Understanding Business Organization: Structure, Functions, and Impact

This report provides a comprehensive overview of business organizations, defining them as legal entities focused on profit generation through various activities like production and sales. It explores different business types, including sole proprietorships, partnerships, and limited liability companies, highlighting their strengths and weaknesses. The report emphasizes the importance of organizational structure in achieving business goals, discussing hierarchical and flat structures and their impact on communication and decision-making. It also examines key business functions such as human resource management and operations, along with the significance of a positive corporate culture in enhancing employee productivity and loyalty, using Tesco as an example. The report concludes that choosing the right business format and maintaining a positive work environment are crucial for success in a competitive market.

Understanding
Business Organization

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
A company can be defined as a legal entity involved in a particular business, such as
industry, commerce, marketing, production, or buying or selling goods or services. It's main
purpose is to generate profits and income. There are many types of business owners, including
partners, sole proprietors, and limited companies, all with their own strengths and weaknesses
(Ahmad and Murray, 2019). An organizational structure is known as a system or framework that
involves operating a business to achieve a given goal and purpose with the aim of generating
profits. The organizational structure is adopted according to the business activity and its nature.
There are two types of store structures: high structure and flat structure. There are various
operations performed by an organization, such as management, production, and human
resources. These resources are defined in the task of systematically achieving the defined goals.
There are many values and ethics associated with the corporate culture that have a positive
impact on a company's performance. This report describes the strengths and weaknesses of these
industries, organizational structures, and operational functions performed by the business
organization. This report also discusses industry practices and the concept of organizational
culture.
MAIN BODY
There are many activities that companies carry out with the primary purpose of making a
profit. These activities can be the production and sale of goods and services. These activities are
carried out to meet the needs and desires of our customers (Anshari and Sumardi, 2020). There
are many types of businesses run by an organization, which differ in the nature of the business
and its characteristics as a sole proprietorship, partnership, and limited liability company.
Soletrader is a company with a simple working structure and all activities are carried out by one
person or people. Sole trader is the person who makes all business decisions. The retail structure
is simple, quick to make decisions, and low setup costs. There are also some disadvantages
associated with being a sole proprietor as a business owner, with unlimited liability, limited
financing, and high obligations and responsibilities to be fulfilled. A partnership can be referred
to as a business or arrangement between two or more individuals or companies that agree to
manage and operate to achieve a particular given goal and purpose. In partnerships, debt and
profits are shared among all members. Partnerships also have certain advantages in terms of ease
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of formation, flexibility, risk sharing, and division of labor among all partners, which further
expands the scope. It has unlimited longevity debt, so there are some drawbacks associated with
it.
Organizational structure is known as a structural form or framework that helps and guides
business activities in a systematic way to achieve a given goal and purpose. Also, explain roles
and responsibilities with the various departments of the business and ensure that there is a clear
communication flow. If the business orgaisation have a clear business structure, the business will
function properly. Adopting the most appropriate business structure is important because it helps
to make quick decisions, improve business operations, reduce employee conflicts, and improve
the performance level of all employees (Chawla, 2020). An effective business structure also
builds a strong communication system with a well-defined hierarchy level organization to bring
the proper functioning of the business. Hierarchical, flat, functional, and matrix business
structures are the types of business structures that exist in the market. When there are different
leaders and levels within an organization, it is called a large corporate structure. It has a long
chain of commands and a top-down approach. This organizational structure has a small number
of subordinates and employees, and the management scope of the manager is narrow. In a large
business structure, the communication process is long as long as all information and
communication goes through all the elements of the business command chain. This large
corporate structure is followed by Tesco, which is made up of various parts and departments to
ensure that work is done effectively. A flat organizational structure, on the other hand, is a
horizontal business structure with less management hierarchy (Kumaresan and Liberona, 2018).
The range of control is wide, and the subordinates are also in the upper ranks. Nike has a flat
organizational structure that provides overall performance. This business structure has a short
communication structure that helps Nike achieve all previously set goals effectively and
efficiently with faster decision making. There is more autonomy among administrators.
Business functions and operations are activities performed within an organization that
aim to achieve set goals and objectives in the right way. There are many core activities
performed within the company, such as marketing, resource management, operations, and
finance, all of which directly or indirectly affect business operations.
Human Resource Management is responsible for human resource management within
the organization. Recruitment and selection of candidates, training and development programs,
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and many other tasks that meet the requirements of that particular position are carried out by
human resource development. HR also improves employee productivity, along with the design of
compensation systems, employment contracts, and many other features that help improve
employee performance and productivity (Osafo, 2022). Another important function of the
business is to convert raw materials into finished products. Sainsbury's has a large independent
department for efficient operations. The production department maintains the production level
and quality of the product to achieve efficiency and ensures that the right resources are properly
placed and available during production. In addition to this, various operations such as marketing,
finance, and accounting functions are performed to improve the sales and profitability of the
business. The Treasury department reviews all business transactions and records them along with
the allocation of funds to various business departments.
The organizational culture is known as all these different policies and practices,
techniques and tactics, along with different values and beliefs that provide appropriate guidance
to all employees and help them accomplish their set tasks. .. The main sources of information are
employee codes of conduct, company characteristics and ethics, and various property rights.
Organizations need an effective business culture that helps them achieve their business goals and
objectives and retain effective trained employees within the organization (Wirani, Hidayanto,
and Shihab, 2020). A positive business environment leads to growth and development along with
business culture. The involvement of top-level managers improves employee productivity, role
satisfaction, and loyalty to the business organization. Tesco also has a positive business culture
that is supportive and allows it to occupy a different position in the market, giving it a number of
competitive advantages.
Tesco cares about employee well-being by creating a department dedicated to all issues,
handling and resolving issues. It also motivates employees and strengthens their loyalty to the
company over the long term. In a positive business environment, employees feel comfortable and
motivated, which also leads to increased profits and sales in the organization's market. Tesco is
team-oriented and has a unique organizational culture to encourage and guide innovation and
provide quality products to our customers. We also seek the growth and development of our
employees at the personal and professional level. Tesco also has an excellent employee
appreciation team that pays dividends and focuses on the well-being and growth of employees in
the organization.
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CONCLUSION
From the above report, we can conclude that the company is a legal entity involved in the
right direction and the implementation of various operations that lead to the achievement of
certain goals and objectives. There are different types of businesses, such as sole proprietorships
and partnerships. Companies need to choose the most appropriate business format to help them
guide the way and run in the right direction. Maintaining a business structure is important to the
business organization as it helps the management in making effective decisions. In this highly
competitive business environment, it is important to maintain a positive work environment.
Because it motivates and improves the work and function of employees. A positive business
environment also helps improve overall productivity and company profits.
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REFERENCES
Books and journal
Ahmad, M.U. and Murray, J., 2019. Understanding the connect between digitalisation,
sustainability and performance of an organisation. International Journal of Business
Excellence, 17(1), pp.83-96.
Anshari, M. and Sumardi, W.H., 2020. Employing big data in business organisation and business
ethics. International Journal of Business Governance and Ethics, 14(2), pp.181-205.
Beynon-Davies, P., 2021. Business analysis and design: understanding innovation in
organisation. Springer Nature.
Chawla, P., 2020. Impact of employer branding on employee engagement in business process
outsourcing (BPO) sector in India: mediating effect of person–organization fit. Industrial
and Commercial Training.
Kumaresan, A. and Liberona, D., 2018, August. A Case Study on Challenges and Obstacles in
Transforming to a Data-Driven Business Model in a Financial Organisation.
In International Conference on Knowledge Management in Organizations (pp. 263-276).
Springer, Cham.
Osafo, E., 2022. Using human anatomy and physiology to explain business organisation
effectiveness. International Journal of Business and Systems Research, 16(2), pp.259-
276.
Wirani, Y., Hidayanto, A.N. and Shihab, M.R., 2020. Factors affecting acceptance of internet
banking with technology-organisation-environment framework: a perspective of
corporate customer in Indonesia. International Journal of Business Information
Systems, 34(4), pp.560-593.
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