Business Organisation Analysis: Types, Structures, Functions, Culture

This report provides a comprehensive overview of business organisation, starting with a definition of business and a comparison of different business types (sole trader, partnership, limited company), outlining their advantages and disadvantages. It then compares and contrasts various organisational structures, including hierarchical, functional, divisional, and matrix structures. The report further discusses different business functions such as purchase, productivity, distribution, and accounting, and their impact on functional management activities. It defines organisational culture and explains its positive impact on the success of an organisation. Finally, it discusses examples of industry practices from different organisations like TESCO and ASDA, highlighting their unique approaches to culture and structure. The report concludes that understanding the business environment is crucial for successful operation and effective implementation of business functions.

UNDERSATNDING
BUSINESS
ORGANISATION

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
1. Defining business and outlining three advantages and disadvantages of the different types of
business........................................................................................................................................3
2. Comparing and contrasting different organizational structure................................................5
3. Discussing different business functions and their impact on the functional management
activities within organization.......................................................................................................6
4. Defining organizational culture and explaining the positive culture impact on success of
organization..................................................................................................................................7
5. Discussing examples of industry practices from different organization.................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................1

INTRODUCTION
Business is an entity engaged in commercial, industrial and professional activities. It is
the prominent activity involved in making one's living or making money by producing and
buying the good, services. The main aim of a business to produce and distribute the goods and
services for satisfying the needs and demands of people. Business can be Sole proprietorship,
partnership, corporation, cooperative, franchises, non-profit, also small and large scale
businesses. Business is extremely important in the economy as it affects the daily lives, work,
spending, saving, investing, travelling. It also influences the jobs, incomes, opportunities for the
personal development.
This project will give the details about understanding the business environment through
comparing the similarities and dissimilarities of different types of business. Comparing the
organizational structures of business. Discussing different types of business functions, defining
the organizational culture and the positive culture influence the success of organization. Lastly,
discussing various example of retail industry from different organization.
MAIN BODY
1. Defining business and outlining three advantages and disadvantages of the different types of
business.
Business is defined as an organization which is engaged in the Commerical, industrial
and professional activity. Generally designed for the profit and no profit purposes which may or
may not have a separate existence from owners controlling it. The fundamental work behind the
business model is plan, vision, mission are developed based on the concept related to production,
buying and selling of the goods or services. The work is performed by satisfying the customers
with the aim of achieving the profit.
Sole trader
Sole trader is business entity which is owned and controlled by a self-employed individual, this
business does not have the legal entity separating from the owner of the business (Rye, 2020).
The owner has the absolute control over the business assets and profit after tax.

Advantages of sole trader Disadvantages of sole trader
 Sole trade business are easy in
formation and winding up.
 Quick decisions can be taken by the
owner of the business and efficient
actions are performed.
 Simple and inexpensive in nature.
 Limited resources are available, as it is
self owned by individual.
 Unlimited liability of the owner during
the financial crises.
 The scope of growth and future stability
is very limited.
Partnership
It is the formal arrangement by two or more parties for operating the business and sharing the
profits termed as partnerships. There are two forms of partnerships mainly the general (it is like
sole proprietorship more than on owner) and limited (where all the partners are liable to pay the
limited liability).
Advantages of partnership Disadvantage of partnership
 Partnership business is easy to form , as
involving very minimum legal
procedure.
 It is very flexible business.
 Easier to raise funds, as combines
capital.
 Partnership business have unlimited
liability.
 Quick decision-making in the business
is not possible.
 Partnership dissolved when other
partner dies.
Limited company
Limited company is the general form of business organization here in the assets and the income
of the owner are separate form the business, known as limited liability.

Advantages of limited company Disadvantages of limited company
 Limited company have Separate legal
entity with ownership structure.
 Limited company are taxable at lower
rates.
 Taxable reliefs are also available to the
corporates (R&D relief, amortization)
 Difficult in raising the capital, mainly
procurement of equity and debt.
 No perpetual existence of the company.
 Complex in formation, and faces
difficulties due to different state laws.
2. Comparing and contrasting different organizational structure.
There are different organizational structure being followed in the organizations mainly consists
of functional, divisional, hierarchical and matrix structures.
Hierarchical organizational structure : This organizational structure consist of various
layers of the management which uses the top to down bottom approach. In this organizational
structure the critical decision are made by the senior managements which are then passed on to
the subordinates. It is the pyramid shaped chart where every business entity except one,is the
subordinate to the single other entity (Walker, 2021). The managers in this structure have the
narrow span of control and relatively small number of subordinates.
On the other hand in the functional organization structure the business employees the
personnel with the speciality, skills and other abilities. Mostly, corporate businesses operates In
the functional structure because it groups the individuals with the similar knowledge and then
utilized in a team which helps corporate business to achieve the goals and objectives.
In the Divisional organizational structure groups each organizational function into
division. This organizational structure is useful as the failure of one division does not affect the
other divisions. In this structure the company division have the control over its own resources,
which are operating in the organization. It is mainly the parallel division where the company is
responsible fir the product and service, geographical location and customer group (Cohen,
2018). These structures help large companies for staying flexible, also promotes the
independence, quicker response can be gained by the changes in the industries.

On the contrary in the Matrix organizational structure it combines the functional and
divisional structure. In a matrix structure, The employees are accountable to more than one boss
where company usually follow two separate chains of command. This structure is designed for
partially impermanent. This structure creates the partnerships and focuses on the minimizing the
cost by sharing the key people (Berniak-Woźny and Szelągowski, 2021). Matrix structure
provides greater visibility, stronger governance, and more control in large and complex
companies.
3. Discussing different business functions and their impact on the functional management
activities within organization.
Different business functions being performed in the organization are as follows
Purchase functions
This function is concerned with acquiring the goods ad services for organization. The
materials required for the production of the commodities must be procured on economic terms
and must be utilized on the efficient manner for achieving the maximum productivity.
Productivity function
This function lay a dominant role in performing the business activities. Production
involves heavy investment in the fixed assets and the working capital. The production cycle in
the business mainly depends on the marketing function as the production of goods and services is
justified when they are resulting in the revenues through sales.
Distribution function
It is the process of making the product or service available for the customers and the end
users. Distribution function is diversifies function which mainly involves the customer service,
shipping, warehousing, inventory control.
Accounting function
The main purpose is to provide the financial information to the investors, creditors. This
function helps in summarizing, and measuring the activities of the businesses and further
communicate the result to the other parties.
The following functions will impact the business organization directly and indirectly , as
the purchase function will directly impact on the business inventory control and the management
for accurate stock level. The productivity impacts on the functional management as higher the
productivity leads to higher the income, which allows the businesses to enjoy more leisure time

and better services (Types of Business Functions, 2021). Accounting function directly impact in
analysing the financial information and helps in overseeing the monetary transaction.
4. Defining organizational culture and explaining the positive culture impact on success of
organization
Organisational culture is the personality of the organization which comprises the
company mission, objectives, expectations, values, and guides the employees of the company.
This culture consist of the shared beliefs, and values being established by the leaders and then
communicated through the various methods, which ultimately helps in shaping the employees
perception, behaviours, understanding. For instance the culture of the large, profit corporation
will be quite different from the hospital (Imron and et.al., 2021). The culture can be recognized
by the arrangement of the furniture, equipments, members of personnel working and the clothing
style.
A strong positive culture impact the business success in many ways:
Positive culture will help in differentiating the business in the market place, as with the
strong culture helps the corporate business for standing out among the competitors of the
crowded field. Also, with the strong corporate culture will help in attracting the clients, partners
and the employees. The positive organization culture will also help in creating the healthy team.
Stress leads to unhealthy team and unhappy employees, which increases the healthcare costs and
productivity issues for the business. Also, with the strong corporate culture will help in
emphasizing the employee wellness as part of overall culture. Positive culture will help in
improving the productivity where the heathy culture cultivates the workplace for the employees
have the higher job satisfaction.
5. Discussing examples of industry practices from different organization.
Organizational practices helps in improving the workflows and guides in decision-
making process. Industry practices help in overcoming the team barriers of ambiguity, as by
having the clear culture which unifies the employees and improves the organizational structure
further help the employees in working together and building team for achieving the particular
purpose. Examples of different retail industry for following the different culture and practices
includes: TESCO, company follows the culture in which employees can thrive in both
professionally and personally. For working in the best positive environment with the clean,

bright, including top-notch facilities providing to the workforce (Company Culture, 2021).
Company provides the positive and healthy working avenues which helps in supporting the
leadership structure of the industry. The organisational culture being followed in the company
encourages the life balance for the employees and also builds the healthy personal relationships
and a sense of community among the team members. The retail industry also follows the
diversity in the workplace which creates the culture consisting of different kinds of people
working together and thriving in the rewarding and affirming the corporate environment.
Another example of retail industry is ASDA, the company is following the hierarchical
and functional organizational structure. The hierarchical structure have many levels in the
department and the industry also includes different levels with lot of employees working in
different departments. Where the senior manager will be a sole leader and will be followed by
the subordinates in the company. Also, the functional areas in which a company is performing
are the distribution, marketing, customer services.
CONCLUSION
From the project report it can be concluded that business environment is very important
aspect for operating in corporate business successfully. As it helps in making the organization
more realistic and plans for effective implementation of the business functions. Different types of
businesses being operated in the dynamic environment mainly includes the sole trader,
partnership, sole proprietorship . Also corporate business are operated in various organizational
structure considering hierarchical structure where the decisions are made by the top manger ,
sole leaders which is being followed by the other subordinates. The corporate business operates
in various functional and environmental areas considering purchase function, accounting
function, distribution, also the productivity unction these helps in running the organization
properly which further achieves the desired goals of the business.

REFERENCES
Books and journals
Berniak-Woźny, J. and Szelągowski, M., 2021. Business process nature assessment matrix–a
novel approach to the assessment of business process nature. Aslib Journal of
Information Management.
Cohen, R. B., 2018. The new international division of labor, multinational corporations and
urban hierarchy. (pp. 287-315). Routledge.
Imron, M. A., and et.al., 2021. Effect of organizational culture on innovation capability
employees in the knowledge sharing perspective: Evidence from digital industries.
Annals of the Romanian Society for Cell Biology. pp. 4189-4203.
Rye, J., 2020. What is the difference between a sole trader and a limited company?. InSetting
Up and Running a Therapy Business . (pp. 132-134). Routledge.
Walker, R., 2021. Communication perspectives on organizational culture and organizational
identification. International Journal of Business Communication. 58(2). pp.147-151.
Online
Company Culture. 2021. [Online] Available Through:
<https://tescocontrols.com/about-us/careers/your-career-join-in/company-culture/>
Types of Business Functions. 2021. [Online]. Available Through:
<https://businessfinancearticles.org/types-of-business-function>