Analyzing Business Organizations: Structures and Environments

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BUSINESS AND BUSINESS ENVIRONMENT

Table of Contents
TABLE OF FIGURES.....................................................................................................................3
INTRODUCTION...........................................................................................................................4
LO1..................................................................................................................................................5
P1 DIFFERENT TYPES OF ORGANISATIONS AND THEIR LEGAL STRUCTURES.......5
P2 SIZE, SCOPE AND RANGE OF DIFFERENT ORGANISATIONS...................................8
M1 SCOPE, SIZE AND STRUCTURE OF ORGANISATIONS AND THEIR LINK TO
PRODUCTS AND SERVICES OFFERED AND BUSINESS OBJECTIVE OF THE
ORGANISATIONS...................................................................................................................11
LO2................................................................................................................................................12
P3 FUNCTIONS OF ORGANISATION AND THEIR INTERRELATIONSHIP WITH
EACH OTHER AND THEIR IMPACT ON ORGANISATIONAL STRUCTURE................12
M2 ADVANTAGES AND DISADVANTAGES OF INTERRELATIONSHIP BETWEEN
FUNCTIONS OF ORGANISATION AND ITS IMPACT ON ORGANISATIONAL
STRUCTURE:...........................................................................................................................14
LO3................................................................................................................................................15
P4 AND M3 POSITIVE AND NEGATIVE EFFECT OF MACRO ENVIRONMENT ON
BUSINESS:...............................................................................................................................15
LO4................................................................................................................................................20
P5 AND M4 SWOT ANALYSIS OF JCB AND OXFAM INORDER TO FIND THE
STRENGTHS AND WEAKNESSES OF THE ORGANISATIONS.......................................20
P6 INTERRELATION OF STRENGTHS AND WEAKNESSES WITH FACTORS OF
MACRO ENVIRONMENT......................................................................................................23
CONCLUSION..............................................................................................................................24
REFERENCES..............................................................................................................................25

TABLE OF FIGURES
Figure 1: TYPES OF BUSINESS ORGANISATION....................................................................5
Figure 2: ORGANISATIONAL STRUCTURE OF JCB..............................................................12
Figure 3: PESTEL ANALYSIS.....................................................................................................15
Figure 4: SWOT ANALYSIS........................................................................................................20

INTRODUCTION
For the establishment of a successful business, a suitable business environment is very necessary.
Business environment consists of all the internal and external factors that affect the business. The
factors that can’t be managed by the authorities of business are called external factors of the
business environment (Hamilton and Webster, 2018). In this report, three different sectors of
business organisation are explained in detail. Three different organisations are taken under each
sector and their background, size and scope, legal structure and key stakeholders are described.
Different functions of an organisation and their interrelationship with each other and the impact
of this interrelationship on the organisational structure of the organisation are discussed in detail.
A pestel and swot analysis is also done on one of the organisation to find the negative and
positive effects of macro environment on the organisation and also to find out the internal and
external factors which affect the business such as strengths, weaknesses, opportunities and
threats (Prajogo, 2016).
The three chosen organisations are Cabinet Office, JCB and Oxfam each from public, private and
voluntary sector respectively. These organisations are analysed in detail.

LO1
P1 DIFFERENT TYPES OF ORGANISATIONS AND THEIR LEGAL
STRUCTURES
Private, public, and voluntary sectors are three different sectors of business organisations. These
organisations are also called profit, non- profit and non-governmental organisations respectively.
These organisations and their legal structures are explained in detail below:
Figure 1: TYPES OF BUSINESS ORGANISATION
Source: (Prajogo, 2016)
PRIVATE SECTOR ORGANISATIONS
These are called private organisations because these organisations are run by people with the sole
aim of profit-making and are not controlled and owned by the government. Private sector
organisations are managed, controlled and owned by people and therefore also called the citizen
sector. A large number of employees work in the private sector with the aim of making money
(Means, 2017).

Legal structures of private sector organisations are:
Sole proprietorship: These types of businesses are run and controlled by individuals. These are
an unincorporated business with unlimited liability. The business and the owner are not a
separate entity in the eyes of law.
Partnership: when two or more people come together to do business that form of business is
called partnership. All the partners in business have limited liability except for the fact if there is
an unlimited liability partnership. This is also an unincorporated business (Means, 2017).
Limited company: limited companies are of two types, public limited companies and private
limited companies. Limited companies and their owners are separate entities in the eyes of law
and limited companies can purchase assets and bear losses in their names. These are incorporated
businesses (Means, 2017). The members of limited companies have limited liabilities and have
to bear the losses and enjoy profits according to their share percentage in the company. Public
limited companies can exchange their shares at the stock market whereas for buying private
company's share, there should be the owner's consent (Means, 2017).
PUBLIC SECTOR ORGANISATION
Public sector organisations are called non- profit organisations because these are government or
state-owned companies with the objective of providing benefits to people. These types of
organisations are either set up as a part of the government or by passing an act or normally under
company act. Government is the major shareholder in the public sector organisation with 51% or
more shares (Rosenbloom et al., 2017).
Legal structures of public sector organisations are
Departmental undertakings: these are the part of the ministry of government and the revenue
generated from such organisations is a part of government treasury and their budget originates
from the legislature (Kearney, 2018).
Statutory corporations: these are government organisations set up by acts passed by the
government. These organisations are fully controlled by the government but can be financed

from other sources and the revenue generated from such organisation is reinvested for future
developments (Rosenbloom et al., 2017).
Government organisations: these organisations are established under the company act of 2013
and follow all the rules and regulations under the company act. The government have maximum
shares that are 51% or more in these organisations and these are separate legal bodies and are set
up with commercial objectives (Kearney, 2018).
VOLUNTARY SECTOR ORGANISATION
Voluntary sector organisations are umbrella bodies which are non-governmental organisations
established with the aim of helping people. These types of organisations are set up to raise social
issues and for the betterment of society. These work for the causes like reducing poverty, helping
poor, spreading education, women equality, etc. (Mellor, 2018).
Legal structures of voluntary organisations are:
An Unincorporated Association: when few people come together for similar causes such as
helping poor or helping disaster victims, such associations are called unincorporated
associations. This type of association has unlimited liability. Generally, all the legal works are
done on the name of one member (Milligan, 2017).
Trust: A trust is set up with serving a particular cause in mind. The trust is concerned with three
types of people, those who donate in the trust, those who maintain the trust and those who are
benefitted from the trust. The trustees have unlimited liability and there is generally no structure
in the trusts (Mellor, 2018).
Limited company: the companies set up under the company act which has a separate legal entity
and all the members have limited liability. The companies are limited either by guarantee or by
shareholders (Milligan, 2017).

P2 SIZE, SCOPE AND RANGE OF DIFFERENT ORGANISATIONS
There are three different types of organisations which are taken here; those are Cabinet Office,
JCB and Oxfam. These organisations are analysed in detail below:
JCB
Background details: The name JCB stands for J.C. Bamford Excavators Limited, which was
kept on the name of the founder Joseph Cyril Bamford. JCB was founded in 1945 and still
owned by the Bamford family. It was started from a garage that was purchased by Joseph
Bamford and turned into one of the largest machinery manufacturing firms in the world today,
manufacturing all sort of machinery for construction, waste-handling, demolitions and other such
activities (JCB, 2019).
Size and scope: JCB is the large sector British manufacturing firm that has its plants in India,
Germany, Australia, China, CIS and North and South America. There are around 12000 workers
under JCB. The company sells its product in over 150 countries and manufactures around 300
types of machinery. There is a great scope for JCB in future due to its innovative approach of
business with high use of technology and great distribution services, the company is soaring in
the market (JCB, 2019).
Mission and vision: the mission and vision of JCB are to provide new global value to JCB, and
make its product and services innovative and reach customers worldwide and provide better
goods and services to achieve customer loyalty and satisfaction (JCB, 2019).
Legal structure: JCB is a private limited company and has many joint ventures with other
companies in order to expand its business worldwide. The ownership of the company is in the
name of the Bamford family. The members of the company have limited liability (JCB, 2019).
Key stakeholders: the key stakeholders of JCB are its customers, suppliers, shareholders,
employees of the company. The customers play a major role in deciding the future of the
company by buying its products and services. The key stakeholders of JCB play a major role in
the growth of the company (JCB, 2019).

CABINET OFFICE
Background details: Cabinet office was formed in December 1916, and is headquartered in 70
Whitehall, London. It is a department under the government of the UK to support the Prime
Minister and other members of Cabinet ministry (Aylett, 2017).
Size and scope: it has around 2000 staff members mostly working in Whitehall, the staff
working for Prime Minister also form part of Cabinet Office. It is a well- respected organisation
and many important details of the UK government are handled by it (Baker, 2017).
Business objective: the main objective of Cabinet office is to support the Prime Minister and
other Cabinet Ministers to form various policies according to law and to serve the society and to
uplift the third sector and support the people (Aylett, 2017).
Legal structure: it is the departmental undertaking under the UK government and is part of the
government. It helps in the working of government and the budget of the Cabinet Office is
decided by the UK legislature (Baker, 2017).
OXFAM
Background details: Oxfam was formed with the collaborations of 19 different charity
organisations in order to support the victims of natural calamity and to reduce world poverty and
curing hunger. In 1942, a famine relief committee was established with the group of social
activists and other people; this committee was later developed as a large non- governmental
organisation named Oxfam International. It has a limited liability by guarantee and there are two
boards i.e. Board of Supervisors and Executive board (Hajnal, 2018).
Size and scope: It is a collaboration of 19 charity organisation making it a large global non-
governmental organisation. It works in around 90 countries providing hunger relief and
livelihood. Oxfam works for the eradication of poverty and to help the victims of natural
calamity all over the world (Petit García, 2017).
Mission and vision: Oxfam is the charity organisation that works for the elimination of poverty
by providing resources to the poverty-stricken people. Oxfam believes that world poverty can be

reduced with the will of people and appropriate support of the government. It has the vision to
provide a safe and secure livelihood to all people as it is their universal right (Rosche, 2016).
Key stakeholders: key stakeholders of Oxfam include all the people affected by it such as
suppliers and donors, the beneficiaries, government, private organisations, academic
organisations, shareholders and partners, etc. (Petit García, 2017).

M1 SCOPE, SIZE AND STRUCTURE OF ORGANISATIONS AND THEIR LINK
TO PRODUCTS AND SERVICES OFFERED AND BUSINESS OBJECTIVE OF
THE ORGANISATIONS.
JCB is a large firm with the aim of profit-making and global expansion. With the large size and
many joint ventures, JCB has expanded globally. Its size and scope have helped JCB to achieve
its business objective. It is a manufacturing firm and provides its product in almost around 150
countries. Its legal structure provides an opportunity for more funds to expand the business (JCB,
2019).
Cabinet Office is a departmental undertaking and a part of the UK government. Its large size and
scope the organisation to fulfil its business objective i.e. to facilitate the office of Prime Minister
and other Cabinet Ministers (Aylett, 2017).
Oxfam is an umbrella organisation and its business objective is to serve society and reduce social
issues. Its large size enables it to provide help worldwide and its wider scope reaches to the
needs of all. The legal structure of Oxfam and its size and scope enables it to fulfil its business
objective (Petit García, 2017).