Btec National Business Level 3 Year 1 - Exploring Business Activity
Unit 1 Different types of business activity and ownership
Pass 1
A) Type of businesses activity
If I live in a city of any size especially in an area where new people are moving in people are increasingly using the Internet to find local businesses. Microsoft can't be local because people search jobs by region: United States, Europe and Asia etc. Oxfam is a local as well such as located in Watford High Street.
Some of the businesses that can be helped by local Internet marketing include: chiropractor, computer retailer, travel agent, locksmith, massage therapist, insurance agent, real estate agent, mortgage broker, maid service hardware retailer, plumber, auto repair etc. How to use the Internet to market a local or regional business.
There are many businesses in UK. It is located sites across a country. For example, Microsoft Company is found in Cambridge that is UK. Of course Oxfam is collecting money to save people and it is every where in the UK, i.e. London, Hertfordshire, Oxfordshire and Birmingham etc. they will be called National Businesses.
An International business company is a legal entity incorporated in a tax haven which is free from all local taxes (except small fixed annual fees). Typically the IBC cannot conduct business in the country of incorporation. Oxfam International is a confederation of 13 organizations working with over 3000 partners in more than 100 countries to find lasting solutions to poverty and injustice. Microsoft International Careers Newsletter, a free quarterly e-publication that will give us timely information on career opportunities at Microsoft, i.e. from Europe somewhere else.
Both Microsoft and Oxfam are global companies, but Microsoft careers can take us to a global presence. They offer opportunities around the world to make an impact with the next generation of technology they're building today. They invite us to explore, dream big and learn more about what they can offer us. Oxfam is a development, relief, and campaigning organisation that works with others to overcome poverty and suffering around the world, these are the largest global organisations.
Public, Microsoft operates in public businesses in the world wide. This meaning of a "public company" comes from the tradition of public ownership of assets and interests by and for the people as a whole (public ownership), and is the less-common meaning in the United States.
In the UK there are vital public organisations that left. For example, of public businesses include:
* Customs and Revenue - collecting our people tax.
* The National Archives - The body is responsible for looking after government records and records from the courts of law.
Private, Microsoft Corporation is an American multinational computer technology corporation with 79,000 employees in 102 countries around the global. Private companies may be called corporations, limited liability companies, partnerships, sole proprietorships, business trusts, or other names, depending on where and how they are organized. Each of these categories may have additional requirements and restrictions that may impact income tax liabilities, governmental obligations, employee relations, marketing opportunities and other business decisions. Private businesses include: For Example,
* Virgin, Intel, Tesco, Cadbury, Schweppes and LastMinute.com.
Not-for-profit/voluntary, Oxfam operates in voluntary business; it is a confederation of 13 organizations working with over 3000 partners in more than 100 countries to find lasting solutions to poverty and injustice. these are the businesses are to set up to make a profit. For example, a voluntary business operates on quite various lines. I am sure about `not-for-profit` business. It will to set up to organised staffed and run by people who are working purely on a voluntary basis, usually for a nice cause. For examples,
* Voluntary organisations ate Women's Royal Voluntary Service and Voluntary Service Overseas.
Sectors of business:
The primary sector involves many businesses which produces and obtain raw materials and natural products from forest, land, mountain and sea. That can be produce for other industries. Major business is Microsoft surrounded anywhere in the world, but it can't be this sector because it is manufacturers and it can sell goods and services as well. Oxfam is collecting raw materials like clothes, shoes, foods from agriculture etc, services can be donations.
The secondary sector industries Secondary industries engage (interest) in the manufacturing and production of goods. The word "secondary" implies that such companies are engaged in the second stage of economic activity. They use the natural resources of the primary industries (and possibly the goods of other secondary industries) to make products. Secondary industries
Microsoft can be as well but they build new software's. Oxfam is not manufacturer, but they get clothes or shoes from the manufacturers as a charity.
The tertiary sector of industry involves the provision of services to businesses as well as final consumers. Services may involve the transport, distribution and sale of goods from producer to a consumer as may happen in wholesaling and retailing, or may involve the provision of a service, such as in pest control or entertainment. E.g. Microsoft is selling software or other services etc and Oxfam is selling goods like clothes and services like donations etc.
B) Business purposes
Reason why businesses exist
Microsoft Corporation is an American multinational computer technology corporation with 79,000 employees in 102 countries and global annual revenue of US $51.12 billion as of 2007. It develops, manufactures, licenses and supports a wide range of software products for computing devices. Headquartered in Redmond, Washington, USA, its best selling products are the Microsoft Windows operating system and the Microsoft Office suite of productivity software. These products have prominent positions in the desktop computer market; with market share estimates as high as 90%.
Products and services supplied for:
> Profit - It is one of the businesses that are illustrated by the growth of the. Microsoft profits increasing day by day. They increased in an online discount that they make benefits. Oxfam Control of its coffee names through trademarking would give Ethiopia a fairer share of the profits of the global coffee trade.
> At cost and below cost - Many businesses not always to seek and to sell their goods for profit. Sometimes they are willing to do so `at cost`. It will be supplying at cost happens when money taken from selling a product is equal to the cost of supplying that product. For example, Microsoft or some other businesses like this one; they may offer software's to schools low cost seats at Educations Subjects fixtures to increase interest in the jobs.
The businesses are able to supply products at below costs of production. It may be because the business is trying to generate interest in a new product. Microsoft rose to dominate the home computer operating system market with MS-DOS in the mid-1980s. The company released an initial public offering (IPO) in the stock market, an initially they sell it at below cost price.
Supply products and services in response to demand to:
> Consumers - some of the products will be supplied straight to consumers. For example, Sainsbury's organises the supply of groceries, including tinned, chilled, frozen, and fresh produce. People to get these products from Sainsbury's have to organise a supply chain of activities. Also this business has a good idea, to supply chain is organised through a computer ordering system that tells them how much is in stock and when new order should be made.
> Other businesses - there are many goods are supplied by businesses to other businesses. E.g. builders' merchants supply builders with bricks, cement, tools and equipment. These demand industrial goods and commercial services to enable them to continue with production.
> Central government and local government agencies - many other goods are supplied by businesses to the government. E.g. private stop collecting firms will take away our bins and other forms of rubbish. The local council has brilliant services to pay them to do this. The local council gets its funds for this and other purposes by charging taxes. Using taxpayers money such as public spending to build, run and maintain public services, i.e. hospitals, roads etc.
C) Business owners
The public sector includes everything that is owned by the government. This is things like the army, the police force, and most schools and hospitals. Public means that they are owned by the government for the benefit of everyone. It has wider objectives than profit often has wider social service aims. The government assists Oxfam to give the charities to save from homeless, poverty and disease etc.
The private sector, Microsoft is owns by Bill Gates, which he is the main co-founder. Contains all the businesses owned by the private individuals. Private means that these businesses are run for the benefit of the people who own them. Profit is often major spinning force. Private sector organisation is Microsoft etc.
The voluntary sector of a nation's economy consists of those entities which are not for profit and yet, at the same time, are not agencies of the state - e.g. charities, volunteer community centres and religious organizations. Oxfam has a number of successful fundraising channels in addition to its shops. Over half a million people in the UK make a regular financial contribution towards its work, and vital funds are received from gifts left to the organization in people's wills. They may, in some countries, be subject to state scrutiny if they wish to qualify for charitable status. Voluntary sector organisations are Oxfam.
Types of ownership
Sole trader - most small businesses are sole trader. Examples include plumbers, hairdressers, newsagents and fishmongers. Bill Gates didn't need to do anything except start trading they are dead easy to set up. Get an idea and he's in business. He gets to be my own boss. He is alone to decide what happens to any profit. He has to work long hours.
Partnerships - partnerships are not that common, but the business gets them a lot in jobs like accountancy, solicitors and doctors. By law a business can have between 2 and 20 partners. Partners have an equal say in making decisions and an equal share of the profits unless that is they an agreement called a deed of partnership that says different. More owners means more ideas, and more people to share work. More owners means more capital (money) can be put into the business. In 2006, Bill Gates announced a two year transition period from his role as Chief Software Architect, which would be taken by Ray Ozzie, and planned to remain the company's chairman, head of the Board of Directors and act as an adviser on key projects.[44] As of July 2007, Windows Vista is Microsoft's latest operating system, released in January 2007. Microsoft Office 2007 was released at the same time. So the Microsoft has four partners.
Private and public limited companies - private means that shares can only be sold if all the shareholders agree. The shareholders are often all members of the same family. Private limited companies have Ltd, after their name. The big benefit over sole traders and partnerships is limited liability. Google and Yahoo have created billion dollar businesses primarily based on advertising revenue generated by providing search facilities for their users. Microsoft were a little late seeing the potential in this market and are now working hard to bring themselves up to speed. The new live search technology is the latest advance from Microsoft in their attempts to challenge Google and Yahoo for supremacy of the search market.
Public means that Microsoft can have anyone can buy shares in the company - If they can find someone who wants to sell them. Public limited companies have PLC, after their name. Firms generally become PLCs when they wish to expand. Much more capital can be raised by a PLC than by any other kind of business that helps the company to expand and diversify.
Franchises - for years some manufacturers have given other companies the right to sell their products. For example, Microsoft manufacturers sell their software's through dealer franchises. These franchises trade under their own name but advertise that they sell a particular manufacturer's products. The franchiser (brand owner) uses this to increase outlets and markets while the franchisee gets a ready made a business with proven goods.
Government departments and government agencies - they are the businesses who owned by the people of UK and run their benefit. The government is elected to set policy for agencies. The department for Customs and Revenue works on behalf of the government and is staffed by civil servants, known as customs and revenue officers. Their jobs are to take out income tax and other taxes on behalf of the government, to collect repayments on student loans, and to make payments known as tax credits. Even the government can take the tax payment to the Oxfam as a donations and later government pay them back to the people who are sick or to over 60 ages.
Government agencies - these are bodies that have been set up by the government to take responsibility for a particular activity. For example, the government is the Oxfam saver as well and the child protection agency is a government - funded body responsible for looking after the rights of children.
Charitable trusts - a charitable is one of the successful organisations anywhere in the world. They set up to raised funds and support other people or good cause. Charities have a register as such and must produce annual accounts that are available to be viewed. For example, the business is Oxfam etc. They are helping for homeless people, poverty, diseases etc.
Pass 2 D) Key Stakeholders
Customers: Each customer wants a company to produce highest quality, value for money goods. They will often identify with the brands that they buy. E.g. software purchasers want their software to be the best available within a particular bracket. They like to see improvements that give them better value for money.
( Microsoft want a customer to access to online by giving them discount price with promotional code and to increase their business profits or benefits and to take business to the advantage.
( Oxfam is thankful to customers for annual event and helped to boost this worthy environmental charity scheme because of providing natural shelter food resources.
Employees: They are at stake with their company to provide them with livelihood. They can take seek security of employment promotion opportunities, and nice rates of reward. They can also want to work for a company that they're proud of in business.
( Microsoft employees to function at optimal productivity levels, to deliver high quality service and responsive communications, and to obtain better results sales & services business.
( Oxfam employee by paid managers and workers (unlike voluntary organisations, which rely on the goodwill of their staff).
Suppliers: They want steady orders and prompt or quick payment. They will also want or deserve to feel valued by the company that they supply.
( Two of the language tool suppliers have Microsoft windows firmly in their sights for a renewed push into the application development market.
( Since 2002 Oxfam has been holding an annual supplier day. The purpose of this day is to give key suppliers a better understanding of Oxfam GB as an organisation, to improve Oxfam's awareness of how the organisation is perceived as a customer and to bring about general improvement in working relations between Oxfam and its suppliers.
Owners: It may individual owner in a sole trader business or the partners in a partnership. In a company it would be the shareholders. The owners are again regarded to be the vital stakeholders because they might put a nice part of their life into setting up a business. They see themselves as being the principal risk takers and also want to see the reputation of their business grow overtime.
( Microsoft owner Bill Gates and his career has hold the positions of CEO and chief software architect, and he remains the largest individual shareholder with more than 8% of the common stock.
( Oxfam has no owners and it's supervised by trustees and usually set up to provide a service to the wider community.
Pressure group: They are seeking to exert the pressure on business decision making. E.g. pressure groups are Greenpeace and friends of the Earth that see themselves as defending the environment. They will try to press environmental concerns on to the business.
( Microsoft faced the potential of being broken up by a decision taken by the former presidency and recent president expressed his belief that Microsoft owner represented success story.
( Including Greenpeace, Oxfam, friends of the Earth and WWF, have condemned the summit as failure and a missed opportunity.
Trade Unions: It will represent the interest of groups of employees. They seek to secure higher wages and better working conditions for their members.
( The Microsoft groups of employers or employees, which are seeking to secure highest wages with well conditions for their members to get new skills day-by-day.
( Oxfam employees, for example in shop and they seeking to secure minimum wages and good working conditions as a team to save people from the poverty.
Employer Association: There are employer's equivalents of the trade unions. These bodies represent the interests of groups of employers. For example there are employer's associations repressing the interests of employers in specific industries.
( Microsoft is an active member of several leading European public policy and industry Employers associations. They work closely with these organisations to develop initiatives and programmes that seek to advance the debate on industry and regulatory issues that affect the economy, as well as consumers, businesses and industries in the region.
( In the Oxfam, Employers associations are also required to give all volunteers the information, instruction, training and supervision necessary for their health and safety.
Local and national communities: They might generally concern or worries of business activity. E.g. a local social cost could be pollution from a local factory, when a national social cost might be carbon emissions fro air traffic.
( Microsoft actions of business can have a dramatic effect on communities. For example, the company have many wires somewhere, which relates to the computing systems. The fire will be very dangerous and cause to local communities.
( Oxfam use of harmful materials or high energy consuming processes in the production of the items it purchases, disposal of waste products, relationships with local communities where activities take place. Community leaders therefore represent important interest groups.
Government: They have their authority to either block, promote or regulate firm activity. They will also can influence or persuade profitability through taxation. E.g. Business rates, PAYE, VAT, NIC, corporation tax etc.
( Government can influence both Microsoft and Oxfam profitability through taxation. E.g. Business rates, PAYE, VAT, NIC and Corporation tax etc. So the government ...
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( Oxfam use of harmful materials or high energy consuming processes in the production of the items it purchases, disposal of waste products, relationships with local communities where activities take place. Community leaders therefore represent important interest groups.
Government: They have their authority to either block, promote or regulate firm activity. They will also can influence or persuade profitability through taxation. E.g. Business rates, PAYE, VAT, NIC, corporation tax etc.
( Government can influence both Microsoft and Oxfam profitability through taxation. E.g. Business rates, PAYE, VAT, NIC and Corporation tax etc. So the government wants the business to be successful and to create jobs and to pay taxes.
Links & Interdependencies: A firm needs to take account of the interests of all of its stakeholder's groupings. These interests are all linked together. The various interest groups are interdependent.
( Microsoft business to be successful, its stakeholders must work together, which they can make higher profits mean higher wages for the staff, higher tax revenue for government and increased dividends for the owners.
( Oxfam business conflict but sometimes will be staff lost and it can be seen profit decreased during disaster occur the business may need more staff and the time will more benefits or profits.
Pass 3 - Understanding how the type of business influences the setting of strategic aims and objectives.
Introduction
I am continuing work for my two main businesses, and it's all about how to understand the kind of businesses influences and the setting of strategic aims and objectives. They are involves:
> Strategic planning process
> Public and voluntary sector strategies
> Setting aims and objectives
> Planning strategies
I should introduce my two businesses in a few lines and explain the terms 'aims' and 'objectives' clearly and concisely.
An aim is a general statement of intent. It tries to summarise, in broad terms, the activity which is about to take place. Aims are written in general terms.
Example:
The aim of this section of the Microsoft website is to improve our understanding of the difference between an aim and an objective.
Once we have established our aims it is them important to break these down into small, achievable chunks. These are called objectives.
An objective is a description of an intended outcome, written in specific terms. It describes:
* What we/Microsoft/Oxfam will do?
* By when.
* Using what (resources, equipment, facilities).
* To what standard.
Public and voluntary sector business (Oxfam)
3 strategic Aims
* To save people from poverty and homeless
* To provide free emergencies services
* To send charities to help children get to school immediately
3 SMART objectives
* The providing of TV show about twice a week can be shown all about related to health, foods, education, floods etc, to develop by next year January 2008.
* It is important to alert emergencies during floods and earthquake, they must reach there to get people to survive or rescue them at anytime at future periods.
* To advertise on TV or ask people, who don't need computers, books and software? But needed to accumulate 1-100 computers for schools, and to inform whether they need it or not; will be predicting by January 2008.
Private sector business (Microsoft)
3 strategic Aims
* To help customers to reach their potential
* To consider the Microsoft softwares to worldwide technology and get skills from new Computer science programming
* To help people to get knowledge in latest digital education on computing.
3 SMART objectives
* It is necessary to attract more new customers on their business and inform them about computing, software and books and it must be predict by December 2007.
* To publish a thick book and then advertise it, but people who don't know about Microsoft and persuade people to buy them what Microsoft technology is.
* To qualify computer science courses for students who are interesting in leanings and reach them by online cheaper to teach.
A) Strategic planning process
Quantitative analysis of current situation: Quantitative analysis is based on numbers. It is to assist in the making an appropriate plan. For example, if Oxfam costs are lower than those of rivals that they can undercut their prices, or make more profits from the same volume of sales. If they are selling more than their rivals are, they could set themselves the aim of retaining market leadership. If their customers are pleased then they can focus on customer pleasing to beat competitors. For example, if interest rates are high they know that costs are likely to rise if they have borrowed money.
Qualitative analysis of current situations: Qualitative analysis is more about feelings or opinions and instincts. Qualitative analysis is more emotional. In Microsoft, qualitative analysis can be earned from asking questions and discussing issues with different groups. For example, they might interview small groups of customers to find out about what they think of the company or goods and services. How do customers view them compared with the competition? They can talk or discuss with employees and pressure groups to discover what they think of them.
Setting aims and objectives: The aims of the businesses depend on the kind of business they are. For example, the aims of Oxfam will be quite different from those of Microsoft. A firm needs to have a clear sense of direction that should be clearly communicated to all stakeholders. The aim of the firms which are then split into objectives. The objectives set out more specifically how the aim can be achieved. For example, the aim of the Microsoft is to be the world's leading software supplier. The objective is to undercut the price of rivals; to take over other similar makers; to increase sales by giving discount price to the customers.
Planning strategies: The quantitative notification about benefits or profits might suggest that the company must be wary about expanding at any time. The qualitative notification about growing customer preference for organic goods may suggest that they expand their organic lines. The firms need to make plans to take them forward into the future may be for five years or more. The plan must set out where the business wants to go, the aims and objectives, and details of how they will achieve these aims; it is referred to as the strategy. A well strategy must be:
Realistic, i.e. likely to put into practice given the resources of the business.
B) Public and voluntary sector strategies
Public sector service provision: The trust receives funds from the government and then is expected to control these funds efficiently to meet government targets. The targets relate to such things as managing waiting lists so that patients do not have to wait too long for treatment. Primary health care trusts are therefore designed to seek to give the maximum service given the resources available.
Voluntary sector services: In the voluntary sector much of the emphasis in the aims and strategies of businesses is on providing service. E.g. Oxfam Ambulance service and their voluntary organisation designed to provide medical support to the public at times of need. It can play particularly important role in training volunteers to give first aid. Oxfam raises money through a range of fundraising events and that money can then be used to provide training, and pay for the maintenance of ambulances and other services.
Service level agreements: To create a service level agreement it is necessary to establish certain standards that must be met. We have already seen this in the case of Oxfam or primary health care, relating to the length of patients waiting lists and the time taken for a patient to be treated.
Provision at or below cost: There are so many pressures on public sector and voluntary businesses to obtain products and services at a maximum cost. It is because of government, rather than a private owner, is the key stakeholder in the business. Because the government represent the community it is more concerned with making sure that there is a return to society. For example, health and social services provide home nursing to elderly and sick at below cost price, Oxfam operates health services during disaster periods by providing nurses or doctors and to help people with any types of illness. So the government will provide many services and goods at below cost to certain groups.
C) Private sector Strategies
Profit maximisation: The principle of adjusting price and/or output volume in such a way as to earn the largest possible profits in Microsoft. This is said to be accomplished by continuing to increase production up to the point where the cost of the last unit of output just equals the additional revenue received by the firm from selling that additional unit of output (Marginal Revenue). This is the profit maximizing output since profits would be reduced by producing still another unit (the extra cost would exceed the extra revenue.
Sales: There is another strategy that private sector firms can implement, which is to maximise sales. There are two various ways of calculating sales:
* Sales volume: the number of items sold.
* Sales value: the money received from making sales. It is also called sales revenue.
Products/services at cost/profit: The business aims to drive sales of Microsoft products by working with large enterprise customers to help them adopt and deploy Microsoft products, and with technology solution providers to make sure they can offer a wide range of Microsoft-products related services at cost.
In Microsoft, only two percent of the company's revenue comes from consulting and support services. Although it was generating a profit, it was also trading a very fine line with its channel partners, who were already offering many of the same services that corporate customers were asking Microsoft to provide.
Increasing revenue and cutting costs: To increase profit it is necessary to increase sales revenue and/or lower costs. There are the main strategies that firms will peruse in order to raise profit margins. There are another ways of rising sales revenue include:
* Improving Microsoft products.
* To spend more on advertising on their product.
There are many costs that may be cut. For example:
* In Microsoft two people works together that could be done by one person.
* Unnecessary costs - e.g. lighting and heating left on when it is not required for electronic software makers.
* Wasteful use of other resources.
Breakeven: The breakeven is therefore necessary business objective, and one that is essential to ensure survival at least in the short-term. The breakeven for Microsoft is the point where it exactly covers all of its costs with its revenues.
Survival: The business that has been there a long time survived. Survivor like Microsoft may have seen better days. At one time it would have been unthinkable that Microsoft would have to struggle to survive. Up until the 1994 Microsoft went from strength to strength and represented the very best of American/global quality. It was said that people could walk to any room where other people are gathered and know with certainty that the majority of students or business people would be using their software's on Mobile, PDAs, handheld laptops etc. However, by the 2001 many consumers enjoys and desire to become more powerful business in the world to survive and it is to be still in business next year.
Marketing: Marketing helps Microsoft to identify and qualify new prospects and communicate the right message to their customers-at the right time and through their preferred channel. Quickly plan and execute personalized campaigns across all communication channels, including direct sales, call centres, e-mail, fax, and the Internet. A single campaign window consolidates all the information and functionality they need. Microsoft helps to optimize their sales and marketing activities to control cost and increase effectiveness.
Competitors: Microsoft operates in competitive local, national, international and global markets. The business need to be alert to what their competitors are doing. They must make sure that they are seen as market leaders rather than market followers. First to market is necessary in business they talk about 'first mover advantage'. The organisation that comes up and delivers new ideas before rivals steals a march on them.
D) Growth
Profit: Net income is equal to the income that a firm has after subtracting costs and expenses from the total revenue. Microsoft net income is $14.06 billion (2007).
Sales: In business, revenue or revenues is income that a company receives from its normal business activities, usually from the sale of goods and services to customers. Microsoft revenue is $51.12 billion (2007).
Market share: The business of Microsoft's search engines saw their first market share increase in nearly a year. Microsoft's search market share jumped 0.4 percentage points from February to March, giving it 10.9 percent of the total market.
Conclusion
They have to reduce the number of Homeless families in bed breakfast for longer than 6 weeks to zero in line with the November 2007. Government target and proactively prevent homelessness through help and advice to residents. However there are currently households and Oxfam must reduce this by at least by 2008.
Pass 4 Assignment 4 - Describe the functional activities and their interdependencies within the two organisations.
Introduction
I need to continue my work for those two businesses, and explain understand functional activities and organisational structures.
Section 1
Organisational Structures - Both Microsoft and Oxfam need to create a structure that will enable them to better meet the needs of their stakeholders. E.g. an important part of the structure of a private Company is the Board of Directors with the MD at the top. By giving high priority to the Board means that the interests of the owners (stakeholders) are given priority.
Therefore the customers are very important organisational structure needs to ensure there are clear links to customers. E.g. the organisations can give priority to the position of customer service managers.
Functional Activities - The section describes the key functions of a modern business. The businesses are commonly organised in departments carrying out these key functions. E.g. the functions are human resources, finance and research and development etc.
Section 2
Function's name
Description
Definition
Microsoft
Oxfam
Finance
They are keeping records of financial activity and to provide managers with information and helping to create financial plans.
Co - ordinates the revenues and expenses across all the other functional areas of the business so that it will have sufficient funds to survive and generate profits to reward its reward.
Yes
Yes
Human resources management
Helping other functional managers to develop their work, such as helping them to recruit new staff.
HRM will be responsible for all ideas of people management in a firm. The kind of work covered in the human resources function might include the following.
Yes
Yes
Research and development
R&D department enables new products and processes and then seeks to develop them into finished article.
They investigate new goods and process and then seek to develop them into the finished article. E.g. softwares manufacturers are researching environmentally friendly softwares that run on computers programme, electricity.
Yes
Yes
Production
Production manager of a Microsoft is responsible for making sure raw materials are processed into finished goods well.
The organising the manufacture of the goods range to consistently high quality standards.
Yes
No
Service delivery
Both businesses therefore have a functional department called customer service. A number of functions, such as :
* Dealing with customers
* Handling customers complaints
* Making sure customers are obtaining better service
* Staff to work with customers, face to face or by email or phone.
Consumers are the most important people for an organisation. The firms are therefore developing relationships with customers through the quality of customer service that they provide.
Yes
Yes
Marketing
This includes carrying out market research to find out which types of customer make up a particular market, what they want, where want it, how they like it, and at what price.
There are researching around the world market to discover who buys the goods, why and what they are searching or looking in the future, marketing and design work together to agree new goods.
Yes
Yes
Procurement
In procurement it is necessary to develop lists of suppliers on a database.
Procurement is vital. It is concerned with getting important resources such as raw materials and office supplies to keep the business running smoothly. It also important to keep records of how reliable and how competitive is the prices charged by any suppliers.
Yes
Yes
Information technology services
IT services are:
* Supporting other company functions.
* Providing specialist IT support
* Managing computer functions
The IT director is there to develop IT in the company and provide the guidance, support and expertise necessary to accomplish this.
Yes
Yes
Sales
Sales executives are responsible for increasing and developing sales in areas including:
* fast moving consumer goods
* IT, software and media
* Services (such as print and financial services).
There will be organising the local promotions and sales of goods. For example, some company employ are large sales force on a regional basis, e.g. firms selling sofwares and clothes.
Yes
No, But will have a fundraising department
Customer service call centres
Customers call centre consists mostly of:
* Call centre employees
* Telephone networks
* Computer databases and other data sources.
Any call centre is individual unit within a company which designed to receive and make telephone calls to customers.
Yes
Yes
Management information systems
They manage information system is large, usually computerised, databank to which managers have access. There will be a number of files that are regularly updated.
Controlling the flow of information through the organisation, to use computer communications technology. Information is a very important ingredient in correct decision - making so its storage, retrieval and communication have to be merged carefully.
Yes
Yes
Logistics
A logistics manager is responsible for managing processes involved in a supply chain and liaises with a variety of parties, including suppliers of raw materials, manufacturers, retailers and, increasingly, consumers.
It is includes organising the delivery of products by a firm and various materials and goods around an organisation or business. The key elements of logistics are transport and postal services.
Yes
Yes
How range of functional activities are managed in small and micro businesses
Just a business doesn't mean that it shouldn't have specialists. It is not possible for one or two people to handle all of the necessary functions listed above. The specialists may need to be hired to manage important activities, such as marketing or IT. Some small businesses also contract out some of their functions. E.g. they might pay an accountant to produce the annual accounts - paying them for just a few days work.
Section 3
Organisational structures: The structure of the two organisations is best exposed by probing the organisational chart. The chart shows the main parts of the business, and the relationship between the various parts. Note that necessary parts of the structure are the production department and the sales department selling direct to other business.
Purposes: If we look at an organisational chart it should give us a clear picture of what the relevant sections of the business are and who reports to whom. When Microsoft refers to line management and is talking about a person who is directly responsible for somebody else. E.g. the production manager reports to the general managers.
Division of work: The structure of the two businesses can show clearly how work will be divided up in an organisation. For example:
* Who is responsible in Oxfam for dealing with customer complaints
* Who is responsible in both companies for dealing with the payment of wages
* Who should be responsible in Microsoft for making sure that the IT systems in an organisation are working smoothly
There are integers of ways of structuring an organisation:
Functional: Functional structure is probably the most common way of grouping employees. Functional organisation means that the business is divided into specialism, such as sales and production.
Geographic: Oxfam is a national, international or global business. For example, the company may have a Europe, North American and Asian division. These divisions will report to Head Office.
* By customers: The Oxfam company are divided into areas that deal with different kinds of customers. E.g. there may be department that deals specifically with regular customers and another with the general public.
* By process or equipment: In Microsoft work area may be divided up into various kinds of softwares machinery and activity. E.g. in a Microsoft company one department can be responsible for softwares recordings or burnings.
Span of control: Span of control is the term for the number of Oxfam subordinates directly accountable to a manager. The larger the number of employers a production manager controls the wider his span of control in Microsoft. Wide span: The production manager controls more than six employers. Managers are forced to delegate work, and tasks may be less closely supervised. There are possible problems with the overloading of work and with loss of control. However, there are fewer levels of management.
I created an organisation chart for both businesses and it's following below:
Section 4
Flow of work: Controlling the flow of work between the functions of a company is necessary. For example, in Microsoft an advertising campaign for new product, specialist input may need to come from various sources. Production may need to explain how the goods works and what key features have been built into it.
Interdependencies: This is often achieved by arranging employees into cross functional teams in Oxfam. It is approach broadly used in managing projects. E.g. when doing research and bringing out a new product it makes sense to have a team consisting of:
* Financial specialists who is carrying out costing and set out the financial implications of a particular project.
* The quality specialists who emphasis quality related issues.
Outsourcing of functions: These organisations have two main kinds of activities. Examples of activities that businesses outsource today include call centres, administration, delivery and production.
* Call centres: Microsoft outsource call centre work to private call centres. The business would establish the routines and patterns of work that it wants the call centre to do for it and will establish minimum standards for the call centre to meet. The centres have many duties handling the work on behalf of the company and also handling consumer complaints to selling products.
* Administration: The administration is also outsourced. E.g. Microsoft might outsource work including the photocopying of materials, the word processing of documents, the maintenance of databases, etc and can also outsource work including the setting up and maintaining of websites.
* Delivery: The business can outsource work which includes the delivery of company goods, or packaging and storing products. It is rather than a business having the problems and duties of owing Lorries or vans itself but it can cut its costs by outsourcing. Which are cut involve the costs of obtaining, insuring and maintaining vehicles.
* Production: The Microsoft outsources the production of their products. Then they can concentrate on core activities such as selling, advertising and marketing goods. For example, the Microsoft sold their softwares on PC world or other software stores and is typically produced by firms who are contracted to work either for own or other retailers.
Influencing factors
Size: Microsoft is the largest organisation, its structure tends to become more formal, in order to coordinate larger numbers of workers, departments and diversity of goods and services.
Business environment: The company environment is a main fact of organisational structure. The company environment consists of all those factors which lie outside the company.
* Static and dynamic environments: for example, in Microsoft the sales can have peaked and remain steady over a period of time. The organisation can therefore feel little need to restructure. In Oxfam, dynamic environments the pace of change may be rapid. The structures are required that can enable rapid change. The flexible teamwork structures are more beneficial in dynamic environment. The team members may be encouraged to come up with ideas for themselves rather than being told what to do.
Strategic plans: The kind of business structure also depends on business plans. E.g. Microsoft that seeks to become more market oriented will develop structures that place an emphasis on marketing and customer focus. Both Microsoft and Oxfam seek to develop globally will develop structures that allow geographical specialisation. If strategy related to increasing sales then the number of sales people is likely to increase in Microsoft.
Conclusion: At Microsoft, they're working toward a future where everyone's potential can be fulfilled. What about ours? They offer opportunities around the world to make an impact with the next generation of technology they're building today. They invite us to explore, dream big and learn more about what they can offer us.
Pass 5
Assignment 5: Know how external factors in the business environment impact on organisations.
Introduction
Still I need to carry on with these two businesses. And know how external factors in the business environment impact on organisations.
Section 1
I will see therefore that the businesses environment consists of all those things outside the businesses. The businesses need to keep a watchful eye on the environment because it is continually changing, to assist in this process they might use PEST analysis.
Political factors: Have a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. Political factors: include legal aspects (e.g. Microsoft copyright), the general political ethos.
Economic factors: Marketers need to consider the state of a trading economy in the short and long-terms. This is especially true when planning for international marketing. to look at: Economic factors include the effect of the economy (e.g. Interest rates) on individuals, and on organisations.
Social factors: The social and cultural influences on business vary from country to country. It is very important that such factors are considered. Factors include demographic change (e.g. Oxfam is concerned of changes in proportion of age groups and educational changes.), other changes in social habits (where people go to shop, leisure expectations),
Technological factors: Technology is vital for competitive advantage, and is a major driver of globalization. Consider the following points: There are obviously a wide range of technological factors affecting libraries and information centres (e.g. Microsoft Internet, telecommunications, and the media in which people expect to find information).
Section 2
National and international laws: International laws are created by international bodies; in particular Britain can be affected by European Union laws. The European Union courts are increasingly important in making judgements which apply across the Union. European Union laws are regarded as having supremacy over national laws.
* Employment: Over time a body of law or legislation has developed governing employer/employee relations and the rights of employees and employers in the workplace.
The Working Time Directive, 1999
Both businesses must guarantee to all employees a maximum 48 hours working week, and a four week holiday. Employees can choose to opt out of the Working Time requirement and agree to work longer hours if they wish.
* Contracts: Oxfam employees have rights under their contract of employment. An employment contract is a legal agreement between an employer and an employee, setting out the terms on which one agrees to employ the other. An employment contract will deal with many issues, including the employee's job description and duties, hours of work, pay, holiday and sick leave. For example, the national minimum wage is necessary part of UK government and EU policy to provide employees with decent minimum standards and fairness in the workplace.
* Consumer rights: Microsoft business makes sure that their goods and services meet general safety requirements. They must make sure that everyone on their premises is safe. In addition, they must ensure that what they offer the customer is accurately described and that the claims they make about their products are true. Consumer legislation provides real challenges for business: The consumer legislation helps to further inform consumers about their rights. This leads to every-increasing pressures on business to operate in a safe and reliable way. E.g. compliance costs money. Making sure that they keep within the EU law is a costly business to operate in a safe and reliable way.
* Environmental issues: The environment has become a major issue. These businesses need to show that they are aware of any issues if they are to keep various stakeholder groups happy, including:
* Employees: who may not to work for a company with a poor environmental record
* Customers: who may want to buy some products that need them
* Pressure groups: Like friends of the Earth and Greenpeace.
For example, the government has introduced a range of regulations that affect on both businesses. These involve the following:
* To stop pollution and control is a legal set of rules for controlling pollution resulting from some industrial activities. These businesses are required to use Best Available Techniques to manage pollution.
Other environmental regulations relate to how asbestos (a fibrous mineral used in fire-resistant and insulting materials) is disposed of, and restorations on how hazardous substances are stored.
* Fraud: There is an increased amount of fraud which takes place as a result of cybercriminals hacking into Microsoft company databases, the majority of fraud takes place within companies, and much of this fraud may take place with the collusion of senior managers and members of Boards of directors. Examples of company fraud include:
* Stealing company assets
* Stealing cash and equipment
* Forging signatures on company cheques
* Employees and suppliers altering invoices, e.g. adding goods bought for private consumption to a company invoice.
Government: Government actions have a direct impact on both businesses. Each week the government can create new regulations about health and safety at work, employment rights, consumer protection, fraud, e-commerce and many other areas of business life. Another most important area of government activity comes in the form of taxes and subsidies. The government uses taxes for various purposes such as:
* To raise revenue for government spending
* To discourage certain activities such as the creation of pollution.
Taxation can directly affect Microsoft. When the government raises taxes this immediately raises costs to business. For example if the government increased VAT by 2% then business would have to buy raw materials, machinery and equipment which is 2% more expensive.
The tax includes taking money away from a business or individual. For example, income tax is paid at a given rate on income earned above a certain level. Both businesses employers are expected to pay other tax based costs such as National Insurance contributions. The contribution that the employer makes covering provision for the state pension, sickness, unemployment and any other benefits for individual workers.
Other examples of government subsidies to farmer through European Union farm support. Farming is thought to be very important because it provides us with our food supplies and also help Oxfam to reach food to poor communities in other countries.
Section 3
Pay levels: Microsoft salaries have been stagnant or nudged only slightly higher over the past two years. Comments from current and former employees about the company's compensation and performance review system suggest a growing level of frustration among rank-and-file workers. The documents appear to show minimum, midpoint and maximum compensation guidelines at Microsoft going unchanged between 2004 and 2006 for eight of the 21 salary categories, at the lowest end of the pay scale. In other categories, many of the increases shown are below 3 percent.
Cost of credit: Some business activity is funded by credit. E.g. Microsoft business often purchases machinery and equipment through some form of borrowing arrangement. Business buys supplies and raw materials on credit terms. Both businesses must be careful not to borrow more than they can afford because interest repayments can rise, causing a drain on the business.
Competitive pressures: In Microsoft the competition is one of the biggest influences on business. Business competes through:
* Differentiating their product
* Price: higher or lower than rivals
There are various ways to beat the competition. One of the current trends in competitive strategy is to be the greenest in the business.
Globalisation: The creation of Microsoft global goods and global marketing. The same products and marketing and advertising campaigns can be used worldwide. This significantly lowers costs. For example, Christmas advert for Microsoft can be shown on television in hundreds of countries. The creation of global brands and people around the world instantly recognise global brands like Microsoft Window Vista and Office 2007.
Labour/supply and demand: There is more and more emphasis on intellectual intelligence and new knowledge workers, such as working in Microsoft IT, can receive high salaries. It can be argued that emotional intelligence is in short supply. Emotional intelligence includes the ability to get on with customers directly, for example service and telesales workers.
Labour and their wages are likely to rise. In difference of there are more people looking for jobs than there are jobs available then wages will fall. The number of workers in the UK earning above average salaries has been increasing. E.g. half a million people earn at least £100,000 before tax - about 400,000 of these are men.
Energy prices: The energy costs are important costs for Microsoft. It is particularly true of manufacturing companies where power is needed to run machinery and computers. However, it is also necessary for service industries, like insurance, which rely on computer networks and in which heating and lighting costs for the offices in which employees work can be a considerable cost.
Huge increases in energy prices. There have been considerable increases in energy prices in this country. The effects on these businesses are shown in the following.
* 70-80% average gas price increases for the chemical industry between 2004 and 2006.
* 40-50% average gas and electricity price increases in the retail sector over the same period.
* £41-£45 million increase NHS gas bill between November 2003 and 2004.
* £100 million combined increase in local government gas and electricity bills in 2004.
Section 4
Ageing population: A major impact on business might be increased labour shortages. Oxfam business in particular may be forced to raise wages to attract labour. As the percentage of the elderly rises in the population the government may be forced to increase taxes and National Insurance contributions to support the elderly populations.
According to the recent estimates, the number of people over 60 could rise by 40% in the next 30 or 35 years. In 1995 there was less than 9 million people over 65 by 2030 there may be about 13 million.
Hosting of major sporting or cultural events: Business may capture public attention and thus enhance its position in society is through hosting important cultural and sporting events. It is why Microsoft seeks to sponsor and to create a game of Football for Xbox, so according to this thinking, Football is the World's greatest game and Microsoft is the World's greatest software manufacturer. E.g. Companies contest with each other to gain exclusive rights to sponsor events such as the London Promenade Concerts or the British Grand Prix.
Celebrity culture: Microsoft is advertising "Celebrity home pages for live.com". For example, If David Beckham gets a contract of Window live space from Microsoft such as below Window screen table Shown:
The approach is highly consistent with Microsoft longstanding strategy. This footballer can get a share by promoting his space on window live.com. Microsoft refreshing take on online services is existing relationships and will get profit increase by the end of the year. To get Microsoft window live spaces, his requirements to pay for a year. "DB (David Beckham) at the centre of Window screen" stuff comes through the celebrity pages, because their focus is so much about marketing. Where Microsoft blurs live and MSN, as celebrity favourites, such as clothes, music, and Football games, will lead to MSN ad these products will be for sale.
Section 5
Broadband and telephony developments: To access the Internet individuals need to have an ISP (Internet service Provider). Large numbers of customers prefer to use broadband services which give much quicker and more reliable access to the Internet dial-up services.
Broadband has also carried high-speed Internet to large business like Microsoft; it enables them to transfer large amounts of data very quickly. This has provided many cost benefits to business, as well as opening up many more business opportunities, in terms of what can be delivered via the Internet and what customers expect from the Internet.
New organisations: Gaps in the market provide an opportunity for new organisations to set up. For example, because of environmental legislation a variety of new organisations have been created which clear up pollution and process waste for other businesses.
Teenagers have a particularly important role in the success of new goods. Many teenagers are knowledgeable about new technologies. They can be easily convinced by the advertising hype that is associated with new goods. But it will be interested in word of mouth and what teenagers say about products. For example, this has led to the success of new products such as Microsoft future gaming softwares.
Winding up of existing organisations: Environmental factors can lead to businesses running into difficulty. In the legal and social environment has led to a number of, for example nightclubs and Disco clubs winding up. This is where a business has to close down and often has its assets sold off to pay its debts.
Take-overs and mergers: If Oxfam wishes to take over another business it will set out to purchase more than 50% of the shares. As soon as the investing business has a 50% share plus one share it is in control. It can make all the decisions as it cannot be outvoted by the other shareholders.
A merger happens while both businesses join to form a single company. A merger is very similar to take over except the existing shareholders of both businesses retain a share interest in the business. For example, there is too much supply in the market relative to demand, a firm may take over part of arrival in order to reduce supply to the markets, perhaps in other countries.
Revision of strategic plans: These businesses repeatedly change its plans. It is important to repeatedly keep in tune with what is happening in their company environment and to alter their plans to keep in touch with what is happening in the wider environment.
Impact on stakeholders: The stakeholders are affected by external changes, and so what they expect of their Oxfam has changed. They might see this, E.g., in growing environmental awareness and health awareness.
* The government is more of its responsibility for the environment and the health of the nation and therefore exerts pressure on business through regulation.
* The employees are likely to work for Oxfam with excellent environmental and health records.
Functional activity changes: In the recent these two businesses functions have become particularly important:
* Marketing: To discover what customers want.
* Customer service: Because of the recognition of the necessary of customers
* Information and communications technology: Microsoft because of the growth of the Internet, broadband and associated technologies.
* Call centres: as a means of outsourcing work.
* Human resources: In both companies people who work for them need to feel that they are valued if they are to be motivated. Human resource management has thus grown in importance.
Merit 1
* Explain the points of view from different stakeholders groups seeking to influence each organisations aims and objectives.
Aims: An aim is where the business wants to go in the future, its goals. It is a statement of purpose, e.g. Microsoft& Oxfam want to grow the business into the Worldwide.
They are very long-term goals which a business hopes to achieve. The core of a business's activity is expressed in its corporate aims and plans. The term is rather misleading because it is not just companies which have these goals. For example, sole traders and partnerships will also, commonly, develop the same kind of long-term vision for their business.
Objectives: Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. This can motivate the employees. It also enables the business to measure the progress towards to its stated aims.
Clearly, the objectives of the business will influence strategies. Increasing shareholder wealth in the short term might not be the best by investing in extensive research and development with a payback many years into the future. Increasing market share as an objective might not be achieved if the efforts of the business being directed towards entering completely new markets with new products.
Stakeholders and their aims & objectives
There are many stakeholders in Microsoft and Oxfam businesses. Ideally all stakeholders will have common views on what corporate aims should be. This is, reality, most unlikely. The reason for groups having a stake in any these two businesses are so fundamentally different that there will be many occasions when their interests diverge and even conflict. A business has to find a way of satisfying these different interests especially those influenced stakeholders but there is no sure or safe route through this dilemma.
On table shows of the two businesses stakeholders with a setting of strategic aims and objectives.
Stakeholders
Aims
Main objectives
Directors
Make business more successful
To direct strategy and major decision making of the business
To retain control
To increase their own power and status from business growth
Employers/Employees
Receive wages with bonus for working extra hours
To receive a fair wage
To ensure good working conditions
To secure their jobs through the survivals and expansion of the business
Customers
Access more customers on their online store
To obtain good value for money from the goods and services purchased
To receive high levels of customers service
To receive after-sales service and supply of spares from a business which survives in to the future
Suppliers
Sell goods well on highest standards rates
To continue to sell profitably to the business
To be paid promptly and full for goods supplied
Banks/Lenders
Get more interest by paying immediately
To be paid back in full when repayments are due
To receive interest on the loan when due
Community
Avoid environmental concerns onto the business
To benefit from the employment the business creates
To be free from environmental disadvantages the firm might generate
Government
Take a full responsibility in looking after the welfare of society.
To receive tax revenue from profitable firms
To direct the operations of the business for the benefit of the community/nation
To assist the business in accordance with local and national policy
Competitors
Defeat rival businesses
To compete by all lawful means
To differentiate its products from those of other business
To compare and contrast performance with other businesses
Stakeholders
Aims
Main objectives
Customers
Make them more aware by adverts
To make leaflets, i.e. for donations or contributions and to access each leaflets to number of houses where the customers lives
To make them hand the donations by December 2007
Employees
Save people from poverty and homeless
To train staff or employee and get them for health and education, to proceed it from early 2007.
Suppliers
Sells foods and waters with fresh and ice-covered
To protect people to supply them naturally foods
To be paid quickly and full for goods supplied
Pressure groups
To getaway environmental concerns
To see their business as defending the environment
To avoid pollution where people have disease
Employers associations
Raise awareness
To achieve business by assisting in near future by getting more doctors
To alert emergency during floods
To secure their jobs through to survive and rescue the people from poverty
Local and national communities
Avoid from waste materials
To burn waste products immediately by the time at this month
To send a leaflet to each house to protect their children from waste materials
Governments
To prevent illegal work
To develop by all lawful means
To control business operation and performance to ensure it remains within national and global laws.
Conclusion
As much as a business might try, it cannot completely satisfy all of its stakeholders all of the time. Every time a company attempts to satisfy the objectives of other interest groups it is likely, in the short term at least, to reduce rewards to shareholders. On the positive side, however, there are instances where:
Concerns for the needs of workers may increase their productivity.
Concerns for the community will increase customer loyalty and bring in new customers.
Ethical and environmentally friendly behaviour attracts customers and reduces the risk of legal action.
A good reputation for customer care and ethical standards
Merit 2
* Explain the points of view from different stakeholders groups seeking to influence each organisations aims and objectives.
Aims: An aim is where the business wants to go in the future, its goals. It is a statement of purpose, e.g. Microsoft& Oxfam want to grow the business into the Worldwide.
They are very long-term goals which a business hopes to achieve. The core of a business's activity is expressed in its corporate aims and plans. The term is rather misleading because it is not just companies which have these goals. For example, sole traders and partnerships will also, commonly, develop the same kind of long-term vision for their business.
Objectives: Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. This can motivate the employees. It also enables the business to measure the progress towards to its stated aims.
Clearly, the objectives of the business will influence strategies. Increasing shareholder wealth in the short term might not be the best by investing in extensive research and development with a payback many years into the future. Increasing market share as an objective might not be achieved if the efforts of the business being directed towards entering completely new markets with new products.
Stakeholders and their aims & objectives
There are many stakeholders in Microsoft and Oxfam businesses. Ideally all stakeholders will have common views on what corporate aims should be. This is, reality, most unlikely. The reason for groups having a stake in any these two businesses are so fundamentally different that there will be many occasions when their interests diverge and even conflict. A business has to find a way of satisfying these different interests especially those influenced stakeholders but there is no sure or safe route through this dilemma.
On table shows of the two businesses stakeholders with a setting of strategic aims and objectives.
Stakeholders
Aims
Main objectives
Directors
Make business more successful
To direct strategy and major decision making of the business
To retain control
To increase their own power and status from business growth
Employers/Employees
Receive wages with bonus for working extra hours
To receive a fair wage
To ensure good working conditions
To secure their jobs through the survivals and expansion of the business
Customers
Access more customers on their online store
To obtain good value for money from the goods and services purchased
To receive high levels of customers service
To receive after-sales service and supply of spares from a business which survives in to the future
Suppliers
Sell goods well on highest standards rates
To continue to sell profitably to the business
To be paid promptly and full for goods supplied
Banks/Lenders
Get more interest by paying immediately
To be paid back in full when repayments are due
To receive interest on the loan when due
Community
Avoid environmental concerns onto the business
To benefit from the employment the business creates
To be free from environmental disadvantages the firm might generate
Government
Take a full responsibility in looking after the welfare of society.
To receive tax revenue from profitable firms
To direct the operations of the business for the benefit of the community/nation
To assist the business in accordance with local and national policy
Competitors
Defeat rival businesses
To compete by all lawful means
To differentiate its products from those of other business
To compare and contrast performance with other businesses
Stakeholders
Aims
Main objectives
Customers
Make them more aware by adverts
To make leaflets, i.e. for donations or contributions and to access each leaflets to number of houses where the customers lives
To make them hand the donations by December 2007
Employees
Save people from poverty and homeless
To train staff or employee and get them for health and education, to proceed it from early 2007.
Suppliers
Sells foods and waters with fresh and ice-covered
To protect people to supply them naturally foods
To be paid quickly and full for goods supplied
Pressure groups
To getaway environmental concerns
To see their business as defending the environment
To avoid pollution where people have disease
Employers associations
Raise awareness
To achieve business by assisting in near future by getting more doctors
To alert emergency during floods
To secure their jobs through to survive and rescue the people from poverty
Local and national communities
Avoid from waste materials
To burn waste products immediately by the time at this month
To send a leaflet to each house to protect their children from waste materials
Governments
To prevent illegal work
To develop by all lawful means
To control business operation and performance to ensure it remains within national and global laws.
Conclusion
As much as a business might try, it cannot completely satisfy all of its stakeholders all of the time. Every time a company attempts to satisfy the objectives of other interest groups it is likely, in the short term at least, to reduce rewards to shareholders. On the positive side, however, there are instances where:
Concerns for the needs of workers may increase their productivity.
Concerns for the community will increase customer loyalty and bring in new customers.
Ethical and environmentally friendly behaviour attracts customers and reduces the risk of legal action.
A good reputation for customer care and ethical standards
Merit 3
Assignment 5 Plan - Know how external factors in the business environment impact on organisation.
Introduction
In P5 assignment, I explained about Know how external factors in the business environment impact on organisations. In here, I will analyse the impact of one change to the business environment that has impacted on two businesses. I need backed up by evidence from my chosen businesses.
Section 1
The Structures of the two businesses - Both Microsoft and Oxfam need to create a structure that will enable them to better meet the needs of their stakeholders. E.g. an important part of the structure of a private Company is the Board of Directors with the MD at the top. By giving high priority to the Board means that the interests of the owners (stakeholders) are given priority.
Therefore the customers are very important organisational structure needs to ensure there are clear links to customers. E.g. the organisations can give priority to the position of customer service managers.
Organisational structures: The structure of the two organisations is best exposed by probing the organisational chart. The chart shows the main parts of the business, and the relationship between the various parts. Note that necessary parts of the structure are the production department and the sales department selling direct to other business.
Functional Activities - The section describes the key functions of a modern business. The businesses are commonly organised in departments carrying out these key functions. E.g. the functions are human resources, finance and research and development etc.
Function's name
Description
Definition
Microsoft
Oxfam
Finance
They are keeping records of financial activity and to provide managers with information and helping to create financial plans.
Co- ordinates the revenues and expenses across all the other functional areas of the business so that it will have sufficient funds to survive and generate profits to reward its reward.
Yes
Yes
Human resources management
Helping other functional managers to develop their work, such as helping them to recruit new staff.
HRM will be responsible for all ideas of people management in a firm. The kind of work covered in the human resources function might include the following.
Yes
Yes
Research and development
R&D department enables new products and processes and then seeks to develop them into finished article.
They investigate new goods and process and then seek to develop them into the finished article. E.g. software manufacturers are researching environmentally friendly software that run on computers programme, electricity.
Yes
Yes
Production
Production manager of a Microsoft is responsible for making sure raw materials are processed into finished goods well.
The organising the manufacture of the goods range to consistently high quality standards.
Yes
No
Service delivery
Both businesses therefore have a functional department called customer service. A number of functions, such as :
* Dealing with customers
* Handling customers complaints
* Making sure customers are obtaining better service
* Staff to work with customers, face to face or by email or phone.
Consumers are the most important people for an organisation. The firms are therefore developing relationships with customers through the quality of customer service that they provide.
Yes
Yes
Marketing
This includes carrying out market research to find out which types of customer make up a particular market, what they want, where want it, how they like it, and at what price.
There are researching around the world market to discover who buys the goods, why and what they are searching or looking in the future, marketing and design work together to agree new goods.
Yes
Yes
Procurement
In procurement it is necessary to develop lists of suppliers on a database.
Procurement is vital. It is concerned with getting important resources such as raw materials and office supplies to keep the business running smoothly. It also important to keep records of how reliable and how competitive is the prices charged by any suppliers.
Yes
Yes
Information technology services
IT services are:
* Supporting other company functions.
* Providing specialist IT support
* Managing computer functions
The IT director is there to develop IT in the company and provide the guidance, support and expertise necessary to accomplish this.
Yes
Yes
Sales
Sales executives are responsible for increasing and developing sales in areas including:
* fast moving consumer goods
* IT, software and media
* Services (such as print and financial services).
There will be organising the local promotions and sales of goods. For example, some company employ are large sales force on a regional basis, e.g. firms selling software and clothes.
Yes
No, But will have a fundraising department
Customer service call centres
Customers call centre consists mostly of:
* Call centre employees
* Telephone networks
* Computer databases and other data sources.
Any call centre is individual unit within a company which designed to receive and make telephone calls to customers.
Yes
Yes
Management information systems
They manage information system is large, usually computerised, databank to which managers have access. There will be a number of files that are regularly updated.
Controlling the flow of information through the organisation, to use computer communications technology. Information is a very important ingredient in correct decision - making so its storage, retrieval and communication have to be merged carefully.
Yes
Yes
Logistics
A logistics manager is responsible for managing processes involved in a supply chain and liaises with a variety of parties, including suppliers of raw materials, manufacturers, retailers and, increasingly, consumers.
It is includes organising the delivery of products by a firm and various materials and goods around an organisation or business. The key elements of logistics are transport and postal services.
Yes
Yes
How range of functional activities are managed in small and micro businesses
Just a business doesn't mean that it shouldn't have specialists. It is not possible for one or two people to handle all of the necessary functions listed above. The specialists may need to be hired to manage important activities, such as marketing or IT. Some small businesses also contract out some of their functions. E.g. they might pay an accountant to produce the annual accounts - paying them for just a few days work.
Section 2
Public and voluntary sector business (Oxfam)
3 strategic Aims
* To save people from poverty and homeless
* To provide free emergencies services
* To send charities to help children get to school immediately
3 SMART objectives
* The providing of TV show about twice a week can be shown all about related to health, foods, education, floods etc, to develop by next year January 2008.
* It is important to alert emergencies during floods and earthquake, they must reach there to get people to survive or rescue them at anytime at future periods.
* To advertise on TV or ask people, who don't need computers, books and software? But needed to accumulate 1-100 computers for schools, and to inform whether they need it or not; will be predicting by January 2008.
Private sector business (Microsoft)
3 strategic Aims
* To help customers to reach their potential
* To consider the Microsoft softwares to worldwide technology and get skills from new Computer science programming
* To help people to get knowledge in latest digital education on computing.
3 SMART objectives
* It is necessary to attract more new customers on their business and inform them about computing, software and books and it must be predict by December 2007.
* To publish a thick book and then advertise it, but people who don't know about Microsoft and persuade people to buy them what Microsoft technology is.
* To qualify computer science courses for students who are interesting in leanings and reach them by online cheaper to teach.
Section 3
The stakeholders are:
Customers: Each customer wants a company to produce highest quality, value for money goods. They will often identify with the brands that they buy. E.g. software purchasers want their software to be the best available within a particular bracket. They like to see improvements that give them better value for money.
* Microsoft want a customer to access to online by giving them discount price with promotional code and to increase their business profits or benefits and to take business to the advantage.
* Oxfam is thankful to customers for annual event and helped to boost this worthy environmental charity scheme because of providing natural shelter food resources.
Employees: They are at stake with their company to provide them with livelihood. They can take seek security of employment promotion opportunities, and nice rates of reward. They can also want to work for a company that they're proud of in business.
* Microsoft employees to function at optimal productivity levels, to deliver high quality service and responsive communications, and to obtain better results sales & services business.
* Oxfam employee by paid managers and workers (unlike voluntary organisations, which rely on the goodwill of their staff).
Suppliers: They want steady orders and prompt or quick payment. They will also want or deserve to feel valued by the company that they supply.
* Two of the language tool suppliers have Microsoft windows firmly in their sights for a renewed push into the application development market.
* Since 2002 Oxfam has been holding an annual supplier day. The purpose of this day is to give key suppliers a better understanding of Oxfam GB as an organisation, to improve Oxfam's awareness of how the organisation is perceived as a customer and to bring about general improvement in working relations between Oxfam and its suppliers.
Owners: It may individual owner in a sole trader business or the partners in a partnership. In a company it would be the shareholders. The owners are again regarded to be the vital stakeholders because they might put a nice part of their life into setting up a business. They see themselves as being the principal risk takers and also want to see the reputation of their business grow overtime.
* Microsoft owner Bill Gates and his career has hold the positions of CEO and chief software architect, and he remains the largest individual shareholder with more than 8% of the common stock.
* Oxfam has no owners and it's supervised by trustees and usually set up to provide a service to the wider community.
Pressure group: They are seeking to exert the pressure on business decision making. E.g. pressure groups are Greenpeace and friends of the Earth that see themselves as defending the environment. They will try to press environmental concerns on to the business.
* Microsoft faced the potential of being broken up by a decision taken by the former presidency and recent president expressed his belief that Microsoft owner represented success story.
* Including Greenpeace, Oxfam, friends of the Earth and WWF, have condemned the summit as failure and a missed opportunity.
Trade Unions: It will represent the interest of groups of employees. They seek to secure higher wages and better working conditions for their members.
* The Microsoft groups of employers or employees, which are seeking to secure highest wages with well conditions for their members to get new skills day-by-day.
* Oxfam employees, for example in shop and they seeking to secure minimum wages and good working conditions as a team to save people from the poverty.
Employer Association: There are employer's equivalents of the trade unions. These bodies represent the interests of groups of employers. For example there are employer's associations repressing the interests of employers in specific industries.
* Microsoft is an active member of several leading European public policy and industry Employers associations. They work closely with these organisations to develop initiatives and programmes that seek to advance the debate on industry and regulatory issues that affect the economy, as well as consumers, businesses and industries in the region.
* In the Oxfam, Employers associations are also required to give all volunteers the information, instruction, training and supervision necessary for their health and safety.
Local and national communities: They might generally concern or worries of business activity. E.g. a local social cost could be pollution from a local factory, when a national social cost might be carbon emissions for air traffic.
* Microsoft actions of business can have a dramatic effect on communities. For example, the company have many wires somewhere, which relates to the computing systems. The fire will be very dangerous and cause to local communities.
* Oxfam use of harmful materials or high energy consuming processes in the production of the items it purchases, disposal of waste products, relationships with local communities where activities take place. Community leaders therefore represent important interest groups.
Government: They have their authority to either block, promote or regulate firm activity. They will also can influence or persuade profitability through taxation. E.g. Business rates, PAYE, VAT, NIC, corporation tax etc.
* Government can influence both Microsoft and Oxfam profitability through taxation. E.g. Business rates, PAYE, VAT, NIC and Corporation tax etc. So the government wants the business to be successful and to create jobs and to pay taxes.
Links & Interdependencies: A firm needs to take account of the interests of all of its stakeholder's groupings. These interests are all linked together. The various interest groups are interdependent.
* Microsoft business to be successful, its stakeholders must work together, which they can make higher profits mean higher wages for the staff, higher tax revenue for government and increased dividends for the owners.
* Oxfam business conflict but sometimes will be staff lost and it can be seen profit decreased during disaster occur the business may need more staff and the time will more benefits or profits.
Conclusion
We studied so far in this unit, which is learnt about exploring business activity. For M3 assignment 5 we need to back up all the evidence from p2, p3 and p4.
In section 1: I created an organisational chart for both Microsoft and Oxfam. It should show the key areas of the businesses, and who is responsible for whom. The functional activities describe the key functions of my chosen businesses. Businesses are commonly organised in department carrying out these key functions.
In section 2: The aims of the businesses depend on the kind of business they are. For example, the aims of Oxfam will be quite different from those of Microsoft. A firm needs to have a clear sense of direction that should be clearly communicated to all stakeholders. Aim of the firms which are then split into objectives. The objectives set out more specifically how the aim can be achieved. For example, the aim of the Microsoft is to be the world's leading software supplier. The objective is to undercut the price of rivals; to take over other similar makers; to increase sales by giving discount price to the customers.
In section 3: A stakeholder is someone who has an interest in how the two businesses are running and the decisions it makes.
Distinction
For the coming year, evaluate how various external factors may impact on the business activities and stakeholders of one of my chosen businesses.
Assessment tips
Evaluate
* Analyse the various impacts in relation to business activity, aims & objectives, strategy, internal structures.
* Make a judgement about the importance of these factors on the organisation concerned.
* Your judgement must be supported by reasons.
Introduction
I still require continuing my research for distinction grade and it must involved from above assessment tips and make sure all these must be evaluated for the coming year.
Analyse the various impacts in relation to business activity, aims and objectives, strategy and internal structures.
The people of the two companies who have in interest in the decisions that businesses make are called stakeholders. So most decisions affect a number of stakeholders such as:
Customers: Microsoft desire for business goods, which must be high quality and value for money. Frequently, consumers are recognizing with brands when they purchase. For example, software's buyers need their products to be the best available for their needs and wants. This is how we would like to see improvements day by day of the Microsoft Company.
Regular customer of Microsoft can get a discount price for their interests needs.
Oxfam is appreciating to customer because of rising yearly funds event that helps to boost environmental charity scheme.
Supplier: Both businesses have to deliver stocks, however the payment of products could be done promptly.
Since 2002 and 2003 Oxfam has been holding a yearly supplier day. The purpose of this day is to give key suppliers an improved understanding of Oxfam GB as an organisation, to improve in future Oxfam's awareness of how the business is perceived as a customer and to bring about general improvement in working relations between Oxfam and its suppliers.
The supplier of Microsoft pushed forward to deliver windows application software's to other businesses and consumers, which they are required to increase advantages for their company.
Owners: The single owner can keep close attention on his/her company. The owners are again regarded to be the very important stakeholders because they may put a nice part of their life into setting up a business. They see themselves as being the main risk takers and also want to see the standing of their business grow overtime. Oxfam has no owners and it's supervised by trustees and usually set up to provide a service to the wider community.
Local and national communities: They might generally concern or worries of business activity. E.g. a local social cost could be pollution from a local factory, when a national social cost might be carbon emissions from air traffic, the pollution in next two or three months can be reduce by acquiring more staffs for the business.
Microsoft actions of business can have a dramatic effect on communities. For example, the company have many wires somewhere, which relates to the computing systems. The fire will be very dangerous and cause to local communities. How to improve so they must be able to check it regularly on daily basis but this is shall help to avoid risky by the time of next year January 2009.
Oxfam use of harmful materials or high energy consuming processes in the production of the items it purchases, disposal of waste products, relationships with local communities where activities take place. Community leaders therefore represent important interest groups. This is increasing for the business to avoid from harmful pollution.
Government: They have their authority to either block, promote or control firm activity. They will also persuade profitability through taxation. E.g. Business rates, PAYE, VAT, NIC, corporation tax etc.
Government can manage to influence both Microsoft and Oxfam profitability through taxation. E.g. Business rates, PAYE, VAT, NIC and Corporation tax etc. So the government wants these companies to be successful by next month and to create jobs and to pay taxes.
Strategies: The quantitative information about benefits might advise that the business have to be wary about expanding at any time. The qualitative information about growing customer preference for organic goods may recommend that they expand their organic lines. Both Microsoft and Oxfam need to create plans to take them forward into the future may be for five years or more. The plan must set out where the business wants to go, the aims and objectives, and details of how they will accomplish these aims; it is referred to as the strategy.
Aims and objectives: The aims of the companies depend on the kind of business they are. For example, the aims of Oxfam will be quite different from those of Microsoft. A firm needs to have a clear sense of direction that should be clearly communicated to all stakeholders. The aims of the businesses that can be split into objectives. The objectives set out more specifically how the aim can be achieved. For example, the aim of the Microsoft is to be the world's leading software supplier. The objective is to undercut the price of rivals; to take over other similar makers; to increase sales by giving discount price to the customers so this shall increase the needs of the company.
Internal structures: The two chosen businesses are Microsoft and Oxfam vital to generate a structure that will enable them to better meet the needs of their stakeholders. For example, an essential part of the structure of a private company is the Board of Directors with the MD at the top. By giving high priority to the Board means that the interests of the owners (stakeholders) are given priority.
However, the companies need to predict for the customers that are very significant organisational structure needs to ensure there are obvious links to customers. For example, the businesses can give priority to the position of customer service managers.
Make a judgement about the importance of these factors on the organisation concerned.
Factors
Organisations can be concerned on
Political
Funding
Wars and conflict
Government policies
Elections
Political trends
Government term and change
Trading polices
Economic
Interest and exchange rates
Taxation changes specific to product/services
Disposable income
Job growth/unemployment
Import/export ratios
Production level
Internal sources of finance i.e. banks, hire purchase, leasing and etc.
Market routes and distribution trends
Unit 1: Exploring business Activity