GCE Applied ICT G041: Lesson 02 Types of Organisations Mr C Johnston

Learning Outcome Understand and explain characteristics which can be used to describe an organisation including Organisation type Type of ownership Mode of operation Customer base Structure Finance provision

What Is An Organisation? An organisation can be broadly defined as: “Any individual or more commonly, any group of individuals, working in a structured way to accomplish specified tasks or results”. “An organised group of people with a particular purpose, such as a business or government department.” “An organisation is an entity comprising multiple people, such as an institution or an association, that has a collective goal and is linked to an external environment. The word is derived from the Greek word organon, which means "organ".”

Organisation Characteristics Organisations or have several characteristics we can consider when analysing them Type of organisation Ownership What the mode of operation is Who their customers / clients are What form their organisational structure takes How they are financed

Main Types of Organisation What are the three main types of organisation? There are three main types of organisation: Commercial Organisation Public Service Organisation Charitable Organisation Create some revision notes that explains the aim of each organisation type. Give examples of each.

Ownership Sole Traders Partnerships Limited Companies One single owner who takes all the risk Partnerships Two or more people who split the risk Limited Companies Companies issue shares to shareholders Only responsible for the value of your shares LTD Private Limited Company PLC Public Limited Company Feature Sole Trader Partnership LTD PLC Create a table that compares the main features the different types of ownership so they can be easily compared.

Mode of Operation The sector(s) which organisations are said to trade in is known as the mode of operation Primary Sector Acquiring Natural Resources Secondary Sector Add value to natural resources or to products which have been derived from natural resources Tertiary Sector Provide a service Quaternary Sector Research, technology and information based services

Customers / Clients Customers / clients are the people who consume the organisations activities The population of customers built up by an organisation is called its customer base or clientele Size and suitability of an organisations customer base can determine the health of an organisation Different terms for customers / clients include patients, patron, consumer, benefactor, student Customers could consist of individuals and other companies How to size and suitability of a customer base determine the health of an organisation?

Organisational Structure Every organisation needs a structure else there would be chaos A diagram of an organisation’s structure is important as it illustrates the chain of command Structure diagrams also indicate who is responsible for what within the organisation Companies with lots of levels are known to have hierarchical structure Those with few levels are known to have a flat structure

Sources of Finance The main two sources of finance for a company are Investment (e.g. shareholder funds) Loans Mature companies find raising capital easier as they have a trading record There are “venture capital companies” and grants that can assist young companies What is the difference between investment and a loan?

Examples of UK Organisations Activity Create the following table Examples of UK Organisations Include as many companies as you can think of in you table – the mission statement will help you understand their aim Try and include a good variety of ownership and operation types You will have to use the internet to find out the ownership of each company, perhaps the companies website will tell you this Organisation Name Mission Statement Organisation Type Ownership Type Operation Type(s)

Reading Company Information Business Ownership Industry Classification http://uk.finance.yahoo.com/ http://news.bbc.co.uk/1/hi/business/companies/default.stm Business Ownership http://www.bbc.co.uk/education/guides/z4br87h/revision Industry Classification http://www.bennett.karoo.net/topics/industrytheory.html http://www.bbc.co.uk/schools/gcsebitesize/business/aims/aimsandact ivitiesrev3.shtml

Exam Question 1. Most schools and colleges are examples of public service organisations. a) Describe what is meant by a public service organisation. [2] b) Give two other examples of public service organisations. [2] c) Give one example of a type of commercial organisation and describe the service it provides [3]