Business Environment Task 1: Types and Scope of Organisations

This report, Business Environment Task 1, explores various types of business organisations and their respective scopes. It begins by differentiating between public, private, partnership, sole trader, and charity organisations, detailing their structures, objectives, and funding sources. The report then delves into the size and scope of each organisation type, highlighting how factors such as goals, objectives, products, and mission influence their operations. Public organisations, with large scopes and government-defined goals, are contrasted with private entities focused on profit generation. The report also covers the unique characteristics of charity, sole trader, and partnership firms, including their vision, mission, and legal structures. The report concludes by referencing relevant academic sources that support the analysis. This report provides a comprehensive overview of the business environment and its diverse organisational structures.

BUSINESS ENVIRONMENT
TASK 1

P1 Different types and purposes of
organisations
■ A business organisation can be of different types. They all are having different size and scope.
The nature of business determine its size and scope. Also, legal structure differ to a great extent.
■ There are various types of organisation. They all have to follow legal structure as per their size.
These organisations are described below :-

CONT..
■ Public organisation – They are formed by government in order to provide basic services to
people. They are completely regulated and operated by government. In this the role of public and
government is defined by legal structure.
■ The main objective of public organisation is not to earn profits but to provide basic amenities to
people.
■ Government is responsible for providing funds to it. The size of operations depend on whether it
is formed by state or central government

CONT..
■ Private organisation- On the other hand private organisation are formed by individuals or group
of persons. There main objective is to earn profits by providing services and products to people.
■ In this also the legal structure depends on size and scope. Private companies have to follow
certain rules and regulations that has been set by government. This ensures that they work
accordingly.
■ The funding of private organisation is done by issuing IPO. The maximum number of people
that can involve in starting private firm is 50.

CONT..
■ Partnership – They are formed by either merging to two companies or mutually starting of
business by two or more persons.
■ The minimum number of people in this can be 2 and maximum are 20. The funding of partnership
is done by capital invested by persons. Also, before starting partnership, a partnership deed is
required. It is an agreement between parties.
■ It defines the roles and responsibilities of each partner

CONT..
■ Sole trader – As the name suggests these type of business is owned by single person but it can be
transferred to other person. These business usually operates in small area as they are having low
capital.
■ Due to large number of small and medium size business, competition among them is very stiff.
These business are formed with intention of earning profit

CONT..
■ Charity – Usually they are NGO whose main objective is to provide basic services to society in
order to raise their standard. They identify problems in society and then work on it.
■ There motive is not to earn profit but to improve the living standard of people. In most of the
cases funding is done by government or business.
■ There growth and development is dependent on rise in level of community.

P2 Explain the size and scope of different
types of organisations
■ Every organisation that is described above differ in size and scope. This the main factor that helps
in distinguishing between them. According to size and scope, goals and objectives are developed.
Also, several things are considered in this such as products, mission and vision, etc. It is briefly
described below :-
■ Public organisation- Generally, the size and scope of public organisation is very large. It is
because it operates in overall economy. Also, the goals and objectives defined are very specific.
■ In this the goals are decided by government that what they have to do

CONT..
■ Private organisation- the goals and objectives of private organisation are decided by owners of
company. They motive is to earn huge amount of profits by providing products and services to
people.
■ A private organisation can also expand their operations in different countries.
■ Charity- they are formed especially to improve the living standard of society. They help in well
being of people by providing them services.
■ The services include health care, education, etc. their vision and mission is based on their
services

CONT..
■ Sole trader- In this the goals and objectives are determined by owner of business. These goals
basically contains profits earning and expansion of business.
■ The mission and vision of business depends on capital invested in it.
■ Partnership- the goals and objectives of partnership firm is mutually decided by the partners that
are involved in it. Also, mission and vision is developed by board of directors of the enterprise.
■ The legal structure of partnership organisation is very complex. It is because it is dependent on
partnership deed and roles of partners.

REFERENCES:
Bah, E.H. and Fang, L., 2015. Impact of the business environment on output and productivity in
Africa. Journal of Development Economics, 114, pp.159-171.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and sustainability in
the age of globalization. Oxford University Press.
Menychtas, and et.al, 2014. 4CaaSt marketplace: An advanced business environment for trading cloud
services. Future Generation Computer Systems, 41, pp.104-120.
Wetherly, P. and Otter, D. eds., 2014. The business environment: themes and issues in a globalizing
world. Oxford University Press.

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