This unit states that majorly all UK supermarket chain has thought of restructuring in their business plan to achieve competitive gain and respond to all changes of the business environment.
- Evaluate various size and scope of business organization.
- Critical evaluation of interrelationship of Sainsbury and their link with business structure
- Reflect on the positive and negative impact of the macro-environment on business activities of Sainsbury including examples.
- Develop strong and weak factors of Sainsbury and their interrelations with external macro factors.
INTRODUCTION
There are different kinds of organisation like profit organisation which aims to earn profit, other can be non profit organisation where company earns profit to invest in works related to the welfare of the society and one is non governmental organisation which only seeks for performing activities which provides benefit to the society. They work with the help of funds which are raised through charity and donation. This report depicts the differences between various type of organisation on the basis of their goals and size. It also includes factors such as market share profit share and growth associated with it (Hillary, 2017).
TASK 1
P1. Different types of organisations
a. Differences between profit, not for profit and non-governmental organisations
Purpose
Every organisation has different purpose. For the profit seeking company, there would be various goals such as mission to generate a good amount of profit and to produce an effective product and services to satisfy the needs and requirements of a customer. They introduce their offering in the market for solving particular problem or increasing the efficiency of certain products such as various electronic items. Whereas a non -profit or a nongovernmental organisation does not aim for earning lot of profit, instead they work for social cause and activities which are related to the welfare of the society (Crane and Matten, 2016).
Funding
For these profit-seeking companies, they have various sources for funding such as taking loan from banks, local investors and revenue generation through sales. If their product generates a high value, then there are chances that many global investors become interested to provide funds for them, whereas the non-profit organisation and NGOs tends to get fund through private donations, sponsorship through various corporate and grants from the government.
Leadership
Large corporate are lead by the team of individuals which can be board of directors, stakeholders or investors. They are not only considered as leaders but also have a huge share of the company for the financial success whereas the NPOs and NGOs get direction from the board of directors who takes the responsibility of the whole organisation. They have to balance their financial concern as well as the social activities for which funds are being raised.
Staff
Staff or the employees for the profit earning company are employed against salaries; they require some monetary as well as no monetary benefits for their contribution in the organisation. Nevertheless, those who work for non-profit and no governmental organisation are considered as volunteers and donors who want to contribute for a noble cause (Key differences between Non-Government Organizations (NGO) and Non-Profit Organizations (NPO), 2018).
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b. Business purpose and supply of goods and services
Purpose of Business
The business purpose for various organisations can be very different. For some organisation, profit earning can be the goal which includes financial gain, focusing on the metrics of finances and businesses and also certain key performance indicators of the company. While some companies focus on providing value products and services to satisfy needs and wants of the customer and also to give a tough competition in the market and establish themselves leading producers for the particular segment of a market. Whereas some organisation like non profit earning also aims to earn profit but to invest in some social work or for the betterment of the society, they produce products and along with that collaborate themselves with this association that works for noble cause. In addition, there are some Non- governmental organisation that works just to provide benefit to the society by raising funds through charity and donation.
Supply of product and services
Profit earning corporate always think for providing innovative ideas to the market which can benefit various customers in many ways. They always conduct various researches on the existing product to make it better. Also, focusing on the fact that the product should reach every corner of the area. Whereas NPOs majorly promotes arts, researches, sciences and commerce and tries to make certain policies to give them recognition. Whereas the scope of NGOs is generally very limited as they work in confined areas and on the basis of amount of fund they are raising for their work (Deasy and et. al., 2017).
Suggested: Business Environment of Different types of Organization - Nestle
P2. Size and scope of the organisations
a. Difference between micro, small, medium-size and large enterprises
|
Micro/Small Enterprises |
Small Enterprises |
Large Enterprises |
|
Equity is held by either founder or the member of the family |
Mostly held by private individuals who can be family or few shares can be publicly held |
They have mostly public investors such as government who also have the rights for equity. |
|
Decision is made by the owner of the firm |
Decision is made by the individual who has the highest authority such as CEO |
Decision making power can be distributed among different members. |
|
Works on short term plan |
Can work on short as well as long term plans |
Only works on extensive long term plans. |
|
Processes are mostly informal |
Formal approach is used for the process |
Have Formal structures and processes for every task |
|
Small customer base |
Limited Customer base |
Having diverse market and customers. |
|
Funds raised by leveraging personal net worth |
Sources of capital are limited, even some are hard to access |
Funding sources has a wide range, availability of investors are more as compared to other enterprises. |
|
Personnel development opportunities are limited |
Development of personnel is limited to key employees |
Multiple career development programs are offered to workers. |
|
Requirement of extra input is less which can be taken from friends and other networks |
Also, requires less input which is mainly taken from trusted professionals, friends and networks |
Requires significant external inputs which is assisted from consultants and also have separate governance structure |
|
Mostly managed by the owner |
It can be owned by owner as well as various professionals of particular areas |
They have complete professional management for effective working |
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