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Organization

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Unit:1 Business
Environment

Class Room Rules





Take responsibility for your education
Attend every class
Come to class on time
Mobile phone-Silent mode

• Do not dominate other students’ opportunities to learn by asking too many questions.
• Your classmates deserve your respect and support - Others may have different ideas and opinions from yours, they may ask questions you perceive to be “stupid,” but they deserve the same level of respect from you as you wish from them.

• Do not, under any circumstances, indulge in clownish or disrespectful behavior whose primary purpose is to draw attention to you.

LO1 Understand Organisation Purposes in Business
P1.1 Identify the purposes of different types of organisations. P1.2 Describe the extent to which an organisation meets the objectives of different stakeholders.
P1.3 Explain the responsibilities of an organisation and strategies employed to meet them.

CATEGORIES OF BUSINESS
Think about who these businesses might be owned by and how they raised the finance and run the business.

Cactus

Symphony Restaurant

Gadir Salon

Amana Takaful-Maldives

Maps College

Burger King-Maldives

Flyme

Mazlan and Murad Law Associates

Public and Private Sector
Private Sector: Organisations set up for personal gain and are funded by share issued, loans, from banks etc.

Public Sector: Organisations set up in the interest of the community and are funded wholly or partly by the government

Types of Organization
Sole Traders
• Sole traders are single individuals carrying on a business on their own.
• Usually small

Advantages

Disadvantages

No formal procedures

Unlimited liability

Independence and self reliance

Financial problems

Close to their customers

One skill

Partnership
• A partnership is two or more persons joined together for the purpose of a business or profession. • The limited Liability Partnership Act 2000.
Unlike normal partnerships the liability of members of LLP on winding up is limited to the amount of capital they contributed to the
LLP

Companies
Private limited companies: Whose shares are only transferable by direct contact and purchase from the shareholders (eg: members of family, friends)

Public limited companies: That are traded on an official stock market (such companies may include plc in their names)

Co-operatives: Linking together of consumers, producers or retailers into trading organisation, which is then used to represent its constituent members in the marketplace.
Voluntary Organisations: non profit driven run by individuals who do not get paid for running the organisation. THE PRIMARY, SECONDARY
AND TERTIARY SECTORS
Primary Sector: The sector of industry consists of industries that produce raw materials.
Example: extracting minerals

Secondary Sector: The sector of industry that produces goods by using the raw materials produced by the primary sector. Example: Fish canning VISION, MISSION, OBJECTIVES AND
VALUES
Vision:Strategic intentions of an organisation.For eg: Virgin Group had the vision to be the number 1 entertainment and service provider.
Mission: Specific role that the organisation plans to fulfill.
Actions for the present and immediate future.

Values: Shared beliefs and determines the culture of the organisation, providing a set of principles that govern overall conduct of the organisation performance.
Example: Body Shop Support Community Fair Trade,
Defend Human Rights, Against Animal Testing, Activate
Self-Esteem, and Protect Our Planet.

Goals: shorter time frames than the more general mission statement. For eg separate goals may be developed for customers, suppliers, employees and shareholders
Objectives: set out more specifically the goals of the organisation.

STAKEHOLDERS
★Internal Stakeholders: Employees,
Management
★Connected Stakeholders: (Shareholders,
Customers, Suppliers, Financiers)
★External Stakeholders: (Community,
Government, Pressure Groups)

Example: Shiseido

Conflict of Interest

Stakeholder Mapping
★ Who they are?
★ What they want and what will they accept?
★ How satisfied are they?
★ How much power do they posses?
★ What sort of power do they posses?
★ How compatible are their interests?
★ What conflicts exist?

Power Influence Matrix

★Key players: strategy must be acceptable to them. Eg: major customer
★Keep satisfied: treated with care , they are capable of being key players. For eg: shareholders ★Keep informed: do not have great ability to influence strategy, but their influence can be important to influencing more powerful stakeholders. ★Minimal effort is expended on this segment.

Measuring Performance
★Can only be determined once a business has identified its stakeholders
★The requirements of each stakeholders group are.
★Strategic planning.

RESPONSIBILITIES OF ORGANISATION
Social Responsibilities
★Obligations that the organizations has towards the people and the environment in which the company operates.
★Social responsibility is expected from all types of organization

Activity
What actions might businesses take to show responsibility and sustainable development ?

Ethics and Business: What precisely are ethics? A sociologist posted the question to businesspeople and got these answers:
★‘Ethics has to do with what my feelings tell me is right or wrong’.
★ ‘Ethics has to do with my religious beliefs’.
★ ‘Being ethical is doing what the law requires’.
★ ‘Ethics consists of behavior our society accepts’.
★ ‘I don’t know that word means’.

Ethics is about the codes of moral principles that people follow with respect to what is right or wrong.

★ Enron being charged with massive accounting fraud , in
2001
★ Business ethics is also relevant to competitive behavior.
For example: The dispute between British Airways and Virgin centered around issues of business ethics:
• The theft of information.
• The planting of inaccurate and offensive stories in the press.
• An unfair price war.

RESPONSIBILITIES OF
ORGANISATION
★Employees: Good Recruitment, training and development, Redundancy and retirement policy. ★Customers: Quality products, dealing honestly fairly with customers.

★Suppliers: Should not use power unscrupulously (force the supplier to lower the price); should not delay payment, should maintain confidentiality, maintaining long stand relationship.

★Competitors: Fair trading

★Community: Contributing to the well being of the community, responding constructively to complaints from local residents.

Thank You
Source: Business Essentials (2013), ‘Business Environment’,BPP learning media. www.Tutor2u.com www.Investopedia.com www.thbusinesscasestudies.co.uk

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