Understanding Different Types of Functions and Structures of Organisations

This assignment report covers various types of business organisations, their legal structures, purposes, scope, and interrelation between organisational functions and objectives.

UNDERSTANDING DIFFERENT
TYPE OF FUNCTIONS
AND STRUCTURES OF
ORGANISATIONS

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Mention various purpose and types of private, voluntary and public sectors along with
their legal structure......................................................................................................................1
P2 Discuss about scope and size of various kind of business organisations...............................4
TASK 2............................................................................................................................................5
P3 Mention the relationship between organisational functions and the way they are related
with organisational structure and objectives...............................................................................5
TASK 3............................................................................................................................................7
P4 Acknowledge the negative and positive influence of macro environment on business
operations including examples....................................................................................................7
TASK 4............................................................................................................................................9
P5 Carry out external and internal analysis of a business firm to acknowledge its weaknesses
and strengths................................................................................................................................9
P6 Mention how the weaknesses and strengths have interrelation with the external and
internal factors ..........................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Organisational function is referred as a core procedure or a set of various activities which
are performed by the departments in a business firm. These functions include IT, marketing,
customer service, warehousing, financing etc. organisational structure is basically a system
which outlines the manner in which through with activities and operations are carried out so that
organisational goals can be attained (Clarke, Li and Xu, 2016). This assignment report is
performed in context with British Airways which is one of the biggest UK airline, headquartered
in Harmondsworth, UK. In terms of passenger carried and fleet size, this organisation is second
largest UK airline. This assignment report is going to cover about varied kind of business firms
along with their different legal structure and purposes. After this, size and scope of different
business firms is discussed and role of organisational interrelationship is carried out. Also, macro
and micro business environment is investigated so that weaknesses and strength associated with
a business are carried out in a proper manner.
TASK 1
P1 Mention various purpose and types of private, voluntary and public sectors along with their
legal structure
In general, all the business organisations are divided into three kinds i.e. voluntary,
private and public organisations. companies operating in different sector have their own mission,
purposes and legal structures which differentiate them from other business firms. In this context,
types and purpose of different sector organisation are stated below:
Public Sector Organizations: This sector of business firms comprises of those
organisation which are managed, run, owned and financed by the government authorities and
their officials. Main purpose of public companies is to provide welfare and support to common
people so that they can earn a good livelihood. For instance, NHS which is public organisation
offering health care service to people. Purpose: The major purpose behind these firms is to
provide high quality care to the people in UK so that they can sustain a good life (Deasy and et.
al., 2016).
National health service
 Product and services: This organisation offers health benefits and associated care
service like eye care, medical care etc. to their customers.
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 Size and scope: This business firm have around 200 health centres and clinics within UK
and these centres are managed by more than 1 million service providers. Scope of
company is very broad as they spends around 116 billion pounds every year to serve
needy persons.
 Vision and mission: Vision of company is to offer free health facilities and treatment to
the common people and their mission is to provide good health to all the people in UK.
 Business objective: This company has the objective to offer emergency treatment to the
common people so that they can live disease free life without worrying about financial
issues.
 Stakeholders: Service providers, patients, investors and local community are their main
stakeholders.
Legal structure:
 Central government: This governmental tier collects funds from people in the form of
taxes. This kind of government have the accountability of entire nation (Deshpande,
2018).
 Local government: These government authorities gather funds from people in the form
of council tax and they have the jurisdiction to resolve and manage all the affairs
associated with cities, local area, towns etc.
 State government: This government authority have the power and jurisdiction to
manage overall affair of a state. This government tier is accountable to central
government for their actions.
Private sector organisations: These business organisations are set up, operated and
managed by individuals on private basis. This type of organisations can either manage their work
through partnership or on individual basis. One example in this context is British Airways which
is a UK based flag carrier airline, offering their services in global manner. Purpose: Major
purpose of these organisation is to attain maximised revenues and sales so that they can became
market leader in their respective field.
British Airways
 Product and Services: This company provides airline services to their customers in
global context.
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 Size and scope: Fleet size of firm is 279 and it provides its services for 183 destinations
which shows their size of company is big. As this company operates globally and earns a
revenue of more than 13,000 million pounds each year, scope of organisation is big.
 Vision and mission: Vision of firm is to became market leader in field of airlines and
associated service. Mission of firm is to provide high quality service to their customers.
 Business Objectives: Main objective of firm is to acquire maximised profits so that they
can gain business advantage over rivals in a productive manner (Erasmus, Strydom and
Rudansky-Kloppers, 2016).
 Stakeholder: Stakeholders for British airlines are their employees, suppliers, investors,
managers and other people which are related with organisation.
Legal Structures:
 Sole proprietorship: In this legal structure, an individual set up, manage and run entire
business on individual basis. All the revenues, profits and risks associated with this
business are managed by a single individual only. In order to operate as a sole proprietor,
an individual needs license from local authority.
 Partnership: In this kind of business, two or more individuals operates and manage their
business by carrying out investing in business. Shares of all the partners can be different
and associated risks & profits of business will be distributed among them as per their
investment in business. In case of legal obligations, they follow same rules as sole
traders.
 Limited Company: To become a limited organisation, organisations requires to register
themselves as either public or private limited. Profits linked with these businesses are
share by shareholders as per their shares. These organisations pays corporate tax
according to the earned profitability. For instance, British Airways (Evans and et. al.,
2017).
Voluntary organisations: These business organisations involves an association of
different people that came forward to work together with the aim of serving people. These
companies are funded by government for their activities and operations. One instance in this
context is OXFAM. Purpose: Main purpose of these organisation is to provide good quality
services and facilities to the residents of near by areas & other needy people so that each
individual can spend a healthy life.
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OXFAM
 Product and Services: This firm provide health benefits to the people which are
traumatised by natural disasters, poverty etc.
 Size and scope: Organisation provide their service in more than 94 countries and
engaged more than 2000 local partners to provide their service to people. This shows size
of company is high. Scope for firm is wide as around 50,000 volunteers are engaged with
firm to support their business activities.
 Vision and mission: Vision of firm is to eliminate poverty in global context. Mission of
Oxfam is to serve each people which is getting impacted by natural disasters and poverty.
 Business Objectives: To provide comfortable life to people free from issues like poverty.
 Stakeholders: Staff members, suppliers, trustees and volunteers of company are their
major stakeholders.
Legal structure:
 Trust: These kind of firms are not a legal entity which means that these organisation do
not prefer to enter any specific agreement and serve the customers as per their targets.
Oxfam which is a voluntary organisation came under this legal structure (Grewal and et.
al., 2015).
 Association: These organisation also do not come under legal entity but they have an
agreement and perform their work until they achieve a specific and common goal behind
serving people.
P2 Discuss about scope and size of various kind of business organisations
Small organisation: These type of organisation posses limited growth and scope as their
business is managed at very small scale. These companies hire less than 60 workers and earn
revenues less than 9 million. Main objective of these companies is to earn stable sales so that
they can enjoy a healthy living lifestyle. Market share of these companies are very limited and
their profit shares depends upon their overall revenues. In order to grow their businesses, these
organisation work hard to increase their operability scale. For example, New London Cafe.
Medium organisation: Size of these business is limited and their scope is moderate as
they operates in a specific region only. These firms hire less than 280 workers and earns a sales
of around 50 million pounds per annum. Main objective of these firms is to expand their business
so that they can reach to the level of large scale organisations. Profit and market share of these
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organisations are high as they have the motive to became market leader in respective region. To
achieve growth, these companies prefer innovative ideas and techniques. For instance,
Rowlinson Knitwear (Hillary, 2017).
Large organisation: These kind of business organisations needs heavy investment and
human power as their size and scope is unlimited. This is because these companies perform their
work in global context. These organisations have more than 280 employees and earn higher than
50 million pounds every year. Profits and market share of these companies is very high and to
sustain a high growth these companies, operate and targets global audience. For instance, M&S.
TASK 2
P3 Mention the relationship between organisational functions and the way they are related with
organisational structure and objectives
Organisational functions includes the set of business operations and activities which are
performed within a business firm. Basic type of organisational functions are human resource,
finance, marketing, IT, production, sales etc. Interrelation in different functions of an British
Airways and their relation with objectives and structure is mentioned below:
 Marketing and finance department: Marketing team in a business firm have the
responsibility to carry out market research so that needs and opinions of people can be
identified. Finance team of a company have the role to delegate funds and finances to the
marketing team so that they can perform their work in a proper manner. In return,
marketing team helps them in finding investors so that British Airways will not face
shortage of revenues. Hence, these departments are needed to work together. If these
departments will not operate in united manner, marketing team will not get requires
capital to perform work and finance team will be short of money. This will leads to
disruption in smooth working of organisation.
 Finance and HR department: Role of finance function is to deal with funds and
finances of company and prepares an appropriate budget so that all the activities of
organisation can be performed in an estimated capital. HR function of a firm have the
role to hire, select and train workforce so that these employees can perform their
departmental work in a proper manner. In order to perform their work, HR team in
British Airways requires a proper budget which is allotted by finance team and in return
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of this HR department hires skilled employees that work in finance team and allow the
department to achieve their target. Hence, these departments works in interrelation and
without working together, HR team will not get appropriate funds to recruit talented
employees and finance team will not have skilled workforce to perform work (Huang and
et. al. 2013).
 HR and marketing department: HR department in British Airways recruit right persons
which work in marketing department and overall activities of considered department are
carried out in a productive manner. If Human resource team will not perform their work
efficiently, unskilled employees will be hired that will be unable to perform
organisational work. Also, marketing team promote the organisational vacancies due to
which large number of people came and apply for the job. Due to this HR team is able to
selected desired candidates. In this way, these departments perform work in coordination
and helps the organisation in gaining high revenues and profits in a proper manner.
Advantage and disadvantage of interrelation among organisational function
Advantage: Due to good interrelation among organisational functions like HR,
marketing, finance, sales, IT etc. all the work of a company can be carried out before deadlines.
This will help the firm in performing complex work in a simplified manner so that organisational
efficiency can be reduced. By this, company will attain high revenues and profits.
Disadvantage: There are some disadvantages which are related with the good
interrelation among organisational functions. Due to good relation in different departments like
finance, HR, production etc., they will be more reliable on one another and feel reluctant in
showing their actual working potential. Due to this, efficiency of British Airways can be
compromised and overall profits of company may suffer.
Link of business functions with organisational objectives
If all the functions in an organisation will be able to perform their work in a proper
manner, complex situations can be handled and managed through efficient means. For example,
if marketing team will perform their work in efficient manner, this will helps the finance team,
production team, finance team and sales team to carry out their respective tasks in a timely and
strategic manner. By this, overall revenues and sales of organisation will enhance. This will
further helps the company in achieving their objectives and targets in a proper manner without
any difficulty (Khan and Quaddus, 2015).
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Linkage of organisational function with organisational structure
Organisational structure of British Airways is divisional in which different functions of a
company are divided into regional or product divisions. These divisions can be carried out either
in context with geography or any other criteria. Different divisions in British Airways are
provided requires functions and resources so that they can perform their work without any
interruption. This means that each division posses separate finance, HR, marketing, sales, IT and
R&D department so that all the divisional work can be performed without any shortcoming. This
kind of organisational structure is very useful for a large scale organisation like British Airways
as facing failure at single division is not going to impacts the overall profitability and
performance of company. But, there is one disadvantage of this divisional structure that they can
involve operational inefficiencies which are very different from specialised functions. Also, this
structure can increase taxes of company.
TASK 3
P4 Acknowledge the negative and positive influence of macro environment on business
operations including examples
In order to identify the negative and positive impact of macro environment on business
activities and operations of British Airways, PESTLE analysis can be used. This analysis will
help the company in analysing those external factors that can impacts a firm in a considerable
manner. PESTLE for British Airways is discussed below:
 Political factors: BA is one of the biggest international airline which provide fleeing
services at more than 400 geographic destinations in global context. Aspect like political
stability and safety of people is essential political factors for British Airways.
Government in UK is highly stable due to which regulations for Airline service do not
change often. Also, government support this sector as it helps in generating huge
revenues. This aspects favour British Airlines but due to Brexit, political stability has
faced some setbacks which can impact concerned company in negative manner.
 Economic factors: Aspects like currency exchange rates, inflation rate, interest rates and
other economical elements has an important impact on the working of British Airways.
People in UK have economic stability due to which they can afford transportation via
airlines. This factor is in favour of BA sales. Also, reduce rate of oil in UK impact
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company in a positive manner. After great recession of 2018, inflation in UK has
increased which can impact organisation in negative way.
 Social factor: This element of PESTLE analysis is related with the perception, opinion,
value, choice and preference of people which are residing in a geographic region. People
in UK are modern and open minded due to which they are habitual of vacations and trips.
Due to this, scope of British Airways in UK is high. This impacts the concerned
organisation in a positive manner. But, preference of people in UK changes at a fast
pace. In future if they avoid travelling via planes, this will impact the revenues and sales
of BA in negative manner (Kozubíková, Homolka and Kristalas, 2017).
 Technological factor: These kind of factors are associated with the technological
advancement of a company to attract maximum number of customers. UK is treated as
one of the most advanced country where people prefer high technology services so that
they can save their time. In this context, BA is needed to update their machines and
technology on regular basis so that customers can be served and treated in a proper
manner. It will influence the business operations of company in affirmative way.
 Legal factors: The legal aspects are associated with the legal norms, procedures and
regulations of the nation in which they are operating. Legal laws in UK are very strict and
it is important for business organisation to follow them in a proper manner otherwise they
may have to pay high fines and penalties. Laws related to airline sector are very strict but
favours concerned companies. This will influence BA positively but if company will not
be able to serve their customers as per regulations then victims can file a lawsuit that will
degrade the reputation of organisation in negative manner.
 Environmental factors: These aspect are based on environment, ecology and preserving
nature so that all living beings can live a healthy life. In this context, government of each
country have formulated some environmental laws that must be abided by the respective
organisations to operate in a region. In case of UK, each company has to prepare
environmental assessment report in which company will shows that their activities are not
harming environment in any way. Air planes are operated on fuels which degrade
environment. This aspects impacts BA in negative manner but as company maintains
their air planes on regular basis, impact on environment is less. This elements is in favour
of company.
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TASK 4
P5 Carry out external and internal analysis of a business firm to acknowledge its weaknesses and
strengths
To acknowledge strengths and weaknesses of an organisation in a proper manner, SWOT
framework can be utilised by the manager in British Airways. This framework will help the
concerned firm in acknowledging their positive aspects along with those elements which are
needed to be changed. SWOT on British Airways is stated beneath:
Strengths Weaknesses
 This company has more than 90 years
of experience in their field due to which
they have greater knowledge in serving
the customers as per their requirements
(Wetherly, 2014).
 Company have their own engineering
branch so that their aircraft and fleets
can be maintained properly. Due to
this, aircraft of company receive
regular maintenance and trust of
customers for services of company is
very strong.
 One of the biggest advantage of British
Airlines is its over dependence on UK
market for their revenues and sales.
Due to this, organisation do not try to
increase their global presence.
 Company has a big unionised
workforce. Due to this, collective
bargaining form employees take place
regularly. This reduces the overall
performance of employees which
impact organisational productivity in
negative manner.
Opportunities Threats
 In order to further improve their profits
and revenues, company can increase
their presence in Asian Market like
China, India, South Korea etc. These
markets have high scope for British
Airways in terms of profit.
 Organisation can increase their online
 Other airlines are offering same kind of
service in less amount due to which
customers can tilt towards other firms.
This will bring a big threat towards the
sales of company.
 Airline sector is highly regulated due to
which they are needed to perform every
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presence where loyal customers of
company will be given vouchers. By
this, more people will interact with
company and their customer base will
hike.
work in a cautious manner. In case they
do not comply with government then
British Airways will have to pay heavy
fines and taxes.
P6 Mention how the weaknesses and strengths have interrelation with the external and internal
factors
Political factors: Political scenario in UK is in the favour of aviation and airline
industry. Government interference is not so high and most of the policies favour organisation and
its activities.
 Strengths: BA has near about 100 years of experience in working in UK due to which
compiling with UK political scenario is very easy for them.
 Weakness: As this company is very dependent on UK market, changing of political
scenario of UK will create issues and threats for British Airways.
Economic factors: This type of factor depends upon purchasing power and growth rate
of a nation. UK has high GDP and economic growth due to which operating in UK is
economically beneficial for British Airways (Burns and Dewhurst, 2016).
 Strengths: Main business of company is operated in UK due to which sales and revenues
of organisation are high and stable.
 Weakness: Union labour of company favours regular negotiations related with wages.
This can reduce the efficiency of company.
Social factors: It is linked to the choice and opinion of people operating in UK. If change
and perception of people changes, it will impact concerned company in a considerable manner.
 Strengths: To gain the interest of customers and provide them security, company
maintains their air planes and controlling machines on regular basis.
 Weakness: Company do not try to allure the people of other country and nations, if
interest of UK population in company will reduce. This will impact the company and its
working in negative manner.
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Technological factors: These aspects are concerned to technological advancement so
that an organisation can interact and communicate with their customers in efficient manner
(Fayolle and Gailly, 2015).
 Strengths: This will help the company in dealing with complex situations in a timely
manner.
 Weakness: Due to more dependence on technology, confidential information is shared
which can be easily hacked by rivals.
CONCLUSION
As per this discussed assignment, it can be comprehended that to acquire high revenues,
company is needed to sustain an appropriate working environment. There are varying kind of
business organisation which operates in different sectors like voluntary, public and private
section. Business firms have different size like Small, large and medium size and their scope
depends upon their operability. To achieve high revenues, it is essential for organisational
functions to work in a collaborated manner. By taking the help of frameworks like SWOT and
PESTLE, macro and micro environment of business can be identified properly. Interrelation in
Micro and macro factors helps a business firm in acknowledging strengths and weaknesses
related to their business.
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REFERENCES
Books and Journals
Clarke, G., Li, Y. and Xu, L. C., 2016. Business environment, economic agglomeration and job
creation around the world. Applied Economics. 48(33). pp.3088-3103.
Deasy, S. and et. al., 2016. Controlling use of a business environment on a mobile device. U.S.
Patent 9,247,042.
Deshpande, A., 2018, November. Technology neutrality as a practice: A discussion of two UK
interventions on broadband and associated outcomes. In 2018 11th CMI International
Conference: Prospects and Challenges Towards Developing a Digital Economy within
the EU (pp. 1-6). IEEE.
Erasmus, B., Strydom, J. W. and Rudansky-Kloppers, S. eds., 2016. Introduction to business
management. Oxford University Press Southern Africa.
Evans, S. and et. al., 2017. Business model innovation for sustainability: Towards a unified
perspective for creation of sustainable business models. Business Strategy and the
Environment. 26(5). pp.597-608.
Grewal, R. and et. al., 2015. Business-to-business buying: Challenges and
opportunities. Customer needs and Solutions. 2(3). pp.193-208.
Hillary, R. ed., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Huang, H.C. and et. al. 2013. Overcoming organizational inertia to strengthen business model
innovation: An open innovation perspective. Journal of Organizational Change
Management, 26(6). pp.977-1002.
Khan, E. A. and Quaddus, M., 2015. Examining the influence of business environment on socio-
economic performance of informal microenterprises: content analysis and partial least
square approach. International Journal of Sociology and Social Policy. 35(3/4). pp.273-
288.
Kozubíková, L., Homolka, L. and Kristalas, D., 2017. The effect of business environment and
entrepreneurs’ gender on perception of financial risk in the smes sector. Journal of
Competitiveness.
Wetherly, P., 2014. The business environment: themes and issues in a globalizing world. Oxford
University Press.
Fayolle, A. and Gailly, B., 2015. The impact of entrepreneurship education on entrepreneurial
attitudes and intention: Hysteresis and persistence. Journal of Small Business
Management. 53(1). pp.75-93.
Burns, P. and Dewhurst, J. eds., 2016. Small business and entrepreneurship. Macmillan
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