by themselves.
Additionally, all losses and debts are bear by the owner of the company solely.
Partnership Is the type of business and a type of arrangement in which two parties or
organisations mutually takes decision and sign agreements to operate the business with mutual
efforts by sharing losses and profits either equally or according to the percentage of share being
decided. For instance- D Fusion. Partnership relation in a business allow two people to share
ownership, they become co partners and distribute profit and liability on the basis of share. Both

parties mutually mange company and work with the intention to generate maximum potential
revenues and make good reputation in the market (Aldous, 2018). Benefits of mutual relationship
includes; equal division of responsibilities, work, profit, risk sharing and investment of extra
capital became easy. Demerit of partnership is that there may develop the possibilities of fraud or
conflicts between the partners, loss of autonomy, share of power and control, limited liability and
lack of stability.
Limited company refers to organisation-type in which all the profits and losses are
limited to stakeholders. For instance- Park Holiday. It is a sort of legal structure that ensures the
liability of business subscribers is limited to their investment addition to commitments in the
organisation. Some merits of limited company are; opportunity to maximum lending and
investment, minimise the personal; liability, separate legal entity. Demerits of limited company
is that particular organisation have limited rights to add more money to the business, there is no
separate legal status, chances of differences, losses and disputes increase.
Tall and flat structure is the organisational structure which bear its some merits along
with some demerits on the basis of their nature (Anshari and Sumardi, 2020). Tall structures are
in vertical form while flat structures exist in horizontal form. Small scale organisations like
Mogford Hotel prefer flat structure due to presence of small number of employees and lack of
management level at the hotel. Apart of it, organisations with capability of large hospitality like
Park Holiday prefer to use tall structure where multi management level with a CEO, board
members and directors are presented to handle and manage the business. Tall structure consist
multiple level of management staff and huge chain of command because of complexity on the
business operation for which huge workforce is required. More over, start up hospitalities and
sole trading organisations prefer flat structure with short chain of command, less number of
employees with one manger and limited level of management.
Flat structure is comparatively less complicated to understand (Joyce, 2021). Limited
employees are required to report to one manager while in tall structure many employees have to
report to the manager of the dedicated department. In flat structure, employees can work
independently due to presence of single manager and are generally high skilled and educated.
Control of single manager can create some issues among workers due to lack of accountability
and guidance. While in tall structure employees are less skilled and unskilled so employees work

according opt the commands given by their supervisors which enhance the profitability and
productivity of hospitality company due to proper guidance and control.
Marketing refers it is the most critical activity which relates to advertisements and
promotions of services and goods. These activities are conducted by an organisation with the
intention to promote and sell their services and products to large number of customers. For
instance, Park Holiday marketing tactics adopted by manager of the organisation puts a great
impact to the company as it assist the employees to know about the advanced technology and
recent trends which may prove to be beneficial for the firm to enhance the quality of their
hospitality services which provide good profit, increase market share, customer base of
hospitality company (Pedler and Hsu, 2018).
Human resource management is the strategic app[roach which is effective and efficient
for the management of Park Holiday through which the hotel gain the opportunity of enjoy
competitive advantage. Managerial activities of HR influenced performance and productivity of
employees in a positive manner. HR management is an important element to a company
responsible to hire workforce and engage them in same direction. It control the performance of
employees, help to reduce cost and time which is responsible to maximise the quality of services.
Customer services refers to an organisational department which directly interact to the
customers with the purpose to resolve issues and respond to their services. For instance in Park
Holiday, the influence of management activities of consumer services as it inform employees
about failure and achievement of services provided by them which serve as a feedback to
improve their performance. It also assist the company to make decisions about the area of
investment and divestment to achieve markable growth in market (Smirnova, 2019).
Organisational culture refers to determination of codes of ethics, assumptions,
expectations, moral values, beliefs which guides the behaviour of overall employees serving for
the company. Through this the management have opportunity to engage their talented employees
for the accomplishment of goal of organisation in similar direction. Organisational culture is the
most crucial factor in a business which helps to bring unity and harmony among the employees
for performing well and working in a direction to build a strong team for growth of the business.
Management staff of Park Holiday enable to manage their activities from room services to
reception area and from HR management to customer services. Effective and good performing
organisation can be a major factor to boost up the morale of the working employees within the

company and make them feel confident, motivated and help them to reach the height of their
desired goals. It allow employees of the company to establish better interaction with each other
with the purpose to acknowledge the weakness and strength uphold by their subordinates. This
knowledge about capability of employees helps the managers to assign task to the employees on
the basis if their calibre and skills in order to ease their difficulties in achieving the task timely.
Good culture within the organisation helps the management to enhance productivity,
performance and retain employees for long period of time to achieve pre-determined goal by the
company (Staniškis, 2022).
CONCLUSION
From discussion made in above report it is concluded that partnership, sole trader and
limited company are some of the legal structures of the company which is chosen by
entrepreneur of an organisation in order to run business smoothly. Every type of business
organisation and approach have their own advantages and disadvantages that are required to be
taken under consideration prior to taking any decision for the business. Another types of
organisational structure includes; divisional structure, tall structure, functional structure and flat
structure that a firm select to operate their business in a possible effective manner. Generally flat
structure is followed by small scale organisations and tall structure are preferred by large scale
organisation. There are many functions like human resources, operations, customer services and
marketing influence the productivity and performance of organisation.

REFERENCES
Books and Journals
Ahmad, M.U. and Murray, J., 2019. Understanding the connect between digitalisation,
sustainability and performance of an organisation. International Journal of Business
Excellence, 17(1), pp.83-96.
Alade, K.T., 2022. Developing a leadership framework for improving construction business
organisation performance in South Africa.
Aldous, M., 2018. Business ownership and organisation. In An economist’s guide to economic
history (pp. 167-174). Palgrave Macmillan, Cham.
Anshari, M. and Sumardi, W.H., 2020. Employing big data in business organisation and business
ethics. International Journal of Business Governance and Ethics. 14(2). pp.181-205
Joyce, Y., 2021. Corporate insolvency: policy, practice and professional organisation (Doctoral
dissertation, University of Glasgow).
Pedler, M. and Hsu, S.W., 2018. Regenerating the learning organisation: towards an alternative
paradigm. The Learning Organization.
Smirnova, L.S., 2019. Economic effects of the implementation in the company of the innovative
models of management based on the stakeholder approach and network forms of the
business organisation. International Journal of Nuclear Governance, Economy and
Ecology. 4(4). pp.273-287.'
Staniškis, J.K., 2022. Sustainability Challenges in an Business Organisation. In Transformation
of Business Organization Towards Sustainability (pp. 3-14). Springer, Cham.