Understand organisational structures Essay
Understand organisational structures
1.1 Explain the differences between the private sector, public sector and voluntary sector A private sector is usually composed of organisations which are privately owned and not part of a government; whereas a public sector is composed of organisations that are owned by the government and voluntary sectors are composed of individuals of who seek help in charitable activities. Private sectors include corporations such as partnerships and charities, like the voluntary sectors, and the public sectors include corporations such as federal, provincial, state or municipal governments. An example of a private sector is a retail store or credit unions, and example of a public sector is an educational or health care body and an example of a voluntary sector is anything where hands on help is needed for charitable causes. When considering a public sector and voluntary sector, money is not the goal and they often offer things to individual that will be preventative or supportive, like doctors surgeries offering out flu-shot at home, NHS with the aftercare for ex patients, rehabilitation centres and offering work for unemployed to do to get more experience such as local community work, like clearing the local pond or helping with community groups to appeal to individuals consciences.
1.2 Explain the functions of different organisational structures Bureaucratic structures stick to a strict hierarchy system when it comes to their management. Pre-bureaucratic structures lack in standards and are found more within small scale, start p companies. This structure is usually centralised and there is only one key decision maker. The communication within this structure is all done in one-to-one conversations; this type of structure can be really helpful for small scale organisations as the founder has full control over all the decisions and operation’s. Bureaucratic structures have a certain degree of standards and are found within organisations that grow complex and large. These structures require management and are suitable for tall organisations. Post-bureaucratic structures are found within organisations that follow the strict hierarchies, but are open to modern ideas and methodologies. This structure follows techniques such as total quality management. Functional structures are divided into segments which are based on the functions of managing.
This structure allows the organisation to enhance the efficiencies of the functional groups. Functional structures appear to be successful within large organisation of who produce high volumes of products at a low costs. The low costs which can be achieved within these structures are able to be achieved by such companies due to their efficiencies with a functional group. Divisional structures are divided into the functional areas of the organisation to divisions. Each division within this style of structure is equipped with its own resources in order for them to be able to function independently. The divisions within the organisation are all defined based on the geographical basis, products/services basis or any other measurement within the organisation. Matrix structures organisation place their employees based on the function and the product. The matrix structure gives organisations the best of both worlds of functional and divisional structures. Within a matrix structure the organisation uses teams in order to complete tasks, and the teams are based on the functions in which they belong to within the organisation. Also with the matrix structure although the functional hierarchy is still in place the project manager of the organisation is recognised as a valuable person and is therefore given more authority to manage projects within the organisation.
1.3 Describe the features of different types of legal structures for organisations An unincorporated association is an association which follows a simple membership structure and is often found within smaller organisations which have a low risk activity and membership. These associations are easy to set up and administrate but they have no legal identity; agreements or contracts and their leases are held within the names of the board or the management committee member personally. A trust is often used by trusts that make grants or smaller service providing organisation of whom do not have a membership. Company limited by guarantee are organisations which are registered with a company house and are found more within organisations that are of a larger size and have their own buildings, employ their own staff and have significant contracts or other responsibilities.
These companies have a legal right of their own, which means that any agreements or contracts made with that certain company are held within the name of the company, however this limits financial liability. Sole trader is where a business is run as an individual; so that all profits are their own after tax has been paid on them. Within a sole trader organisation it is possible to employ staff, as the sole trader only means that you own the business personally and do not actually have to work by yourself. Limited company is an organisation in which allow you set up and run your business. Any profits which are made within a limited company stays within the company after it has paid corporation tax, which then allows the company to share its profits. 2 Understand the organisational environment
2.1 Describe the internal and external influences on organisations There are many internal and external factors which can have an influence on an organisation. An internal factor that can influence an organisation is corporate objectives as these can be a cost of reduction leading to the HR needing to implement redundancies or new job allocations. Operational strategies is another factor which can influence a business because if there was a new member of staff within a department which requires quite a lot of training it can cause disruption in the business as training may take over the daily tasks which have to be completed. Marketing strategies can also influence a business as they may have to develop new products to enter to the new market which then may require them to make changes in their organisational structure and they also may have recruit new sales team if they are decreasing in sales of a new product.
Financial strategies is an internal factor which can influence a business as they may have to make a decision on whether to reduce their costs by outsourcing training which would then result in them having to change their training programmes. An external factor which can influence an organisation is the market changes; this can influence an organisation as they may lose market share due to a new competitor in the market which therefore may require a change within the divisional management or job losses to improve the competitiveness. Economic changes can also influence an organisation as it can place more pressure on to the HR departments of an organisation which may lead them to have to reduce staff costs to be able to improve productivity. Technology changes can also influence an organisation as companies will be able to communicate with all employees and customers more easily due to the expansion of the internet. But it could influence an organisation in a negative way as some customers or employees may not be computer literate meaning that technology changes can decrease some sales or training opportunities for employees.
2.2 Explain the use of different models of analysis in understanding the organisational environment A SWOT analysis is a very useful way of helping to understand and help with decision making for all different types of situations that can happen within a business and organisation. SWOT stands for Strengths, Weaknesses, Opportunities and Threats; these headings provide an excellent form of reviewing a business when considering their strategies, position, direct of the company and the companies position. A SWOT analysis is a simple method which works well in brainstorming meetings, business planning and strategic planning, competitor evaluation, marketing, business and product development, it is also good in using for research reports. A SWOT analysis can also be a beneficial method when used within team building games. A SWOT analysis measures a business unit, a proposition or an idea; whereas a PEST analysis measures a market. PESTLE analysis is an audit of organisations environmental influences which is there for the purpose of being able to later use this information to guide strategic decision making.
When an organisation has this audit it allows them to assess potential changes that may come into effect that can make them better than its competitors. Being able to make decisions can help organisations to plan for future events which help organisation get a better understanding of the wider ‘meso-economic’ and ‘macro-economic’ environments that they may later work within. A PESTLE analysis therefore allows an organisation to understand the bigger picture of the environment in which their organisation is in, letting them to identity the risks associated with that market and growth or decline in their business they encounter. 2.3 Explain why change in the business environment is important Change is an important part in the business environment as it can help companies and organisations to grow and to become a more successful organisation.
Technology is key in business change; this is because if technology hadn’t come around into today’s society business leaders would still have to be dictating correspondence with secretaries, editing there words and constantly going back to the drawing board which can waste a lot of valuable time, but with technology organisations are able to communicate more effectively with individuals outside of the organisation, develop new skills for their company which altogether helps organisations to learn more quickly on all the positive things in which they can do for their business. Change in customer needs is also essential in business change as this allows organisations to develop and evolve their company so that they are able to reach out to a wider range of individuals, making their profits and business go up in the league. Also customer needs allow companies to create more products which are on a high demand which can lead to more opportunities within the business environment. The economy can also change the business environment, in a positive, but also negative way. If an organisation is within a strong economy then that company may need to expand their organisation in order to meet the needs of customers, new staff and facilities.
However a weak economy can create more problems due to companies coming across difficult decisions that they may not know how to respond to; this can also impact on employees’ salaries and benefits and in some cases threaten their jobs. However, when an organisation is able to manage both ends of the spectrum then that organisation will be able to create strong brands and relationships with customers and employees in which can mean that a change in the economy may in actual fact be beneficial for an organisation. Growth opportunities can also be important as this allows employees to be able to learn new skills, explore new opportunities which can ultimately benefit the organisation in which they work in.
Growth opportunities can also be beneficial to training within an organisation as more training courses are online creating more scope for training to happen which can increase an employee’s capability by filling in gaps between their current skills and also developing new skills to help with the organisation. “Why?”… asking the question why can be important in a business environment as it allows for positive change; this is because organisations will be able to learn more about the customer’s needs, ways in which customer service can be delivered, how to strengthen customer interactions which they already have in place and being able to develop new products which can attract more new markets.