The objectives and culture of organisations have evolved over the years and in order to understand the purposes of businesses it is necessary to examine several components. This section will firstly, identify different types of organisations and the varying purposes they hold. It will then progress to explain the extent to which an organisation meets the objectives of various stakeholders, an example will also be included here to help illustrate this. Consequent to this, this section will also explain the responsibilities of an organisation and strategies adopted by the firm to ensure it meets them.
• Identify the purpose of different types of organisation
There are numerous types of organisations and every organisation will vary to suit the needs of the individual and the business type. A sole trader is an individual who sets up, controls and provides for their own business. They may throughout time look into employing other people however the individual will be the sole owner. The sole trader will have unlimited liability and they will be the exclusive decision maker and fully reliable for any debt that may occur throughout the full business lifespan. A sole trader organisation will have strong relationships with their clients as there likely to have a smaller cliental. However being a sole trader has its disadvantages and one of them is the lack of cover if the owner is off sick or wanting holidays, which means the organisation is likely to stop trading during this time resulting in no income for the duration of this.
A Partnership is an organisation which is owned by two or more individuals associated for the main purpose of the profession. The business will be running as self-employed but all partners must share the responsibility of success or failure of the business. The partners will have set up an agreement ‘Deed of Partnership – a legal document formalizing the agreement and financial arrangements between the parties that make up a partnership’ (qfinance.com). The Deed of Partnership generally contains all information relevant between the relationship of the individuals, i.e. amount of capital each partner will provide and how profits are split. The main reason for setting up a Partnership will allow there to be more capital available to start up and also a more varied combination of skills. Being a partnership will also spread the risk across the partners so if the business does fail there are more people to share the debt with.
Another type of an organisation is a charity; these will have different aims and objectives. The charities aims and objectives usually sum up the issue that they are attempting to tackle or provide for. Many charities will have a key mission statement that describes their aim. Using their mission statement will allow them to produce specific objectives that lay out how they will achieve their aim. The main objective of a charity organisation is supporting there group that they are trying to raise funds for. A charity is different from most other organisations as they are non profit and all funds raised will go towards their cause. A charity relies hugely on volunteers and also the community to let their fundraising become successful.
• Describe to the extent to which an organisation meets the objectives of different stakeholders
‘A stakeholder is any individual or organisation that is affected by the activities of a business. They may have a direct or indirect interest in the business, and may be in contact with the business on a daily basis, or may just occasionally.’ (tutor2u.net)
To help illustrate this, the below information is regarding Tesco and how they go about meeting the objectives of their Stakeholders.
Customers are a major stakeholder for Tesco. ‘Customer Question Time meetings are invaluable. Colleagues hear customers' views on everything from how we are serving them in our stores to our role in the community.’ (tesco-careers.com) To ensure that Tesco meet there objectives they hold Customer Question Time (CQT) meetings which allow store and head office staff to hear customers feedback from all their stores around the world. Tesco organising this gives all employees the opportunity to identify and respond to their customers needs as these are changing more and more every day. From a recent feedback session Tesco discovered that they need to have a better understanding of their disabled customers shopping needs, their requirements for parking spaces in their car park and also the need to train their staff on how to recognise and provide assistance on their disabilities. To help get a better understanding of this they have organised CQTs hosted by disabilities organisations each quarter.
Another huge stakeholder is their employees. These are the faces that customers are dealing with day in, day out. The employees are interested in the continuation and growth of the organisation as they need the security of income along with happy and safe working conditions. Employees have a major impact on the success of Tesco, they will need to ensure that they keep their staff highly motivated ensuring that the employees provide the best service possible at all times. Motivated employees will be far more productive, offer a better service, work as a team and also have more ideas. To ensure that employees are happy within the workplace Tesco offer Staff Question Time and Staff Forums. Annually they also get the chance to anonymously fill out a Viewpoint Survey. This allows all employees to give their opinion on Tesco as a whole and what changes they would like to see in the future. Tesco ensure they try to respond to employees as a whole with the general feedback they got from this and what changes will be made in the future.
• Explain the responsibilities of an organisation and strategies employed to meet them
Tesco will have many responsibilities varying from all different sectors in the business. Each level of management will hold different responsibilities and have multiple strategies, below is a couple examples to help illustrate this.
A main responsibility for Tesco is being able to trade responsibly, this means putting their customers first and working with their suppliers to ensure a good relationship is built to innovate and provide the high quality products they need to ensure their business is meeting their customers’ needs. Another responsibility for Tesco is to be a great employer, to create inspiring work that makes their employees happy and proud of what they do. Tesco are currently working on extending their commit to have more opportunities for disabled people. They have agreed to provide more employment opportunities for disabled people to ensure they are following equal Opportunities ‘Equal opportunity is a stipulation that all people should be treated similarly, unhampered by artificial barriers or prejudices or preferences, except when particular distinctions can be explicitly justified.’ (wikapedia.org.uk). To ensure Tesco are meeting these requirements they have set up agreements with disability employment providers, Remploy and the Shaw Trust. The agreements are the culmination of Tesco’s ongoing expanding relationship with Remploy and the Shaw trust which has led to 400 disabled people getting jobs. Doing this has allowed their customers to see they are supporting Equal opportunities and ensuring every individual is given the same opportunity. ‘Beth Carruthers, general manager at Remploy, said: "Last year Remploy saw a 55% increase in the number of candidates being recruited to Tesco. This agreement is a further demonstration of Tesco's commitment to widen employment opportunities for disabled people and we very much applaud a national retailer taking such a proactive stance.’(personneltoday.com)
Tesco are currently one of the biggest retailers in the UK but they have ambitious plans to become zero-carbon. They have a simple but ambitious formula for its plans to meet this. This initiative was launched in 2009 and if successful they will become a zero carbon business by 2050.Tesco intend to halve 2006 level emissions by 2020 and to ensure any new stores built between 2006 and 2020 has half the emissions of a store built in 2006. They also want to ensure they help their customers halve their own carbon footprint by the same deadline. They are hoping that promoting ‘green growth’, customer’s behavior and attitudes will change and they will purchase less carbon-intensive products. Tesco are on the right route for meeting these plans as they were named the top retailer in 2010 for the Carbon Disclosure project award. They have recently created an all-timber look store in Cambridge, creating a zero carbon template for any store developments in the future.
‘Ruth Girardet, Tesco’s corporate responsibility director, says: “Our targets are very clear up to 2020. Beyond that, we have a good sense of what needs to be achieved. We have made great strides on energy efficiency, but there is always scope for more as technology advances. We’ll develop renewable energy so that we are self-sufficient before 2050; over time we will eliminate the use of hydrofluorocarbon (HFC) refrigerant gas, for which the technology already exists. The more difficult areas based on current technology are around transport, particularly heavy goods vehicles. We are aiming to halve the emissions per crate by 2012, but there is not yet a clear pathway to zero-carbon in this area.’(endsresport.com)