In the learning outcome 1 and 2 of this assignment I will explain the different types and purposes of organisations and give examples of different sectors and legal structures, as well as exploring the size and scope of a range of different organisations. In the last part of the learning outcomes I will look into the relationships between different organisational functions and I will explain the connection between organisational objective’s and structure.
In the learning outcome 3 and 4 I will talk about different business operations and identify the macro environment’s positive and negative impact on them.
I will also identify organisational strengths and weakness by conducting an internal and external analysis of a company’s business operations.
Learning Outcome 1 – Different types and purpose of organisations.
I will start by giving a definition of what an organisation is: “An organisation is a group of people who work together in an organized way for a shared purpose.”
My understanding of an organisation is a group of people that are trying to achieve the same goal by working in cooperation together.
The three types of organisations are:
Firstly, the Voluntary sector is mainly defined by businesses not necessarily focusing on maximising their profits, it could be described as the caring and compassionate sector.
The purpose of the Voluntary sector is to help and support all different walks of life. Examples here would include the Red Cross, Medicines sans frontiers or other organisations providing care and help to the general public or specific groups of the public.
The Private sector is for profit-making and the organisations in the Private sector are normally controlled and run by individuals, groups of people and are either privately held or publicly quoted on the stock exchange. Examples within the private sector are retail stores (either ‘bricks and mortar’ stores or online), supermarkets, airlines and automobile companies.
The Public sector is the sector which is owned and run by the government and is usually financed by tax payer’s money or government funds, essentially national debt. The many purposes of the public sector include; support to the local community, take caring of and protecting citizens, healthcare and education. Organisations within the public sector include; schools, the police, the Armed Forces, the NHS and local government departments. Public sector organisations provide vital services that enable the country to run efficiently and effectively on a daily basis.
Deciding on the legal structure is one of the first decisions when setting up a business. Within the private sector the main distinction is between private and public companies. Examples of these are sole- traders, limited liability partnerships, and publicly quoted companies (PLCs).
Sole Traders are likely to be limited in size and scope, they might only cover a certain area and only provided a limited number of services. A corner- shop or an office licence would be examples. They responsible for the day to day running and decisions for their business. They have full responsibility and full control. Any profits generated will be entirely available for the sole trader. A disadvantage of this legal form is that the sole trader is fully responsible for all losses.
A partnership is likely bigger in scope and size then a sole trader. For example, partnership of local doctors will have a bigger scope as it can offer different medical services. A partnership consists of two or more owners. There are pros and cons of this legal structure. Any losses are divided by the partners, but also any profits are shared. As there is more than one person responsible for the business, all partners need to share and agree the strategy of the business and at times make compromises when opinions differ. A contract between the partners in a partnership is not necessarily required by law, however, it is advisable that the partnership is captured in a contract that all partners sign up to.
A corporation or company, is a legal construct that is normally owned by shareholders. Unlike partnerships, the liability of the shareholders is limited and not personal. Corporations are usually public, and quoted on the stock exchange, or privately held. An example of a public corporation is Apple. Unlike in a partnership or a sole trading business, shareholders in a corporation are usually not involved in the day to day operations of the company. However, this is not the case if the employees of a company are also shareholders of that company. I usually think of a corporation of both large in size and scale, some corporations are active around the world and produce many different products others might be limited in the counties they operate or products they offer, but in general they are bigger than a sole- trader and a partnership.
Learning Outcome 2
Every organisation has different departments with different functions for the organisation to run effectively and efficiently e.g., marketing, IT, sales, human resources just to name a few. For an organisation to work and be successful all departments have to support each other in order for the organisation to reach its objectives and goals.
As an example, I look at Emirates Airline and its organisational functions.
Within the Emirates Airline the main functions are
Executive management – this team of senior managers sets the overall vision and strategy of the company. They deal with aircraft orders, new routes and the overall direction of Emirates.
Sales and Marketing - Responsible for promoting the Emirates brand, and also the destination and city of Dubai, advertising destinations and routes, pricing seats and setting fares, think of new ideas and setting targets. Marketing also runs the sponsorships and business promotions of Emirates Airline. Examples are sponsorships in football, tennis and other sports.
Human Resources – Responsible for recruitment, training, payroll, employee benefits and remuneration, hiring, termination and any employee disciplinary or grievances.
Engineering – Responsible for inside and outside maintenance of aircrafts.
Flight Operations – Responsible for flight and cabin crew scheduling and safe and effective daily operations of the airline. They also ensure on-time departures of planes as well as training the flight and cabin crews.
IT Department - Responsible for making sure all systems used by the airline are in good working order and offer support for any IT issues. If there is a problem with the IT systems it could affect the operation of aircrafts. This could result in delays and cancellations and that would have a negative impact on business as passengers would lose faith in Emirates.
Emirates Airline’s objective is to fill each and every one of its 238 aircrafts to maximum capacity every day. This is also called by insiders ‘getting bums on seats’. All departments have to link together to complete a strong and solid chain that forms the Emirates Airline’s organisation.
Learning Outcome 3 – Identification of Macros and its impact (Positive and Negative) on Business operations.
Any organisation must take into consideration any external factors that could have a
positive or negative affect on the business. They include political, economic, social, technological, environmental and legal. The term for this is ‘macro environment’. PESTEL is a model that can be used to analysis the macro environment.
I would like to highlights 3 examples of how the macro environment has had a positive and negative impact on Emirates airlines.
Political and security.
Emirates airline is located in Dubai in the United Arab Emirates. At the moment, the political situation within the middle east is unstable making it a negative factor. In June of this year, 5 Arab states including UAE, Bahrain, Saudi Arabia and Egypt suspended all flight to Qatar because of Qatar’s close links with terrorisms. This most certainly is a negative factor because of Emirates location this could deter people from wanting to fly through the gulf and they may choose to fly with another airline affecting sales.
From October through to May, Dubai has the perfect winter climate making it a great escape for tourists to visit with its high standard of hotels and customer service. Dubai’s tourism is booming adding to the economy of the country. For example, when I started with Emirates 9 years ago, they operated 7 daily Boeing 777, 380 capacity flights to London. Now they operate 9 daily Airbus 380, 481 capacity flights to London. That’s an increase of 1,809 (71%) daily passengers, making tourism a positive economic factor.
Learning Outcome 4 – Analysis internal strengths and weaknesses of an organisation and how the macro environment can ….
It is advisable for an organisation to conduct an analysis of internal and external strengths and weaknesses to establish where the company it at and to see if changes need to be implemented. For this purpose, I will analyse Emirates Airlines (“EK”) using the SWOT model.
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