Analyzing Business Organizations: Structure, Scope, and Objectives

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Business and business environment

Contents
Introduction......................................................................................................................................2
LO1..................................................................................................................................................2
P1.................................................................................................................................................2
Different type and purpose of the organization.......................................................................2
P2.................................................................................................................................................4
Explain the size and scope of a range of different types of organizations..............................4
M1................................................................................................................................................5
Analysis of how the size, structure, scope of the business organizations link to the business
objectives and products and services offered by the organization..........................................5
LO2..................................................................................................................................................6
P3.................................................................................................................................................6
Explanation of the relationship between different organisational functions and how they link
to organisational objectives and structure................................................................................6
M2................................................................................................................................................8
Advantages and disadvantages of interrelationships between organisational functions and
the impact that can have on organisational structure...............................................................8
LO4..................................................................................................................................................9
P4.................................................................................................................................................9
The positive and negative impacts the macro environment has upon business operations,
supported by specific examples...............................................................................................9
M3................................................................................................................................................9
Apply appropriately the PESTLE model to support a detailed analysis of the macro
environment within an organization........................................................................................9
LO4................................................................................................................................................12
P5...............................................................................................................................................12
Conduct internal and external analysis of specific organisations in order to identify strengths
and weaknesses......................................................................................................................12
P6...............................................................................................................................................14
Explain how strengths and weaknesses interrelate with external macro factors...................14
M4..............................................................................................................................................15
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Apply appropriately swot/tows analysis and justify how they influence decision-making...15
Conclusion.....................................................................................................................................16
References......................................................................................................................................16
2

Introduction
There is a different type of business organization exist in a business environment they are
different in terms of their nature, size, organisational structure, scope and purpose. The business
environment is shaped by different internal and external factors (Eși, 2014). In this report the
discussion will be done on a different type of business organization by highlighting their size and
scope along with this there is core relationship exist between a different functional unit of an
organization that will be discussed by linking it with the organisational structure of a business.
Further, this report is going to analyze the impact of different external micro and macro
environment factors on business functions by using proper pestle analysis and internal and
external analysis of 2 organizations will be done by conducting their SWOT analysis will help in
identifying their strength and weakness that relates with the macro environment factors.
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LO1
P1
Different type and purpose of the organization
A business organization is formed by a person or a group of people by using the legal framework
of the government. The business organizations can be owned privately or publically depends
upon the purpose of the business. All the business organizations want to achieve some kind of
profit by providing their offerings into the market. Some types of business organization are as
follows:
Figure 1 types of business organisation
Source: (Author’s work, 2019)
Private sector
these organizations are established by the companies and individuals who aim at profit-making
from conducting business activities and there is no government involvement in the private sector
as they owned privately (Arellano et al., 2013). The private sector organizations are employing
more than public sector workers and they are giving their big contribution to the economic
development of the country. These organizations can be established by forming a new enterprise
or privatization of a public organization. Some type of private sector organization is a
partnership, sole proprietorship, small, medium and large companies etc (Christensen et al.,
2014).
Example
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Types of
business
organisation
private sector public sector voluntary
sector

Virgin Atlantic Airways Ltd is a British private sector company with its head office in Crawley
UK and providing its airline services across the world. The company has generated a revenue of
£2,688 million and was employing 8875 employees in 2016.
Public sector
These organizations are run and governed by the local, regional or national government. The
government has full control over the operations of public sector business. public companies
provide their services to the general public. The funding for public sector organization is raised
by fees, taxes and public shares (Christensen et al., 2014). Sometimes there is joint ownership
can be seen between public and private sector organization through signing a private-public
partnership contract. Public transport and government health organization are the types of the
public sector (Rashid and Rashid, 2012).
Example
The British broadcasting cooperation is a British public broadcasting service provider and it is
considered as the world's oldest broadcasting public organization. it is employing a larger
number of people in the organization with its headquarter in London. It is providing radio and
web portal services across the world.
Voluntary sector
Voluntary sector organizations are those organizations which do not aim at profit-making and the
owners of a voluntary organization focus on social benefit rather than self-interest. In a voluntary
organization, people join each other on a voluntary basis and share their resources to form a
business organization with the aim of providing social services (Schneider and George, 2011).
They provide support to the society and its people through maintaining their wellbeing.
Charities, foundations are the type of voluntary sector organization (Osborne, 2013).
Example
British heart foundation is a Uk based charity organisation. this organization is providing help to
those who are suffering from heart-related disease and they also help in determining those risk
factors which may result in serious heart decease. This organisation is serving a large number of
the public with its services.
P2
different types of organizations according their size and scope.
There are many different types of business organization which are consist of different size and
there scope and purpose are also different. The size of an organization can be termed as the total
numbers of employees are in it and scope can be termed as the extent to which a business is
providing its services. The size and scope of various organizations can be discussed as follows:
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Sole proprietorship
In this type of organization a single person own and run business activities to achieve some profit
from the market in the exchange of services. Its scope is limited to a specific geographical area
as they serve a limited market. For example grocery stores
Partnership
In the partnership, two or more people join each other to establish a business organisation and
they share their resources to earn a profit. Their scope is wide in compare with sole properties as
they put combined efforts to grow business.
Small size organization
Small businesses are employing less than 10 employees and serving a community of a specific
geographical area but they are giving their contribution to economic development (Davies and
Crane, 2010).
Medium size organization
They are employing less than 50 employees and more than 10 employees in the organisation by
operating their business at a medium scale. They do not have access to the large market like a
small business (Hillary, 2017).
Large cooperation
In this type of organization, large numbers of employees are working and providing their
services to the customers. Large cooperation usually handled by the government and they work
for public welfare. There is scope is wide as they are serving to a large community group (Witzig
et al., 2012)
Pvt Ltd Company
Private ltd companies are employing at least 50 people in the organization. To become a private
Ltd company it needs to get registered under the company act of the UK. The organisation
required to follow the legal framework determined by the government.
Public Ltd Company
It is employing more than 50 employees and various shareholders in it. The public Ltd Company
is governed by the full government support and the company need to strictly follow the legal
procedure and policies. This kind of companies is providing public services and utilities.
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M1
the size, structure, scope of the business organizations relates to the business
objectives and its offerings.
A business organization is formed to achieve some objectives of the owners and they sell their
products and services to fulfil business objectives. The size, scope and organisational structure of
an organization are highly contingent upon the goals and services provided by the organization.
for example, a small business like a grocery store is formed to fulfil the family need of the
owners and for that purpose, they sell daily needs products to the customers. The size of a
grocery store is small because only one or two employees can work under it and there is no
organisational structure can be organized as numbers of employees are less so there is no need of
dividing author and responsibility of the different task (Wynarczyk et al., 2016). The scope of
this small organization is limited to a specific geographical area where it is selling its products
while the large organization operates their business at the large scale and the numbers of
employees are also large in that organization. the scope of large cooperation is wide as they have
access to a large market. Large cooperation is aim at gaining a higher market share with higher
profit and sale a large number of services to the public.
Hence, it is clear that the objectives and products or services provided by an organization decide
its structure, size and scope in the market because they correlate with each other. The firm's
objectives help in determining how will be the structure of an organization and how many
employees are needed in the organisational as well as its scope in different geographical market.
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LO2
P3
The relationship exist between different organisational departments and their link
to organisational structure and objectives
The different organisational functional unit interrelates with each other because all the business
functions are done to achieve common objectives of the business. the structure of an organization
divides different tasks into a different functional group (Alber and Klaas, 2012). The
organisational structure of an organization helps in determining what task will be done by to
whom to achieve their business objectives in an effective manner. there are many kinds of
business function operated in an organization like marketing, production, human resource
management etc (Fisher et al., 2012). an effective organization structure divides an organization
into different functional units to attain business goals successfully. The organisational structure
of Virgin Atlantic is presented as follows.
Figure 2 organisational structure of Virgin Atlantic Company
Source: (Fisher et al., 2012)
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Finance
The finance department of virgin Atlantic group is handling all the finance-related tasks of the
organization. they are responsible for generating an annual financial statement and also store all
the financial data of the company. Finance is transferred in different functional units of the
organization to accomplish business goals effectively. The finance department coordinates with
all functional units of the organization (Alber and Klaas, 2012).
Human resource
This functional unit of the organization ensures that there are adequate supply and demand for
human resources in the Virgin Atlantic organization. The main task of the HR department is to
increase organisational performance by increasing the performance of the employees. When
finance and other department require human resources they take help from the HR department
and the HR department acquires and transfers human resources in different organisational units
(Ramanadham., 2019).
Marketing
The marketing function is operated by the marketing manager of the Virgin Atlantic company.
This functional unit of an organization deals with the selling, advertising and different
promotional strategy of the services. This functional unit establishes good relation with the
human resource function to get the most suitable candidate for the marketing team and takes help
from finance functional unit when they require a budget for marketing (Alber and Klaas, 2012).
Research and development
This is the most innovative area of virgin Atlantic organization which deals with the new product
development by conducting market research. Market analysis is done by the researchers and they
help in generating a new idea for the company. Market analysis requires a huge amount of
finance so they have to coordinate with the finance functional unit of the organization and
researchers are hired by the human resource unit of the organization (Maduenyi., 2015).
IT department
Being an airline industry the role of IT plays a big reality in the success of Virgin Atlantic
organization. The IT department of the company maintains the important data of the company by
using digital technology. IT department also required skilled IT expert and with the help of
human resource unit the vacant post can be fulfilled. Bringing new technologies in the
organization requires.
Hence, different units of the organization are separated into a single department and they play
their own job role on an individual basis but also establish coordination and collaboration with
each other to achieve business goals successfully.
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M2
Disadvantages and advantages of interrelationships between organisational
departments and its impact on organisational structure
Advantages
Attainment of the common goals
The ultimate aim of the functioning of the different organisational unit is to achieve the common
business objective of the organization which is decided by the top management of the Virgin
Atlantic group. Mutual understanding and good relationship between them helps in attainment of
the business goals (Maduenyi., 2015)
Increment in organisational performance
The performance of virgin Atlantic group can be increased through improving the performance
of the different functional unit and the relationship between different functional unit helps in
achieving overall organisational performance (Maduenyi., 2015)
Effective collaboration and cooperation
The interrelationship between each other results in establishing cooperation and collaboration
among a different functional unit of the Virgin Atlantic group (Lambert et al., 2010).
Disadvantages
Conflict and disputes
Conflict and dispute may arise between employees of the different organisational unit due to
disagreement upon any decision and that reduces the productivity of the Virgin Atlantic
organization (Maduenyi., 2015)
Segregated
Segregation can be done on the basis of a task assigned to a particular group and that result in
dissatisfaction among the employees because all the employees are divided into a separate group
and they don't get chance to establish communication with each other (Lambert et al., 2010).
Hence, the interrelationship of different departmental units of the organization may impact the
organisational performance in a negative or positive way through its advantages and
disadvantages.
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LO4
P4
Positive and negative effect of the macro environment on the business operations
The macro environment is formed and shaped by those external factors which are out of control
of an organisation and possessed by the external business environment of the company. Today in
the world of contemporary business environment the competition is very high and the external
factors affect the operation of a business at a large scale (Yang et al., 2014). Positive aspects of
these factors may provide advatanges to the organisation while the negative impact may reduce
the performance of the organisation in the world. The positive impact of these factors may
provide strength to an organisation an can enable its effective decision making while the negative
impact may become a weakness for the organisation and company will have to make changes in
its work method, procedure and strategies (Bosdriesz et al., 2012)
For example, there are some political, legal, economic, environmental, technological, social and
cultural factors are present in a business environment of the Virgin Atlantic group and BBC
organisation which has impact upon the business operations in a high manner and the companies
have little or no control over these factors (Itani and Mason, 2014).
M3
Application of PESTLE model to analysis of the macro environment factors within BBC
and Virgin Atlantic organization.
Pestle analysis includes the analysis of the external environment of the business by focusing on
the different external factors and that helps in identifying the internal and external impact of
these factors on the business (Rastogi et al., 2016).
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