Understanding business organisations and their environments

This report covers the definition and outline of three advantages and disadvantages of different types of businesses, comparison of tall and flat structure of an organization, different business functions, and the impact of their functional management activities on the organization and people within it.

Understanding
Business Organization

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
The definition and outline of three advantages and disadvantages of the different types of
business for example: sole trader, partnership, limited company etc..........................................3
Compare and contrast tall and flat structure of an organization..................................................5
Discuss the different business functions such as human resource management, production,
operation etc. and the impact of their functional management activities on organization and the
people within the organization.....................................................................................................6
Define organizational culture and explain how positive culture impacts on the success of
organization.................................................................................................................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business organization is basically defined as an entity or the group which is developed for
the purpose of handling different types commercial activities within enterprise. This type of
organization is predicted on systems of law governing contract and exchange, incorporation and
property rights (Appio, Lima and Paroutis, 2019). Here various types of companies are selected
which comes in the category of hospitality and tourist industry which includes such as
intercontinental hotel, Hyatt hotel etc. The report will be covered definition and outline of three
advantages and disadvantages of the different types of business for example sole trader,
partnership and limited company. It also covers compare and contrast tall and flat structure of an
organization, discuss the different business functions such as human resource management,
production and operation and also explain the impact of their functional management activities
on organization and the people within the company. It further covers explanation of
organizational structure and discuss how positive culture impacts on the success of company.
TASK
The definition and outline of three advantages and disadvantages of the different types of
business for example: sole trader, partnership, limited company etc.
Sole trader – It is defined as that type of organization where whole powers are coming in the
hands of single person and that person is the owner of company. In this type of organization
whole operational and departmental functions is managed by individual person. Due to this it is a
highly simple and effective structure for intercontinental hotel in aspect of increasing their
performance and productivity at maximum level.
Advantages of sole trader -
Firstly, in this structure intermediaries are very low and due to this the performance of the
employees are strictly monitored on regular basis.
Secondly, in this structure decisions are made quickly from top level management which
leads to increase the work efficiency of company at maximum level.
In third, according to this structure lower level employees are able to share their problems
to higher authorities directly and freely.
Disadvantages of sole trader -

Firstly, the biggest problem of this structure is that workload and stress is highly
increased in the minds of employees
Secondly, due to direct connection between company owner and lower level employee
the positive relation between them is not effectively sustained for long time.
In third, due to enhancing work load in the minds of employee’s organization is not able
to sustain their vision, mission and objectives in long term.
Partnership – In this type of organization written contract or agreement are made between more
than one persons in aspect of running the various activities of company smoothly. In this
structure roles and responsibilities are assigned to all levels of workers with in company
according to their interest and specialization (Attaran and Woods, 2019). In context to Hyatt
hotel, management must facilitate duties to their workers equally which leads to maintain
positive relationship between employee and employer for long time.
Advantages of partnership
The first advantage in this structure is that roles and responsibilities are clearly defined
and distributed to all categories of workers within organization.
The second benefit is that due to having contract with all categories of employees, the
conduct of illegal activities from worker’s side are highly decreased.
The other benefit is that due to run the business activities in legal manner the goodwill of
company is effectively sustained in market for long time.
Disadvantages of partnership
The biggest problem in partnership is that due to written agreement or contract powers
are divided between more than one person in higher authority.
The other demerit is that due to distribution of powers final decisions are made in very
slow manner from higher authority. It leads to decrease the work efficiency of their workers at
high rate.
The last disadvantage is that in this structure the interference of middle level employees
is highly involved.
Limited company – Limited company is defined as hybrid entities that combine the
characteristics of a corporation with those of a sole proprietorship and partnership. It also refers
to the corporate structure where owners of company are not personally liable for their liabilities

and debts. In context to Virgin holidays, management must provide flexible work environment
to their employees which leads to increase their passion and interest in their work effectively.
Advantages of limited company -
In this structure employees of organization have high flexibility in their job roles and
responsibilities.
In this type of structure organization did not required any type legal formalities and
written agreement for run their operational activities.
Owners are not personally responsible for business debts and liabilities
Disadvantages of limited company -
Due to following this type of structure the overall expenditure of the firm is highly
increased in their business activities and services.
In some circumstances, owners of a limited company may end up paying more taxes than
owners of a corporation (Begenau and Salomao, 2019).
A limited liability company generally has the same two sources of raising funds as a
corporation: equity and debt which leads to decrease their performance effectively.
Compare and contrast tall and flat structure of an organization
Tall organizational structure is referring to the where all categories of employees and
department are connected in the form of pyramid shape. In this structure the chain of command
is goes from top to down and performance of all employee's supervised effectively by CEO or
manager of company. Due to following this type of structure goodwill of Hyatt hotel is
effectively sustained in long term. The other name of this structure is called hierarchical
organizational structure.
Flat organizational structure is defined as organizations with few levels between lower
and upper level management. In this type of structure, the functions and communications
between departments are worked in the form of horizontal shape. But in this structure the
problem is that due to this type of working procedure Virgin holidays is not able to motivate
their employees at maximum level. Due to this the chances are easily enhanced to organization
for decreasing their productivity at maximum level.

Discuss the different business functions such as human resource management, production,
operation etc. and the impact of their functional management activities on organization and
the people within the organization
Different business functions are -
Human resource management – It is the most essential department within organization
in various aspects. It includes train the employees, maintaining optimum working conditions
providing wages to workers in time etc. Due to conducting all these activities timely and
effectively the all over functions of the organization is going in smooth manner for long time.
Production – It is also the other and important department within company for
facilitating best and standard quality service to consumers in time. With help of this department
organization is able to sustain their dominant position in market and in minds of customers for
long time. Due to maintaining the dominant position their services and products are easily
consumed at maximum level by all customer segments.
Operation – The main role of this department is to maintain effective coordination or
communication between all levels of department (Bican and Brem, 2020). Due to the effective
role of this team organization is able to deliver their quality product and services to customers in
time without any type of delay.
From the analysis of above functions, it concludes that all these activities play the major
role increasing the productivity of hospitality and tourism industry. Because with help of these
activities organization such as intercontinental hotel, Virgin holidays and others are able to
maintain positive relationship with all customer segments effectively. Due to keeping positive
relationship organizations in tourism and hospitality industry are able to identify the desires and
wants customers easily within low time. With help of sustaining good relationship tourism
industry is able to increase their profit at maximum level.
Define organizational culture and explain how positive culture impacts on the success of
organization
Organizational culture is basically referring to the positive working environment which is
provided by top level management to the employees. Therefore, positive working environment is
highly essential for increasing the performance level of employees at higher rate. In today's time
travel and tourism is growing day by day because young generations are highly liked to travel in
many places and also liked to taste unique food. All these leads to increase the popularity of this

industry at higher rate. Due to keeping effective organizational culture the respect between all
levels of departments are effectively sustained in long term (Contu, 2020). With help of effective
positive culture firm always facilitates right information’s and offers regarding their services and
products to customers in time. In this way the overall success rate of the organization is
effectively sustained for long duration.

CONCLUSION
After the analysis of above data, it concludes that in hospitality and tourism industry
plays the important role for sustaining the popularity of various tourist places effectively. In
present time the popularity of the various hotels which is directly connected with tourism
industry are increasing day by day. Because in this area customers are highly interested for
availing different types of services which includes staying in hotels rooms, trying different types
dishes, booking tickets for travelling etc. Due to consuming this types of services by customers
at high rate, productivity and profit of this industry are easily increased at maximum level. With
help of providing good service to users the goodwill of the organization is effectively sustained
in long term.

REFERENCES
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