Types, Functions, and Interrelationships in Business Organizations

This report provides a detailed analysis of different types of organizations, including profit, non-profit, and non-governmental organizations, as well as small and medium enterprises. It explores the scope and size of these organizations, using examples like Claridge's Hotel and the BBC. The report also examines the interrelationships of various functions within an organization, such as marketing, human resources, finance, and sales, and demonstrates how these functions contribute to organizational success. Furthermore, it discusses the impact of the macro-environment, including political and economic factors, on business operations, and provides a PESTLE analysis to assess environmental variables. The report concludes by highlighting how these elements influence the organization's performance and reputation, offering insights into how organizations can navigate challenges and capitalize on opportunities.

Introduction
The study has a piece of detailed information on how the corporate firms are different from one
another in various terms such as scope, practices, and size. A business's operations are influenced
by a variety of variables. Each of the organizations in bids its own form of structure and working
pattern which makes it more unique from others. Organizations must engage in a variety of
activities in order to attain their aim. An organization is only successful when it uses the
resources according to its objectives and size. Every firm faces many types of good and bad
effects depending on their functions and the new opportunities and challenges. The financial
requirements of each sort of organization vary significantly. In comparison to private
organizations, public organizations require a lot more money. Most of the firms work on their
own and the rest give that to others so that they can do business under their name.
Claridge's is a 5-star hotel in Mayfair, London, UK. It is located at the intersection of Brook
Street and Davies Street. Because of its long-standing ties, the hotel has a regal structure. It is
maintained by the Maybourne Hotel Group, and it is frequently referred to as a Buckingham
Palace annex. Mivart's Hotel was established in 1812. The hotel employs around 400 people and
includes 203 rooms and suites, as well as two restaurants, two bars, and a fitness club and spa.
Because of its popularity in the United Kingdom, it has earned $73.15 million in sales, and it is a
limited-edition private hotel.
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LO1 Explain the different types, size and scope of organisations
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The types of organization are divided on the basis of their objectives:
Profit organization
The primary goal of this form of organization is profit; they conduct commercial activities in
order to make profits by meeting the demands of the customers. These organizations are
typically held for private purposes and are run by one individual or a group of individuals. The
state governs their operations and functions carried out by them.
They are bound by the rules and regulations established by the governmental authorities. The
income generated by these enterprises is reinvested in the company for future operations, and the
leftover profit is distributed among the organization's shareholders. There are several sectors that
can serve as the greatest examples of profit organizations, such as the food industry, clothing,
and fashion and retail industry.
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Non profit organisation
These organizations are dedicated in order to assist the public and therefore have no aim to make
profits out of it. These organizations might be charitable organizations or social ventures. In this
type of organization, they manage their business activities, and the money produced is utilized
for various purposes, with the remainder divided among the members.
These organizations need not pay the taxes as they are exempt from taxation under the law. This
is because they get their money through contributions and donations. Non-profit organizations
are often associated with the educational, religious, and health sectors.
Non-government organization
This category includes non-profit organizations that are not run by the government. They are
generally referred to as non-governmental organizations (NGOs), yet they may accept
government funding. NGO's are also reliant on funding produced through contributions or
donations.
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Small and medium enterprises
Many organizations are classified as small and medium companies based on their business scale,
which is determined by the number of workers, market share, and number of stakeholders, as
well as their authorized position (Macchi et al., 2020). Micro-enterprises have 10 to 20 workers
and a two-million-euro annual turnover, whereas small and medium-sized businesses have 250
employees and 50 million euro annually. These enterprises must know about their legal structure
in order to manage their future activities.
Sole proprietorship
These are enterprises that are operated by a single or more than one person who is the owner.
They are often small size firms with a low work load and turnover. In this the sole proprietor is
accountable for all the firm's losses and earnings. Hence the amount invested in less as compare
to partnership.
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Partnership
Partnership firms are enterprises that are owned by two or more people. Profits and losses are
distributed equally in accordance with the provisions of the partnership agreement. The
partnership act describes the laws and regulations that govern partnership firms. There are many
benefits of being in a partnership such as it is easy to form, huge creditworthiness, greater
managerial and financial resources, the decisions are taken are balanced, and maintain the
secrecy is also easy in a partnership firm.
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Three kinds of organisations such as public, private and voluntary:
Types Public company (BBC) Private company
(Claridge’s hotel)
Voluntary organisation
(National Trust)
Meaning They work for the public in
order to help them and are
owned by the government.
They are the ones who do not
aim at earning profits. The
BBC is the largest NPO in the
United Kingdom.
The Claridge's hotel is a
personal company that
exists to make money. They
are run by persons who are
only concerned with making
money.
The National Trust is a sort
of non-profit organization
that works to preserve the
environment and heritage.
They are a non-profit
organization that operates
solely on philanthropic
donations.
Size The BBC employs 22000
people and has a total yearly
income of £4.943 billion.
The hotel employs around
400 people. The hotel's
average revenue is $73.13
million.
The organization employs
around 14000 people. The
organization's yearly
income is £681 million on
average.
Scope The corporation gives the
public access to mass media
and generates income by
working with numerous
private businesses.
The Claridge Hotel offers
premium amenities to its
guests, including 200
rooms, a restaurant, pubs,
and a fitness club. This
organization thinks that
revenue should be
reinvested back into the
business.
They work for the well-
being of nature as well as
the preservation of the
environment and nature.
People who want to
volunteer for a good cause
can join the organization.
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LO2 Demonstrate the interrelationship of the various functions within an organisation and
how they link to organisational structure
List of few functions which are used to make the organization performance successful. Marketing department
The marketing department is in charge of marketing various services and products. As well it
also assists in the sale of the product through different ads and promotional methods that help the
firm improve its sales. This department also takes into consideration the current demand in the
market so that the product or services can be customized accordingly. There are numerous
marketing tactics that may assist an organization gain clients and build product demand.
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 Human resource department
The Hr department assists the firm to manage and control the work and performance of
employees and also to look that they are well trained and expert in their work field. They also
look over the employees' salaries and deal with any issues that arise with other employees.
 Finance department
They are in charge of resolving all of the organization's financial issues. The finance department
gathers funds for the production and other operations. They assist the organization in times of
financial loss due to imbalance. Sales and production department
They are in charge of producing the items and then selling them through the appropriate channel
of distribution. The sales department maintains the stock of the product and monitors quality
standards while the manufacturing department ensures that the product is steady and correct in
terms of quality.
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Interdependence of each departmental function to enhance the efficiency of organisations.
Each department must rely on the assistance of the others in order to meet all desires and
accomplish organizational goals. Claridge's hotel's finance department assists the other
departments in supplying cash for their daily operations. The finance department assists the other
departments so that the organization's operations do not come to a halt owing to a lack of cash.
The hotel's marketing department assists other departments by selling their services through ads.
The human resource department is critical since hotel employees have a significant influence in
determining the hotel's service quality. As a result, HRM should cope up with all the other
departments in order to increase and improve the performance of the organization. The
requirements and desires of the consumers are met by the hotel employees in order to satisfy
them and for that, they must be perfect in their work. The service quality provided by the hotel
might help to improve its reputation in the market.
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