BTEC Unit 1: Organisational Types, Functions and Structures Report

This report provides an in-depth analysis of organizational types, functions, and structures, focusing on private companies, public companies, and non-profit organizations. The report explores the characteristics of each type, including legal entities, ownership structures, and operational aspects, with specific examples from Hong Kong-based companies like HONG KONG AI JIA and CLP Holdings Ltd. The report examines the interrelationship between various business functions such as production, human resources, accounting, and marketing, and how these functions link to organizational structure. The report also delves into the objectives and stakeholders of different organizations, including their financial goals, operational strategies, and relationships with employees, customers, and communities. The analysis includes a comparison of private and public companies, their access to capital markets, and their approaches to international expansion, including mergers and acquisitions. The report uses the case study of CLP Holdings Ltd to illustrate the functions and contributions of public companies, emphasizing the importance of flexible policymaking and efficient decision-making within a large organizational structure. The report concludes by highlighting the key aspects of organizational design and function in the context of the Hong Kong business environment.

ORGANISATIONAL TYPES,
FUNCTIONS AND STRUCTURES

Contents
Introduction...........................................................................................................................................3
Answer-1...............................................................................................................................................3
Answer-2...............................................................................................................................................7
Answer-3...............................................................................................................................................8
Conclusion...........................................................................................................................................11
References...........................................................................................................................................12

Introduction
The report comes up with classification of organisations, which is based on its structure and
its level of operation. The report has classified the types of companies on the basis of
purpose, legal entity, and right structure. The classified types of organisations are private
companies, public companies, and NGOs (Business guides, 2019). According to the
Ordinance of Hong Kong, the private company has been limited through shares. Moreover,
form of business entities may differ and it may consists of sole proprietorships, partnership,
and company, which has its share capital to conduct trade and business. Shares limit public
companies with its ownership, which is a locally incorporated organisation with number of
shareholders that can be nearly more than 50 (Lin, & Chang, 2018). This type of the company
in which shares and debentures have been offered to public. Medium private organisations,
which achieves appropriate growth in industry to take over the public company only after
expanding the shareholder’s base (Business guides, 2019).
The selected company for analysing structure is HONG KONG AI JIA the company. Further,
there is a proper introduction to different types of companies as private, public and NGOs
with their features. At last, a well-designed organisational chart lay the line of authority and
its control between level of management and different departments. Organisation structure
reflect a proper engagement of people towards their functions such as production, human
resources, accounting, and marketing. There is an interrelationship between departments and
organisational functions (Bliss, Goodwin, Gul, & Wong, 2018).
Answer-1
Individuals and companies operate the private sector rather than government. Private Sector
Company aims to generate profits. A PLC (private limited company) is separate legal entity,
which protects the personal assets of the shareholders from the liability. Shares limit private

holding of the shareholders in the company (Bliss, Goodwin, Gul, & Wong, 2018). On the
other hand, public companies are being listed on the Hong Kong stock exchange limited,
which are subject to follow SEHK rules governing the lists of securities, code of takeovers,
mergers, and share buybacks. The ownership of public companies is highly concentrated and
they are generally based on number of shareholders, which can be more than 50. Non-profit
organisation include Hong Kong Red Cross, Mother`s choice, The community chest of
homes, Society for community organisations, and Asia Art archive. A non-profit organisation
generates its funds through donations, and charities, which relieves poverty, advance religion,
advance education, and other charitable acts (Lin, & Chang, 2018).
Most importantly, it is seen that under the range of public organisations, any freedom is
allowed once it is listed. A listed company not only obtains needed finance with the issue of
public but at last it enjoys better facilities from banks (Ng, Morris, & China, 2019).
Private limited company Public limited company Non-profit organisation
The incorporation of public
company is limited by
guarantee and by shares.
Public limited company has
been limited by number of
shares (Lin, & Chang,
2018).
Most of the non-profit
companies opt for it where
entities follow the steps to
register the company limited
by the guarantee.
A private organisation is set
to conduct small business
operations.
A private company does not
need to encounter the
accounts with company’s
Most of the public limited
organisations are derived
from medium to large
private organizations, which
wish to expand the
investor`s base and increase
There is not involvement of
shares. Non-profit
organisation has the board of
directors, individuals,
corporations, social
secretary, and members (Ng,

registry where it can
maintain confidence
financial conditions.
capital from public. Morris, & China, 2019).
According to the companies
Ordinance of Hong Kong, a
company restrict the right to
transfer shares. It is limited
the number of members to
50 individuals. It prohibits
invitation to public while
subscribing shares in
company.
A public company has the
access capital markets and
offer the shares for sale
through the recognised stock
exchange (Pan, He, Fang,
Yang, & Liang, 2018).
It can issue advertisement
offerings any of the
securities for sale to public
(Esteva, & Zheng, 2017).
Non-profit company is
incorporated without word
“Limited.” The process is
quite long and it depends on
case (Lin, & Chang, 2018).
A private company has to
submit annual final accounts
and have its financial
privacy.
These listed Hong Kong
public limited organisations
are under the public domain,
which are likely to investors.
Non-profit organisation is
easy to set up for the
charitable procedure rather
than funds.
A private limited
organisation offers several
benefits, which includes
limited liability, privacy,
shareholder, non-minimum
authorised capital, and
perpetual existence.
A public company has the
access capital markets and
offer the shares for sale
through the recognised stock
exchange (Pan, He, Fang,
Yang, & Liang, 2018).
It can issue advertisement
offerings any of the
Non-profit company is
incorporated without word
“Limited.” The process is
quite long and it depends on
case (Lin, & Chang, 2018).

securities for sale to public
(Esteva, & Zheng, 2017).
Partnership companies allow two or more people coming together indicates the share
ownership of a particular business. A partnership business enables delegating responsibility
and increasing the capability to increase funds. Partners have been jointly and individually
liable for actions of other partners. Common form of partnership is known as limited
partnership because it offers limited liability. Private companies often seek for more profits
and they often seek for international growth at global level (E-notes, 2020). Private
companies can extend their sales of the existing items and services by identifying new
markets. Businesses have been plaguing for the destabilised fluctuations in markets because
of seasonal changes. By extending their operations at global level, it is important to enhance
potential to expand and achieve growth. Private companies can start its campaign by starting
international business plan to examine needs and set appropriate goals (Esteva, & Zheng,
2017). A private company can expand after issuing its shares through IPO in the international
market. Furthermore, this can be done through asset acquisition, joint venture, and mergers
without creating any other individual business entity. Once Board of directors have agreed.
On the other hand, public company will lead to accomplish and combine under consolidated
management and ownership. Mergers is when two and more organisations to form single
entity through absorption and amalgamation (Esteva, & Zheng, 2017). Amalgamation where
two and more private organisations losing their identity and newly private organisation has
been managed through consolidated assets. Absorption where merger occurs, which
organisation buys the stock of the private company. There is a particular process, which
includes approval by the registrar, conducting of general meeting between shareholders and

board of directors and then extending the operations into the international market after
launching IPO (E-notes, 2020).
Answer-2
Hong Kong Jia Yaun Holdings Ltd is a company, which operates in investment general
trading organisations. The organisation conducts business in Hong Kong. It is a financial and
investment company and conducts asset management. The aim and objective of HONG
KONG AI includes financial objectives in moving in the way of long-term success. Some of
the common business objectives include increasing revenue, retrenching when MNCs face
hardship and finally earn return on investment (Yun, and Chau, Kirkland & Ellis, 2019). The
purpose of the company is to manage funds for organization so that they can make well time
investment decisions through the clients and grow finances in portfolio. Working in the group
of several investors, asset management organisations are quite able to diversify the client`s
portfolio (Nwachukwu, & Chladkova, 2019). The company offers quality works and services,
energy saving focus, and project solution. The company is a publically traded company (CLP
Nuclear investment, 2019). With several sectors to work on through the group of its
stakeholders such as customers, networkers, suppliers, managers, shareholders, investors and
board of directors, and employees (Yun, and Chau, Kirkland & Ellis, 2019).
Other example of the publically traded company include CLP holdings Ltd, which is also
known as China Light and power Co Ltd. It is an electric company in Hong Kong
incorporated in 1901 as Power Company of China (Sovereign HONG KONG, 2019). The
main business activity includes transmission, retailing of electrical items and generation.
Currently it conducts its business in Asian markets. The stakeholder`s objectives of the
company is to the employees, customers, communities, shareholders, business partners and
supplier (Esteva, & Zheng, 2017). The company maintains long term and mutual beneficial
relations. For the shareholders, it continues to maintain long-term stable growth in return on

investment and shareholder value (CLP Nuclear investment, 2019). To earn the acceptance of
communities is important by supporting them in long-term development of communities,
where they are operating. The main goal, aim, and objective of company is to maintain
sustainable development of the communities, which operates by availing affordable and
reliable electrical settings to the customers with its minimal impact. In a sustainable way, it
wants to become responsible and provider of its services in Asia (CLP Nuclear investment,
2019).
Bung enterprise Ltd. is an electronic private limited organisation based on Hong Kong, which
provides products such as controversial backup and development for videogame consoles that
allow users to play games. The products offered by the company include Game Doctor, GB
Xchanger, Professor SF, Neo Flash Linker, and Doctor V64 (Sovereign HONG KONG,
2019). Stakeholder group includes managing director, training professor, agencies,
community partners, and customers. The company aims to cater older audience, attack the
competitive market, and aggressive advertisements (Yun, and Chau, Kirkland & Ellis, 2019).
Hong Kong Red Cross is a type of aid agency and non-profit organisation. It aims to protect
the lives, care for health vulnerable people, and finally respect human dignity. The
endowment covers public and private donations with the volunteering of 22580 (Hong Kong
Red Cross, 2019). The company aims to provide range of services to take care of
underprivileged people by availing those services such as children in medical check-ups,
disasters in neighbouring regions, sending relief forces, and to the ageing population (Hong
Kong Red Cross, 2019). The major stakeholders, which avail events such as first aid
competition, nursing competition, drill competition, international friendship day, and world
first aid day. The stakeholders are people, who will delegate services and needy people will
get the services (Chión, Charles, & Morales, 2019).

Answer-3
Among all the three companies, the selected company is CLP holdings Ltd, which is a public
company. It has important functions and contributions towards the country. The functions
indicate that public companies are established to avail essential services such as postal
services, electricity and water services at the reduced cost (Nwachukwu, & Chladkova,
2019). The public corporations are undertaken to prevent discrimination and exploit citizens
in the provisions of needs. These companies are financed by the revenue as being generated
from services to people and loans for the economic organisations (Sovereign HONG KONG,
2019). Public companies are not featured through red tapes as their civil services. They note
for flexible policymaking, decision making, and further there is an implementation of policies
while enabling to attain the objectives (Berkery, 2019). A public company consists of huge
organisation structure because it has several members with directors, audit committee,
strategic committee, nominating, management development, president, internal audit
department, and corporate governance committee, compensation committee executive office,
and company secretary. Each department has a manager and president such as corporate
strategy innovation, hotel investment, office building, financial accounting, human resource,
and information technology (Sovereign HONG KONG, 2019).

(Source: Erawan, 2019)
Organisation functions defines the appropriate activities, which has to be undertaken by each
department to achieve the organisational objectives of producing maximum and generating
maximum profits. Organisation structure positions each person at a place where He/She is
responsible to accomplish the appropriate activities defined by positions (Esteva, & Zheng,
2017). Matrix often avails flexibility where business functions can be operated with absolute
centralised form so that maximum profit can be achieved. Divisional structure extends its
functions across branches with different product lines, each product has its own functional
groups that includes sales, accounting, sales, and R. &D. Advantage of approach is each
division performing for the company having personnel to carry out all the essential functions
(Ramanadham, 2019).
Advantages of interrelationship between organisational functions and organisational
structure

The advantage of divisional organisational organization with the organisational functions
give large business an ability to classify greater section of organisation`s business. Public
companies consists of parallel team focusing on service. For example- Microsoft software,
general motors and the commerce and retail team of bank of America. Divisions work sound
as they permit teams to emphasis on single product with a particular guidance structure
supporting strategic objectives. This allows them to create a common culture and paying to
highest morale with better information of portfolio.
Disadvantage of interrelationship between organisational functions and organisational
structure
Divisional structures can also have some weaknesses as it competes divisions and allow
office policies to pollute the organisational environment and culture. Rather than bringing
value to the organisation, sound strategic thinking can affect allocation of organisational
resources. For example- Microsoft, which is a public company and it, is unable to integrate its
Microsoft software divisions as developed through the social connector in the Microsoft
office outlook. Moreover, it is seen that some of the experts suggest that Microsoft central
structure contribute to a condition, as the products are inharmonious in internal business units
(Ramanadham, 2019). This divisional structure creates lot of terminated efforts and the
competition between divisions. Sometimes, it is quite difficult to achieve the priorities
especially when employees are competing between the projects (Berkery, 2019).
Conclusion
From the above discussion, it is seen that public companies need more money to establish,
expand its business, and maintain because everything needs reporting requirements. If the
director fails to meet the legal needs, then they are personally responsible for company`s
failure. Whereas, private companies can start their business and expands it just after

director`s and board meetings. For analysing each of the structure f business, the report has
selected a public company, a private company and a NGO of Hong Kong, which have
different purpose of their existence. For example- public and private companies often seeks to
create maximum profits but NGO works to avail services to services to human. The level of
operations depend on their legal structure, their needs, scope, size, and objectives of the
organisation.

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