MGBBT0UBN: Understanding Business Organisations and Environments

This essay provides a comprehensive analysis of business organizations, exploring various types such as sole proprietorships, partnerships, and limited companies, along with their respective advantages and disadvantages. It assesses different organizational structures, including functional, divisional, and matrix structures, highlighting their impact on business operations. The essay also examines key business functions like human resource management, production, and operations, emphasizing their influence on organizational performance and the workforce. Furthermore, it discusses the significance of organizational culture in fostering a positive work environment and driving business success, using Starbucks as an example. The report concludes that understanding business organization principles is crucial for satisfying customer needs, maximizing profitability, and achieving sustainable growth in the marketplace.

Understanding Business
Organisation

Table of Contents
Introduction .....................................................................................................................................1
Main Body.......................................................................................................................................1
Conclusion .....................................................................................................................................5
References ......................................................................................................................................6

Introduction
The term business organisation is defined as the process of analysing and evaluating how
business organisation are structured also it leads them to achieve desired goals and objectives.
Business organisation are incorporated in order to maximise their profitability and satisfy the
needs and wants of the target customers through offering them quality goods and services. It is
considered to be effective when there positive culture supported with effective structure and
strategy (Bäckström and Mosleh, 2021). This report highlights the detailed analysis of the
various business types along with their advantage and disadvantages. Also various organisational
structure are also highlighted along with the various business functions such as human resource
management, production, operations and so on and their impact on organisation and the people.
In addition to this the organisational culture and its impact on the success of the business is also
highlighted in this report.
Main Body
Discuss the advantage and disadvantages of various kinds of businesses
Business organisation is defined as the legal corporate entity started with the aim of
offering quality goods and services to the target customers and maximising the profit. The
business organisation helps in analysing how the business organisation are structure effectively
and also how this leads them to achieve desired goals and objectives (Irwin, 2020). There are
different types of business organisation such as sole trader, partnership, limited company and
cooperation, all the different types of business along with their advantage and disadvantages are
mentioned below:
Sole trader is the first type of business organisation is the sole trader, these type of
business are started by the single entrepreneur with very small amount of capital. All the
business activities are owned and managed by the owner himself even he is the only one
responsible for the overall profitability and risk incurred. These business are mostly owned and
carried out by sole trader specially for their own advantage (Jafari-Sadeghi, 2020).
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Advantage
All the business activities or operations are owed and managed by the owner himself
All profit incurred is subject to the owner
Very less amount of capital required to start the business
Disadvantages
Sole trader is the one liable for all the debts
In this kind of business the equity is limited to the sole traders resources
It is very difficult to transfer the ownership
Partnership business organisation are started by through the mutual agreement between
two or more partner to effectively carry out all the activities together. All the profit earned and
the risk incurred within the business is equal divided among both the partners equally as per the
partnership deed. Also the important decisions are taken with the mutual consent among the
partners (Long, 2018).
Advantage
Total profit is shared among the partners equally
Sharing of the resources helps in offering more capital to the organisation
All the important decisions are taken with mutual consent
Disadvantages
Both the partners are equally responsible for all the debts and losses
These kind of organisation comes to an end if the one of the partner decides to leave
These type of business are also difficult to be sold out
Limited liability company is the another type of the company is the limited liability
company, these type of company started with large amount of capital. These are owned and
managed privately, with the main aim of satisfying the needs and wants of the customers through
offering them quality goods and services and also maximising their profit (Lysons, 2020).
Advantage
In case of these type of business the liability is limited to the owners
The aim is to maximise the profit
These type of business also enjoy the tax advantage
Disadvantages
In case of limited liability company the ownership is limited
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The agreements included is complex
Requires large amount of capital to start these kind of business.
Assess and compare organisational structures
Organisational structure is defined the system used by the business organisation in order
to direct the activities and offer clarity of roles and responsibility among the employees which
will automatically leads them to achieve desired goals and objectives. It also helps in effective
flow of required information within various level of the business. In order to effectively compare
and contrast the organisational structure the business organisation needs to analyse the
organisational charts, it helps in analysing the flow of information, communication,
accountability and so on. Also the structure are also grouped on the basis of the functions. It is
analysed that one organisation may divide their department or unit as per the functions carried
out whereas the other organisation may divided department through grouping the people by the
products produced by them (Mitra, 2019). Grouping also helps in determining the kinds of
organisational structure used by the business organisation. In addition to this proper evaluation
and analysis of the organisational types also allows the business to select the suitable structure
for them. Such as the functional structure depends on the job specialisation, rules and a proper
management hierarchy. Whereas the divisional structure determines the client, product and
services division so as each and every person works towards achieving desired goals and
objectives. The matrix structure is carried out with the functional structure and then determines
the divisional that allows the members from various other units. Whereas the team structure
refuse any kind of transferring power to the employees team. Comparing the functional structure
and the teams organisational chart allows the business to analyse the vertical points to the
functional structure, thus team structure looks relatively flat. Comparing various organisational
structure allows the business organisation to analyse their functioning which leads them to
effectively use it and enhance their overall performance (Morgan-Jones, 2018).
Assess various business functions and impact of their functional management activities on
organisation and the people
The business functions is are the various essential activity taken into consideration by the
business organisation to effectively and smoothly carry out their work. There are number of
business functions taken into consideration by the business such as the human resource
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management, production and operations activities directly influencing the organisation
performance and workforces.
Human resource management is one of the most essential function carried out by the
business organisation, it helps in analysing the requirement of the human resource in each and
every department of the business. And as per the requirement it hires the right candidate for the
right job with required skills and capabilities also. This also involves motivating, compensating
and training employees, motivating employees towards achieving the goals will helps in
enhancing the overall profitability and productivity of the business (O'Dwyerand Gilmore,
2018).
Production department is responsible for ensuring that quality products are produced as
per the taste and preference of the customers and also to satisfy their needs and wants effectively.
Production department deals analysing the needs in the market and accordingly converting the
quality inputs into the output effectively. This functions helps the business organisation to offer
quality goods to the target customers which will automatically help them to enhance their
profitability (Whitingand Martin, 2020).
Operations department is one of the most essential department of the business
organisation which ensures that each and every operations of the business is smoothly carried in
the business effectively. This functions of the organisation allows the organisation to handle the
business operations which will helps them to achieve desired goals and objectives (Saxena and
Lamest, 2018).
Explain organisational culture and assess how positive culture impact on the success of the
business
Organisational culture is defined as the kind of culture prevailing in the business which
helps in leading and promoting positive and structured workplace environment which helps the
employees to be motivated towards achieving desired goals and objectives and leading business
towards success. Effective shared values, effective degree of hierarchy including the clarity of
role and responsibility among the employees and also effective flow of communication between
the top management and employees leads to determining positive organisational culture in the
organisation. Positive culture prevailing in the business environment helps motivating employees
towards achieving desired goals and objectives which will automatically lead the business
towards growth and success. Effective organisational culture also promote effective
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communication in the organisation and also offering employees to have clarity of their roles and
responsibility (Suhartanto, 2019). For example Starbucks company's positive culture lead the
business towards continuous growth and success. For example the company has allowed their
employees to offer free drinks or coupons if the customers comes with any issues. Satisfying the
target customers allows the company to enhance their performance in the marketplace and gain
competitive advantage. This also leads business towards continuous success also. Culture plays
an essential role in the overall growth of the business through maintaining positive workplace
environment effectively (Viswanadham, 2018). It also allows the business organisation to
promote effective flow of communication among the employees which will allow them to have
clarity of their roles and responsibility. Organisational culture is the main driving force behind
the success and growth of the business.
Conclusion
From the above report it has been analysed that business organisation help in satisfying
the needs and wants of their target customers through offering them quality goods and services, it
is also analysed that these business organisation are started with the main aim of maximising
their profitability in the marketplace. This essay report helps in analysing various types of
businesses such as sole trader, partnership, limited company and so on along with their
advantage and disadvantages. Various organisational structures such as functional, divisional and
matrix structure are also analysed in this report. In addition to this different business functions
like human resource management, production and operations and how they impact the
organisation and its people are also analysed in this essay report. It also analysed that
organisational culture plays an essential role in the growth and success of the business
organisation.
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References
Books and Journals
Bäckström, I. and Mosleh, W.S., 2021. The inclusive organisation: Management practices of
employee-driven innovation (EDI). International Journal of Innovation Management,
p.2150068.
Irwin, H., 2020. Communicating with Asia: Understanding people and customs. Routledge.
Jafari-Sadeghi, V., 2020. The motivational factors of business venturing: opportunity versus
necessity? A gendered perspective on European countries. Journal of Business
Research, 113, pp.279-289.
Long, S., 2018. The perverse organisation and its deadly sins. Routledge.
Lysons, K., 2020. Procurement and supply chain management. Pearson UK.
Mitra, J., 2019. Entrepreneurship, innovation and regional development: an introduction.
Routledge.
Morgan-JoDisadvantagesnes, R., 2018. The body of the organisation and its health. Routledge.
O'Dwyer, M. and Gilmore, A., 2018. Value and alliance capability and the formation of strategic
alliances in SMEs: The impact of customer orientation and resource
optimisation. Journal of Business Research, 87, pp.58-68.
Saxena, D. and Lamest, M., 2018. Information overload and coping strategies in the big data
context: Evidence from the hospitality sector. Journal of Information Science, 44(3),
pp.287-297.
Suhartanto, D., 2019. Predicting behavioural intention toward Islamic bank: a multi-group
analysis approach. Journal of Islamic Marketing.
Viswanadham, N., 2018. Performance analysis and design of competitive business
models. International Journal of Production Research, 56(1-2), pp.983-999.
Whiting, F. and Martin, M., 2020. Human resource practice. Kogan Page Publishers.
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