Hnc Business Studies Unit 1 Business Environment

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1 Understanding the organisational purposes of business 1.1 Identify the purposes of different types of organisations An Organisation is defined as a social unit of people that is structured and managed to meet a need or to pursue collective goals. All organisations have a management structure that determines relationships between the different activities and the members, and subdivides and assigns roles, responsibilities, and authority to carry out different tasks. Organisations are open systems--they affect and are affected by their environment. ( (accessed 8.2.2015) There are many types of organisations in the UK, which include many different purposes. Organisations are set up in specific ways to accomplish different goals. The two main classifications are defined as profit making and not for profit making. Private companies have a main purpose, which is to make profit. These organisations focus on generating large quantities of capital, assets and investment. Private companies have a relatively small number of shareholders and do not offer or trade shares to the general public. The Purpose of a Limited partnership organisation is to make profit, Limited partnerships are usually owned by two or more people, which they finance and run join tly for personal gain, in this type of organisation. Profits are shared equally. A Public Limited company (PLC) this organisation is similar to a structure of a private company, however their purpose involves a more long-term strategy for profit making. Shareholders own PLC’s, and unlike private limited companies these are advertised to the public. 1.2 Describe the extent to which an organisation meets the objectives of different stake holders 'People or small groups with the power to respond to, negotiate with, and change the strategic future of the organization' (Eden and Ackermann 1998:

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