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You may notice that many assignments are written in response to a given brief. These should be available soon.
This assignment is unusually long, it is perhaps too long considering the performance criteria that it is covering. If you do assignments that are too long you may be penalised in the "Quality of outcomes" grade.
This assignment is to provide me with the evidence that I need to
show an
understanding of the following performance criteria:
2.1.1 Explain objectives of business organisations
2.1.2 Explain the differences between types of ownership
2.1.3 Compare organisational structures
To carry out the assignment it is essential that the task is
broken down into manageable units. I shall do this in my planning
section and in the event that any tasks are delayed or disrupted,
these will be shown in my monitoring section.
Planning
The assignment was set on the 19th October, and it is to be
completed by 24th November. This allows almost 4 weeks to complete
the assignment. I will carry out the performance criteria initially
before completing the tasks, I think that this will probably only
take a week. I shall allow until the end of October, to carry out all
of the planning and performance criteria. Monitoring will be added as
necessary, which will kept together in a section following this.
19th October Assignment Set.
1st November All planning completed and performance criteria
satisfied.
10th November Selected 3 businesses and defined objectives and main
purposes. Also to have shown their different types of ownership and
why suitable for each business.
13th November Written and illustrated about different organisational
structures which are applicable to the businesses being studied.
15th November Written about the differences between the businesses as
a result of comparing them in detail.
18th November Written a report to the developers.
20th November Ensure that all work is neat and that there is an index
to provide easy reference.
22nd November Added any additional research and reported this.
23rd November Evaluation written ready to be handed in.
24th November Deadline
Monitoring
As I have other assignments on the go I have decided to note the
days in which assignment I shall work on and what I will do on that
given day. This can be used with other assignments and also to help
maintain efficient time planning.
My time planning can be seen in Appendix A at the back of the
assignment, this shows what I did on specific days, and how this
assignment has fitted into my already heavy workload and social
life.
Objectives of Business Organisations
Without any sort of objectives a business, will have no direction.
However, objectives in some way will be present, the shareholders or
sole trader may want to make a success of their business, he/she will
have in mind their own personal objectives for the business. Although
if these objectives aren't published or discussed, they may be the
only reason as to why the business is functioning, for example to
make a profit or to look after a person's investment securely.
Without objectives a business will have no purpose to function,
even non-profit making businesses have an objective. All
organisations have some form of goal and they will endeavor to
achieve this goal. Goals and objectives provide a basis for which an
organisation can satisfy the owner's expectations and develop a
strategy which involves making decisions and measuring performance.
The objectives for different organisations will be different because
they will reflect the interests of the owner, or shareholders. When
looking at statements of intent it is usually the case for an
organisation to use various ways of describing what they are trying
to achieve. The statements are shown at different levels ranging from
the rewards to the mission statement. An example follows.
Types of Statements
Mission
This is an overriding statement in line with the expectations of
the stakeholders. The mission statement may apply to outsiders
of the organisation as well as the members of the business.
These statements tend to show a general intent for the
organisation. It will usually focus on how the organisation
will achieve its overall purpose, such as satisfying customer needs.
Goals
Statements of direction in line with the mission. They
extend upon the mission statement by providing several individual
statements indicating how the business will progress. The goals
may serve a number of functions such as:
Objectives
More precise statements which follow goals.
Strategies
Practical measures designed to achieve objectives.
Tactics
Flexible action taken to implement strategies.
Control
The monitoring of actions to make sure that they achieve
objectives. This involves translating objectives into targets
and modifying them if necessary.
Rewards
Stakeholders receive rewards for achieving objectives.
Manufacturing Organisations
Industrial or manufacturing organisations are involved in changing
natural resources or semi-manufactured goods into a tangible form of
output. i.e. building a house or manufacturing a car. A few of the
objectives for manufacturing organisations may be similar to the
objectives for service organisations. For example, the following may
be of greater concern for a manufacturing organisation.
For example DuPont cite eight environmental goals:
- Reduction of toxic air emissions
- Reduction of carcinogenic air emissions
- Reduction of emissions of 33/50 chemicals
- Reduction of hazardous waste
- Eliminate the land disposal of hazardous waste
- Improve energy use
- Cease production of chlorofluorocarbons
- Equip ocean-going fleet with double-hulled tankers
Service Organisations
Some of the best known names in the UK provide commercial services
- Barclays Bank, General Accident, British Rail, Lloyds, to name but
a few.
Whereas many of the objectives of industrial organisations relate
to the manufacture or construction of products and their effects to
the community, service organisations may, similarly have a range of
objectives which relate to their operations in providing customer
services. For example, their objectives may include:
Financial Objectives
The large supermarkets are obvious examples of organisations which
set out to make profits. The profits they make enable them to reward
shareholders, and also to plough money back into the business in
order to improve the quality of their services. Supermarkets operate
in a highly competitive market. Firms that failed to make profits
would not be able to improve their services and would rapidly lose
trade. Most business and commercial organisations are profit
motivated. They may not go all out to maximise profits, but they must
make a profit or shareholders, and people who have lent them money
would lose confidence.
None profit making organisations include building societies, friendly
societies and charities. These organisations do not, strictly
speaking, have a profit motive, but they still create a cash surplus
which is distributed in a number of ways. Such organisations need to
establish clear objectives so that their performance can be judged
against appropriate standards. Without such standards there would be
no way of checking how well an organisation is doing, and how its
performance can be improved.
In recent years there have been more and more organisations building
the profit objective into their overall objectives. For example,
charity shops today operate as commercial enterprises rather than
casually run voluntary services. Increasingly, there is an
appreciation of the importance of using scarce resources efficiently.
For example, what would be the purpose of having an Oxfam shop on the
High Street if it ran at a loss? It certainly wouldn't help famine
relief. Organisations like building societies have increasingly
switched to becoming public companies with shareholders, e.g. the
TSB.
In the public sector it is unlikely that the overriding objective of
any organisation will be pure profit maximisation. However,
organisations such as schools, colleges and hospitals will have
financial objectives based on:
Public service objectives
As well as having objectives which directly address the areas of
profitability and market share, objectives may be concerned with
public responsibilities which the organisation accepts that it has
towards society and other stakeholder interests. For example IBM
publish a Stakeholder Report in which they summarise information
under the following headings:
Employees
Population, earnings, graduates recruited, student
unemployment, equal opportunities etc.
Customers
Customer satisfaction, price/performance, customer training,
customer visits, etc.
Suppliers
Amount of business, percentage of expenditure, investment in
land and buildings, major construction projects, etc.
The Community
Secondments to community projects, support for enterprise
agencies, contributions to charities, youth training, sponsorship,
community projects, etc.
Though social objectives of this kind are considered to be of
great importance, it can be argued that they may confuse managers
over standards of performance so that they focus upon these areas
instead of increasing profitability and market share.
Another area for corporate objectives is that of the environment
and safety. Over recent years many organisations have set minimum
acceptable environmental standards. For example, Cadbury Schweppes
identify eight key commitments as part of their objectives:-
Public sector organisations have rather different objectives from
those of commercial organisations. Their problem, however, is not
primarily concerned with profitability or market share, but more how
commercial they should become in order to carry out their role for
society. In doing so they have to meet the expectations of taxpayers,
as opposed to shareholders, and provide them with value for
money.
Private sector
The economy is made up of all organisations in the public and
private sector. The private sector includes organisations which are
owned and operated on behalf of private individuals. As we shall see,
these organisations range from small one-owner businesses to vast
multinational corporations. Private sector organisations include sole
traders, partnerships, companies, franchises and co-operatives. Some
private sector organisations are concerned with making goods - we
call these industrial organisations. Others concerned with selling
are called commercial organisations. Those that deal with banking and
insurance are called financial organisations.
Public sector
All organisations in the public sector are in some way controlled
by central or local government, or controlled indirectly through some
form of government-created body. The government will usually provide
a budget for public sector organisations through money collected from
taxpayers. An example of central government controlled organisations
would be; DSS, NHS, Education and the Armed Forces to mention but a
few. Local government controlled organisations would include business
activities provided by local councils such as car parks, leisure
services and swimming pools.
Public corporations are owned by the government on behalf of the
people. An example of one is the British Broadcasting Corporation
(BBC), such organisations produce goods and services to serve all the
people of the country.
Quangos, (quasi-autonomous non-government organisations) are elected
public bodies. They are run and controlled by boards of directors to
manage a particular initiative. Local Training and Enterprise
Councils (TEC's) are responsible for providing training opportunities
and schemes on behalf of local employers. Quangos are created by
parliament, which determines their powers and procedures. Quangos
reflect a compromise between central government control and the needs
of independence and flexibility of private sector organisations.
Ministers have no direct control other than appointing the
chairman.
From the different types of organisations that there are it is
clearly obvious that there will be different types of ownership. The
most common form of business ownership is the sole trader. It is easy
to set up, and their is no complicated paperwork to work through.
Decisions can be make quickly and the sole trader will deal
personally with his/her customers and employees. The sole trader will
be working for their own objectives and may base their decisions on
such objectives. For example if the sole traders' main objective is
to make profit, then they may decide to take risky decisions in the
hope of gaining more money.
However, there are disadvantages to being a sole trader as well. You
may have to work long hours, what if you need a rest or become ill?
Decisions will be solely your responsibility and may not be the
correct ones, whereas if several people had to make the decision it
would be more thought-out. Should the business fail, the sole trader
has limited liability and therefore may end up loosing their personal
belongings to pay off their debts. The sole trader will have to
provide all the finance needed for the business themselves as they
would not be allowed to share in the business without making it a
partnership business. The sole trader has to have a lot of skills to
look after the business, a jack-of-all-trades. A personal able to do
a trade may not necessarily have a good head for business.
Partnerships
A partnership business can range between two and twenty partners.
Professional partnerships may have more. People in partnerships can
share skills and also the workload. It should also be easier to raise
capital. Partnerships are usually set up by writing out a deed of
partnership which is witnessed by a solicitor. This sets out
important details such as how much each partner should put into the
business and how the profits or losses shall be shared, and also the
responsibilities of each partner.
Partnerships are particularly common in professional services, such
as doctors, solicitors or accountants to name but only a few. A
partnership may also take the form of husband and wife as this is
quite common. Similar to sole traders the partners in a partnership
business have unlimited liability, so should the business run into
debt, the partners would have to sell their personal belongings to
pay off the debts owing. Decisions may take a long time, because you
would have to make sure that all the partners were unanimous in their
decision. One main disadvantage of partnership businesses is the fact
that one of the partners may be working harder than the other(s), and
argue that the other partner('s) isn't working as hard.
Private companies are usually smaller than public ones and are
usually owned by families. There is no maximum number of shareholders
in a private limited company but there must be at least two. Shares
are not allowed to be sold on the stock exchange, and usually shares
can only be bought with the permission of the board of directors.
Private limited companies may find it easier to gain extra finance,
because they can sell more shares to create extra money. Shareholders
will also have limited liability, so in the event of the company
collapsing, the shareholders will not be responsible or held
accountable for any debts that may be incurred.
The main disadvantage compared with unlimited-liability businesses is
the fact that they have to share out the profits with the
shareholders and also decisions cannot be made quickly as the board
of directors may need to be informed.
SOLE
LIMITED
TRADER
PARTNERSHIP
COMPANY
1. Are you selling to large businesses?
If YES, score and go to 2
0 0 2
If NO, go to 2
2. Are you likely to be buying substantial
supplies from other businesses on credit?
If YES, score and go to
3 0 0 2
If NO, go to 3
3. Do you have another person you
want to start the business with?
If YES, score and go to
4 0 1 1
If NO, go to 5
4. Can you trust that person completely
to make decisions on your behalf, to pay
the tax bill and debts?
If YES, go to 5
If NO, score and go to
5 0 0 1
5. Are you willing to meet the more
onerous reporting requirements for a
company?
If YES, go to 6
If NO, score and go to
6 1 1 0
6. For the effect of national insurance
contributions
Score and go
to7 2
2 0
7. Do you expect to pay higher rate tax
on your profits (that is, taxable profits of
£24,300 for 1995-96)?
If YES, score and go to 8
0 0
2
If NO, go to 8
8. Want to pay as much as possible into
a personal pension scheme - for example,
if you are forty or over, say?
If YES, score and go to 9
0 0
1
If NO, go to 9
9. Is there some large asset in your
business, on which you are likely to make
a capital gain?
If YES, score and go to 10
1 1 0
If NO, go to 10
10. Is raising money, other than by
overdraft, an important consideration?
If YES, score and go to 11
0
0
2
11. Might you want to sell part of your
business at a later stage?
If YES, score
0
0
1
This quiz was copied from the Lloyds Bank Small business guide.
Anyone thinking of setting up in business but who is not sure of what
sort of business to be, should go through the questions above and
circle the numbers for each question you agree with. At the end add
up the total number of points under each of the three columns and
whichever is the highest is the best business for you. It is stated
that this is only to be used as a rule of thumb.
A public limited company may have its shares sold on the Stock
Exchange or on the Unlisted Securities Market, if the company does
not meet the criteria set by the stock exchange. A major advantage of
being a public limited company compared to the other businesses
detailed above is the fact that much more revenue can be made quickly
through the public sale of shares. However, a disadvantage of this is
that, should a particular investor purchase over 50% of the shares,
then that person will have a major contribution as to how the company
is controlled and operated. When another company purchases over 50%
of the shares of another company it can be seen as a take-over or as
a merger if arranged with all parties agreeable.
In America over one-third of all retail sales are made through
firms operating under the franchise system. It is a form of business
organisation that is becoming increasingly popular in the United
Kingdom.
Franchising is really the 'hiring out' or licensing of the use of
'good ideas' to other companies. A franchisee grants permission to
sell a product and trade under a certain name in a particular area.
If I have a good idea, I can sell you a license to trade and carry
out a business using my idea in your area. 'The person taking out the
franchise puts down a sum of money as capital and is issued with
equipment by the franchising company. The firm selling the franchise
is called the franchisor and a person paying for the franchise is
called the franchisee. The franchisee usually has the sole right of
operating in a particular area.
This type of trading is common in the fast-food industry, an example
of which is McDonalds and Pizza Hut. Further examples are Dyno-Rod
(in the plumbing business), Body Shop and Prontaprint.
Where materials are an important part of the business (e.g.
hamburgers, confectionery, hair salons) the franchisee must buy an
agreed percentage of supplies from the franchisor, who thus makes a
profit on these supplies as well as ensuring the quality of the final
product. The franchisor also takes a percentage of the profits of the
business, without having to risk capital or become involved in the
day-to-day management.
The franchisee benefits from trading under a well-known name and
enjoys a local monopoly. Training is usually arranged by the
franchisor. The franchisee is his or her own boss and takes most of
the profits.
Co-operatives are increasingly popular as a means of business
organisation. At one time they were only found in agriculture and
retailing, but in recent years the biggest growth areas have been in
service occupations and in small-scale manufacturing.
The basic idea behind a co-operative is that people join together to
make decisions, work and share profits. There are many different
types of co-operative; the three most commonly found in business are
Retail co-operatives, Producer co-operatives and Marketing
co-operatives.
Retail co-operatives, these are also called consumer co-operatives.
They follow the points outlined below:
There are many different types of a producer co-operative. A
worker's co-operative, for example, is one that employees all or most
of its members. In a worker's co-operative members:
This can be a fairly good way of raising finance, although a
down-side to this is that often it difficult to see who is making
decisions, in such cases it may be necessary to set up a management
structure.
These are most commonly found in farming areas. The farmers
collectively set up a marketing board to be responsible for among
other things, grading, packaging, distributing, advertising and
selling their produce.
All businesses and large companies have a specific structure, this structure shows all the following connected with the business:
The above terms are quite self-explanatory although, the span of
control means, the members of staff which are beneath a specific
person, in other words the people of whom he/she is in charge of. The
chain of command is the root from the top of the structure to the
bottom and the pattern which it follows.
Depending on the individual business they will have their own method
for dividing up the workforce. The five main ways for dividing up the
business are by:
Division by function
This is the most common method of organisational structure.
It illustrates the levels of responsibility and command. An example
is shown below:
The advantages of such an organisational style are:
However, there are some disadvantages as well:
Division by product
company that produces and manufactures different products may
have divided their company structure in to separate divisions for
each product. For example Nestle Kit Kat and Yorkie Bar may have been
separated, so that there is a complete production team specialised in
the production of one product and a marketing team etc.. for that
individual product. Whereas in the past or in other companies there
would be only one production team that would produce all of the
different products and one research team that look at all
products.
Advantages of this type of structure are that:
However, there are also disadvantages to this sort of structure as
well:
Division by process
Most manufacturing or service organisations consist of
different processes and levels. For example a typical manufacturing
company would have a storage department, manufacturing department,
freezing department, packing department and a despatch department.
This consists of five different sequences. A company that is divided
by division of process, would have teams of specialists at each
stage, like those above. Division by process will only work
effectively if there is a steady flow from one process to the
next.
Advantages of division by process are that:
Disadvantages of division by process are that:
Division by geographical area
Some international companies such as Coca-Cola will be
divided by geographical area. This will mean that they will have
branches across a large area, possibly world-wide.
Being organised geographically makes it easier for a large
enterprise to respond quickly to local issues and problems and to
manage its strategies to local conditions. For example Coca-Cola has
a division in Asia, when the company produced some ice-cream boxes
they had a white colour. The Asian division soon responded because
the colour white in Asia is a sign of death. If there had been no
division in Asia, this could have seriously affected Coca-Cola's
reputation over there.
Advantages of division by geographical area are:
Disadvantages of division by geographical area are:
Division by type of customer
This type of division is particularly useful when a company
has to treat different types of customer differently. A large
organisation may look after their retail customers different than
they would individual customers. Banks are a good example of division
by type of customer. They have a foreign currency area, mortgage
desk, account services and business advisors to mention but only a
few.
Advantages of division by type of customer are:
Disadvantages of division by type of customer are:
A company must be organised effectively, so that it can get the
best results from its employees. The are several ways in which to
organise a business and these very much depend on what the business
does and what the type of ownership is.
A company can have the following structures:
These can then be devised incorporating certain divisions as
described above.
Matrix structure
This is the most modern structure. It can be used to group
staff together, so that they can work to create and produce a product
or service. In such a matrix it will be possible that each member
will belong to two or more groups. A matrix is therefore a
combination of structures which enables employees to contribute to a
mix of activities.
A matrix enables a company to focus upon a number of ideas at a time,
it can be flexible to respond to markets where there may be an
increase in demand for new products or services. A disadvantage of a
matrix structure could be that employees lose sight of their aims and
objectives. Also there may be more than one chain of command, which
may lead to power struggles and contradictory orders.
Flat structure
A flat organisational structure will consist of a few levels
compared to a vast number in the tall structure. There will usually
be highly skilled workers in the chain, doctors, solicitors are a
good example of flat organisational structures. A flat organisational
structure will look like the image below.
Tall organisational structures
This type of structure is the most commonly used in every day
companies. It shows the chain of command, like the flat
organisational structure. The chances are that the people at the
bottom of this structure are semi-skilled or unskilled and require a
lot of supervision. Alternatively criticisms have been made of some
organisations with too many layers (levels) of management (excessive
bureaucracy). An example would be the DSS. This shape is highly
traditional and heavily criticised with new, more dynamic matrix
structures being more fashionable.
Organisational structures are the framework for a business and
they show the relationship between workers and their divisions of
work. The organisational chart will show:
In order to choose which type of organisational structure for a
business to have the following will have to be known:
I have now completed all of the performance criteria needed and I
have kept to my planning. I shall now choose three businesses from
the businesses in the business park.
Today is Friday 10th November, I will also mention as to why I chose
the businesses that I choose. I will find it easier just to re-read
the assignment brief, so that I know exactly what I have to do. Below
I have written some rough notes that show basically what I have to
achieve in the assignment.
Rough Notes and basic planning.
Report to developers of business park, they may wish to build
extra units in the park.
Report Criteria:
Include main purposes and objectives of three businesses.
One public sector company
Two private sector companies
All different form of ownership
I want to look at objectives and purposes of the following types of
business organisations as I feel that they will be easier to compare
and note the differences between them.
Sole Trader
Public Limited Company (Plc)
Public sector - Public Corps
Local
Govt
Nat
Govt
Quango
I have looked at six businesses in the business park, from these I
will work out what type of ownership they have. By doing this, it
will make sure that the three businesses I finally compare and
examine in greater detail will definitely have different types of
ownership.
Metal Pressers
Plc Public
Limited Company
Candy of Distinction
Private
Limited Company
or
Partnership Business
St Roger's Community Trust
Quango
Child's Play Plc
Public
Limited Company
Technolog
Sole
Trader
Loamshire Health Authority -
Medical Equipment Store
Public
sector - National Government
From the six businesses I have chosen the following three.
Private Sector
Plc
Metal Pressers Plc
SoleTdr Technolog
Public Sector
Quango St Roger's
Community Trust
I have chosen Metal Pressers Plc because I feel that they have a
large scope for expansion and development when compared to Child's
Play. I omitted Candy of Distinction because I wasn't sure whether or
not this was a Partnership firm or a Private limited company, so I
felt it was safer to miss this one out. I have included St Roger's
trust because compared to the other business in the public sector,
the community trust has a lot of scope should they be successful
finding an investor. Child's play wasn't just omitted because I
couldn't decide its type of ownership, but also because I feel that
there are too many children's superstores in the country and also I
don't know very much about children's toys, which would probably help
here. I have chosen Technolog because it is the only sole trader in
the business park and as a sole trader there will be a lot of scope
for expansion. I was in two minds whether or not to choose the
Medical Equipment store from the Loamshire Health Authority because
the business looked interesting in terms of problems and suchlike,
but as I have mentioned I have chosen the community trust.
Now that I have chosen the three business organisations I will need
to look at their main purposes and objectives; in the short term and
in the long term (next five years). How they each differ in
types of ownership and how this has affected each of businesses
objectives, is another point that I will have to consider. The task
also requires me to compare organisational structures using charts
and notes, this will be quite demanding and will therefore require
more time to spent on this.
In my planning I had written down that I should write and illustrate the different organisational structures used in the businesses selected. I think that the assignment would flow better if this was shown after a description of each of the businesses was done. Today is Monday 13th November and I feel that I am still keeping to the planning well. With this minor change I will try to do a organisational chart for each of the businesses, as well as a description. Therefore, my planning should remain correct and there will be no need to re-evaluate it.
Metal Pressers Plc
The business is an old established firm of pressers of small metal
components. The components are designed and used for the main buckles
in safety harnesses and seat belts. They do not manufacture any other
form of metal components (Possibly they don't have the equipment).
The components are always for vehicle harnesses and seat belts. Once
the components are made they are sent to a safety harness
manufacturer where the whole product is made in as nearby city. Metal
Pressers Plc have never made the complete product themselves. They
have noticed that the demand for the small metal components increase
when the sales of cars do.
Fortunately, there is a local steel stockist, which is part of
British Steel this provides most of the steel blanks needed by the
firm. This is helpful because it should save on transporting the
steel over great distance which would be expensive. Should Metal
Pressers Plc expand they will need more steel, and the local stockist
may not be able to supply the quantity needed by Metal Pressers Plc,
so this will have to be taken into account if considering changing
location.
Old fashioned equipment is used and skill levels of staff are fairly
low. To maintain and improve upon their position in the market they
will need to invest in new equipment to produce the small metal
components in greater quantity, as well as improved quality.
There is a relatively small workforce for a public limited company of
twelve of which five are skilled operatives. This is good in one way
because it means that staffing will be cheap. However, in the thought
of expanding I would think that more staff would need to be employed.
The labour force has remained unchanged in the past five years.
The company has to work to usual Health and Safety Executive
standards. It is vital that the standards are maintained, because
otherwise the company would could seriously damage its reputation, as
lose its orders.
The company depends almost entirely on the motor industry.
Increasingly its products end up in the local manufacturers cars and
vans (Samurai Cars Plc). If the company makes the right sales
contracts it could do well otherwise it may have difficulties. The
company has a good reputation and with this raising extra finance may
not be seen as a problem.
This business looks very interesting and I feel that a lot of work
should be spent on updating this business and it should be improved
to gain a better grip on their market in order to achieve larger
contracts. The business is a Public Limited Company and therefore
shareholder will expect that there investment is well looked after. I
would expect shareholders would welcome any improvements to the
business. However I see that the business appears to be running in an
old fashioned way. The board of directors are probably old and set in
their ways or alternatively the company is having problems in raising
finance.
Objectives of Metal Pressers Plc
Main purpose
The main purpose of this company is to please the shareholders, so
I am lead to believe that the company will be out to gain a profit so
that as a result the shareholders will gain a dividend. The purpose
of the company is to manufacture small metal components to be used as
main buckles for safety harnesses.
Short Term objectives (the next year)
The short term objectives are as follows:
By obtaining a sales contract over the next year this will
financially help the business survive and go towards costs of new
equipment. A new sales contract will ensure that employees know that
their jobs are secure a matter that many employees are concerned
with.
Investigating into the costs of improving their equipment will be
necessary so that if any extra finance is needed the company will
have an idea of exactly how much.
Should the business expand and gain more contracts it will need more
raw materials to meet such demand. In preparation the business should
find a specific source for more materials, its location may be
important too. If it is too far away from the factory the business
may have to be located closer to save on transporting costs.
It is important that the workforce is maintained and the unskilled
workers should be trained because they will have more responsibility
in the event of the business expanding.
In the possibility of the company growing it is important that the
existing staff are good at working together, so therefore over the
next year the staff will have teamwork training which may include
sports activities. It is felt that this is necessary for the business
to survive in the long term.
Finally, the last of the short term objectives, which should really
be the first is the matter of improving the company's image. The
company has a good reputation locally, this should be made national.
In the short term the company will produce a new logo and modernise
the current sales reception and buildings if necessary. By the end of
the year the company will have a well known national image.
The mission statement for the business will be released with the new
image nationally. The mission statement will be "Metal Pressers press
on to the future, keeping you safe." This mission statement will be
nationally advertised, so the company will get national
recognition.
The short term objectives are very different for the business as it
sees that it must change with the times. It will be a very costly
year with advertising and maintaining the short term objectives. Once
these objectives are achieved the business can start to go from
strength to strength in the long term.
Long Term Objectives (the next five years)
The long term objectives are as follows:
The major long term objective is to gain more sales contracts,
with expertly trained staff working on a sales team, the company
should have much improved chances of gaining sales contracts. With
the company image nationally known there should be a much larger
number of customers and therefore the company sales should benefit.
This is the key objective and all other objectives will work to
achieve this.
The levels of staff will have to be increased to cope with the
expected demand. The existing staff members will have been trained
with management skills and also be specialist in their area of work.
There will be more sales outlets and staff may work overseas in order
to make sales with key transport industries. The manufacturing team
will also increase, along with administration and marketing
departments.
Staff will have been trained efficiently in the short term and in the
long term they will be able to manage new members of staff within
their departments as well as show them new skills.
There will be a national advertising campaign, so that all of Metal
Pressers' customers are aware the company exists. This should be the
main way for targeting new customers and should prove successful.
Once the national advertising campaign has taken off, the share
prices may increase. If Metal Pressers are not on the London Stock
Exchange they should now meet their criteria with the increased
turnover.
Modern equipment will be installed to cope with the high demand that
the objectives hope to achieve. The old equipment will be sold, and
money may need to be borrowed to pay for the new machinery.
After five years the company should have the potential to be able to
create the whole safety harness so the company will be making sales
direct to car manufacturers instead of through another company.
The Health and Safety standards will have to be maintained, otherwise
it would seriously damage the image given by the company and may have
serious implications on the company's future.
The company has got very dramatic ideas and some of which are very
risky, if the company manages to achieve these objectives the
shareholders will reap the benefits in dividends.
Had this business been of a Partnership ownership, it would have not
taken so many risks in its objectives, because the business would
have carried unlimited liability and therefore the owners could have
lost all of their personal belongings. A Private Limited Company may
have taken similar risks to those detailed above. A Sole Trader would
not usually sell to Public Limited companies so its very unrealistic
to compare a Sole Trader to Metal Pressers Plc.
Organisational chart for Metal Pressers Plc
It mentions in the brochure that Metal Pressers Plc has a
workforce of twelve, I have interpreted this to mean that there are
12 people employed by the company. It says that 5 of which are
skilled operatives so I would think that they work in the
manufacturing process. The other seven employees will either work in
the purchasing department, sales department, managing director, or be
on the board of directors.
The organisational structure is flat at the moment but in the long
term with the changes that would take place I would expect the
organisational structure to change to be a tall one.
Technolog
Technolog is a new entrepreneurial operation essentially built up
around one man. The business develops specialist computerised
equipment for energy management in furnaces and kilns. The business
produces small quantities of expensive equipment assembled to
customers orders from bought in components and sub-assemblies. Most
sales are to British Steel or a local brickwork company. Some sales
come from overseas, especially the Far East, but competition is
fierce.
The Sole Trader purchases components and sub-assemblies generally
from North America and Japan. The Sole Trader has a factory unit
which is very well equipped on a small scale. The equipment is mostly
of Japanese or North American origin. The Sole Trader uses the
factory unit for final assembly, which is fairly routine and also
uses it for some of the initial design which is highly specialised.
This is irregular work which is done depending on demand.
The owner of Technolog is an international expert in his field. He
employs a couple of specialist scientists and technicians. Other
unskilled workers are employed on short term contracts for final
assembly work.
Apart from the Department of Energy regulations (which help to sell
the product in the UK), the main legal aspects to which the company
must pay attention to are DTI rules for exporters and anything which
affects the exchange rate.
If British Steel or the brickwork company rationalise any further,
the company is in trouble. The owner is thinking about selling out to
an American company. The business also takes on technology students
for training placements.
This business is very specialised and the Sole Trader has started it
and found that there are so far very few customers and with fierce
overseas competition. The Sole Trader is considering selling up, in
my opinion this will be a bad idea. The Sole Trader should try to
pursue the business. He is obviously an intelligent person in his
field of work and as a result should build his business like he had
first intended.
Objectives of Technolog
Main Purpose
As a Sole Trader the owner of Technolog has set up in business in
order to make money. The company's purpose is produce specialist
equipment on energy management in furnaces and kilns. The equipment
is very technical and in the UK Technolog has had only a little
success, the purpose is to help the environment and help maintain
fossil fuels.
Short Term objectives (the next year)
The short term objectives are as follows:
Making sales is what Technolog need to survive, the company cannot
rely on British Steel and the brickwork company for all of its
business. Advertising or providing a conference to companies which
could benefit from the equipment would be a good idea. A conference
may not cost Technolog anything if the company is sponsored or allows
other companies to attend for advertising purposes.
Technolog would benefit greatly if the Department of Energy
Regulations were able to help them. Technolog's equipment will help
protect the environment a little by maintaining efficient use of
energy. Therefore, Technolog should be given help to sell its
equipment, the owner may even be eligible for a government grant.
The Sole Trader should also approach British Steel to try to get a
sales contract from them, if he can persuade them to use his
equipment he will gain plenty of sales not just from Technolog but
also from other companies once Technolog has built a reputation.
Technolog must really get into business, it must become well known
amongst it possible customers. If the Department of Energy
Regulations can help, they may be able to find Technolog further
customers. Technolog has found the overseas markets very competitive,
which makes me believe there is plenty of demand for their sort of
products overseas, so maybe in years to come the UK companies will
need the equipment that Technolog provide.
Long Term objectives (the next five years)
The long term objectives for Technolog are as follows:
The major long term objective of Technolog is to boost its sales
to a maximum. Technolog will make its presence in the UK well known
to all of its potential customers, so that if regulations are made
more stringent these companies will approach Technolog.
Demand will have increased and Technolog will need more space to
assemble their equipment. The Sole Trader will also need more space
and preferably a suitable environment for him to carry out his highly
specialised designs.
In response to the demand of the companies wanting Technolog's
equipment, the business will need to purchase more components and
sub-assemblies, therefore it would be cheaper if these were all
purchased in bulk.
The Sole Trader of Technolog must really work hard to make the
business a success. Unlike the business of Metal Pressers Plc,
Technolog must be cautious when spending as the Sole Trader has
unlimited liability. However, Technolog must be a little risky in
order to succeed. Technolog may have a better chance of success if it
becomes a Partnership business, if the owner can find some people
with a better knowledge of business then himself and in the event of
expansion he may need more capital. Should Technolog wish to become a
private limited company, it would have more capital available and
therefore would be able to take more risks in spending, with the
additional advantage of limited liability.
Organisational chart for Technolog
The organisational structure for Technolog is a flat one like that
of Metal Pressers Plc. Most of the workers are at an equal level. The
assembly workers are only employed on short term contracts when final
assembly work is needed. The actual structure may be different from
that shown above, but from the details in the brochure this is what I
feel is the correct organisational structure.
St Roger's Community Trust
This is what is called a Quango, it is briefly explained in my
assignment on page 8. The trust is a church community association
based on local housing estates. The factory unit that they have in
the park is used for the young unemployed. This scheme involves
renovating second hand furniture whilst providing skills
training.
The factory unit is essentially a training centre. The second hand
furniture renovated is distributed free to those who need it locally.
Schemes change every month depending on the trainees referred to it
from the local training agencies.
The furniture that is renovated usually goes to social security
claimants. Some is sold to local second hand stores. The main market
served is the local Training and Enterprise Council (TEC) and also
the Community Services Council who provide financial and other
support
I feel that there is no need to write an individual report
alongside what I have already written about the three businesses. I
would use the writing on those as the actual report. I also feel that
there is no need for an index as the work is presented systematically
and logical. Today is 18th November, I will ensure that I will now
write an evaluation for the assignment. Therefore the assignment can
be handed in early.
Written elsewhere in handwriting.
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