Partnership- This is were a family or two friends might decide to set-up a business were they all equally share out the responsibilities and decisions the amount to set up a partner ship might range from 2-20 people, this might be Galpin and Solicitors or an electrical company between father and son.
Private Limited Company- A private limited company is one that only sells its shares to friends, families and workers for the company this might be electrical company linnells or engineering people. There must be at least two shareholders, but there is no maximum number. Shares can only be brought by the permission of the board of directors
Private sector- This is were private individuals own their own business which could be a public limited company under this category Adams would fall everything that is not owned by the government would fall under this category. The private sector is mostly all the shops in the city centre.
Public Limited Company public limited companies tend to be bigger than private limited companies its shares can be brought and sold over the stock exchange. The main advantage of selling shares on the stock exchange is that large amount of money can be made very quickly. One disadvantage is that the original shareholders can lose the control of the business if large amounts are purchased as part of a take over bid.
Public Sector This is government owned such as NHS, schools, hospitals it runs these by using tax on working people.
None Profitable or a charity. These are companies that are set up to help people and not to make profit for themselves example of this can be Oxfam or barnardos. Another way which they make money is by sending leaflets and posters asking for donations.
Franchise. Franchise basically means to hire out or licensing of the good ideas to other companies. A franchise grants permission to sell and trade under a certain name in a particular area. The person taking takes the franchise puts down a sum of money which is issued by the franchising company.
Operating. Some business is ran locally like a corner shop, which are not nationally spread. The type of business that do spread internationally are those plc such as McDonalds, Marks and Spencer and Adams etc. Adams offers its clothes worldwide ranging from different countries.
Adams started off by a lady named Amy Adams making baby clothes from her home in 1933 then made 3 stores Adams then joined with the foster brothers in 1973 and formed a partnership where 30 other stores opened then in the 1980s another 215 stores opened in the country in 1985 Adams became a subsidiary with the sears group. In 1997 Adams first franchise opened in Saudi Arabia. Adams had to go through all the procedures that I have mentioned above from a sole trader like Amy Adams to being a partnership with the foster brothers to being a hugely successful PLC like Adams. Adams has a franchise in Saudi Arabia and many other countries across the world also Adams does participate in helping young children as part of its voluntary work Adams is a profit motivated company where they keep the profits for themselves whereas a non profit company will give its profits to help the needy people and example of this can be Oxfam or Red Cross.
The advantages of Adams being a public limited company is that it has its shares brought and sold on the stock exchange, the main advantage of this is that capital can be raised quickly for the business, one disadvantage is that control of a business can be lost by the original shareholders if large quantities of shares are purchased as part of a take overbid. Selling new shares is quite a risky
Adams being a PLC is Appropriate seeing as it operates on an international level if it was a LTD it wouldn’t be able to survive seeing as it wouldn’t be able to raise the right amount of shares just from family and friends, whereas it is a PLC anybody can buy shares from the stock exchange from any part of the world which will be very sufficient for Adams for operate on an international level.
Limited And Unlimited Liability
In limited liability shareholder will have protection over what is lost is lost if the investment goes wrong because all that they would lose if the money that was invested this would only be related to plc or ltd where the shareholders will have limited liability this would mean that if the company did go bankrupt they would only lose the money that was invested into their shares. Unlimited liability this would relate to business such as sole traders and partnerships which would have unlimited liability this would mean if the company did go bankrupt they would lose everything this would include their cars homes and money that was invested. Adams has limited liability this would mean their shareholders would only lose money.
Access To Different Sources Of Finance
As companies become more sophisticated they will have a wider range of options to get raise finance. The way this is done is if a person takes out a loan to improve its income this loan comes from the bank. There is a special type of ownership called a sleeping partner can put money into the business but has no say in how the money is invested the sleeping partner has limited liability. When a company moves to a cooperate status it is able to draw on a much wide scale. This is not only wider access to sources of finance but also find it easier to raise finance because it is ore secure finically.
Control Control is they key consideration in deciding on what type of business to open. The great thing about being a sole trader is that it is your business you decide on all the decisions whereas if you are in a partnership you will have to share the decisions between 2-20 people where you might have disputes about where the company should go that’s why a deed of partnership should be signed before to minimise disputes. Many business prefer private limited to public limited companies because the owner will have more control over the business that why. If a company does become a public limited company there is a danger of losing the control because shares can be sold on the stock market.and groups or individuals can take over by buying lots of shares.
Use Of Profits
The biggest benefit of being a sole trader is that you keep the profits that you make but you would also have to pay for the loses that are made. In a partnership the cost is divided so the sole trader should think carefully when taking on a partner. In some companies shareholders may receive a reward for owning shares one is can be paid a dividend another is by selling there shares were they get a income.
Legal Liabilities
Different types of companies are faced with different types of legal requirements. The more complex the legal requirements, the more the more the company will need to hire lawyers unlike smaller companies. There is also less paperwork for sole traders and partnerships unlike an Ltd or a Plc where they have to issue a example of a paperwork is tax liabilities. All limited companies must present a memorandum of association and a article of association when they are setting up their Ltd so that they can receive a certificate of incorporation. The memorandum will show
∙ Name
∙ Registered address
∙ Objectives
∙ Capital
Most companies will produce a fairly vague list of objectives in their memorandum. This will give them the opportunity to alter their activities if market opportunities arise.
The articles of association set out that govern the inside working of a company. They include the following
∙ The rights attached to the holding of the various types of shares offered by the company
∙ The rules and procedures for issuing and transferring shares
∙ The procedures and timing of the company meeting
∙ The details of how accounts will be kept and recorded.
∙ The powers and responsibilities of directors
∙ The details of how company officers will be appointed
Adams is in the private sector it is a Plc will means that its shares get sold on the stock market its shareholders have limited liability which would help shareholders because they wont lose everything that way. Another advantage is if Adams ever needs money it can borrow of banks quicker than smaller companies because they are more financially secure but it would mean they would have to pay back at a high interest rate this is a reason that many LTD change to being a PLC so that they can raise finance quicker and to operate on a wider scale. The disadvantage is that the control would lose because it turns in to a Plc where they can’t control who buys the shares and would leave the owner with les control. When Adams turned into a Plc it meant that more people were investing money into they company, which meant that they could gain more profits due to these investments. Adams has also got to keep up with its liabilities and has to fill in its tax’s of what it owes top the government also it has to have top lawyers so that no illegal trade is happening so that it can not get sued for making forged documents about trade.
Types Of Culture
Power Cultures The centralisation of power is the key feature of power culture. It is frequently found in small organisations where control rests with a single individual or small group of people of people. The structure of power culture is best pictured as a spider web. There is a central power source and then rays of influence spreading out.
Role culture The role culture is typical bureaucracies. These are large organisations in which all members have a defined job or a role to carryout. Business would divide into various functions. These would have hierarchy-ordering offices.
Task Culture Task culture become very important in business in the first decade of the twenty first century. Many people today work in teams. These teams may work together for a short or a long time to complete the task. In a task culture teams will often have considerable input in determining how a particular job is to done. Their views and opinions will be listened to.
Person Culture In a person culture, individuals are central. The organisation exists only to serve the interests of those within it. Person cultures are most likely to be found in co-operatives and not for profit organisations like charity work. In a person culture an individual may leave the group but the organisation cannot sack the person also their person has a lot of freedom to adapt to how he or she wants.
Backward- facing forward looking Another distinction that is frequently made is between backward facing cultures, which are based on what has gone before in an organisation and forward looking cultures, which enable rapid change into the future.
One important aspect of organisational culture is the emphasis on tradition. Some organisations are heavily influenced by previous practice, legends and ways of doing things. Other organisations are innovative and entrepreneurial, with little respect for previous patterns or methods. For example Anita Roddick has started that being prepared to run in the opposite direction to convention and to be prepared to break the rules is part of the culture.
A company with backward facings likely to be
∙ Procedure led
∙ Controlled by traditional managers who have been in the organisation for long time
∙ Conservative in attitude
∙ Resistant to change
∙ Inward looking
∙ A risk avoider
Role culture is the type of culture that Adams uses seeing as when it employees its workers are hired their job is explained to them already in their job description so that when they go into work they can get on with it straight away instead of having to keeping asking the manager what they have to do for the day. This sort of culture is good seeing as then everybody will know what is involved in their job before they start which will mean that everybody gets treated the same and as equals. It also helps so that employees are not doing the same work and is able to get the most out of their workers. The culture does help the actual structure seeing as everybody knows what they are doing and because the job description was sent from somebody in a higher role, which will make the culture and structure compliant each other Role culture would mean that everybody working for that company would have top play their individual role to compete with rivals and also yet working as a team to get objectives done effectively. So that is why when employees of Adams come in to they believe that working hard as a team will be able to over come any target set by the company Adams offers its clothes to many different parts of they world ranging from the Middle East, Europe, and north South America Adams understands that these people will want distinctive clothes different pattern and designs. This culture works by logic and rationality with out these two it would make the culture very difficult to operate.
A set of guiding principles have been established for the whole Adams team
- ‘We understand kids & their mums and dads’
- ‘We always work with passion, commitment and enthusiasm’
- ‘We trust people to do the right thing’
- ‘We continually learn from everything we do’
- ‘We have tolerance for honest mistakes’
Hierarchical structures
Adams uses a hierarchical structure this is the traditional way of developing an organisation that was so much popular for companies of the twentieth century. It was popular because the century saw the growth of very large organisations that, in the days prior to the widespread use and application of information and communication technology, were thought to be appropriate because they could ensure command and control of an organisation. Hierarchical organisations were managed by detailed systems and procedures, and systems thinking dominated much of the thinking about how the organisation should be run.
The hierarchy in Adams is the order of the business is the order or level of management, from the lowest to the highest rank. It shows the chain of command within the organisation. Orders pass down the levels and information passes up. It is generally held that, the greater the number of levels in the hierarchy the less effective in communication process is. You could also say that Adams does use centralised and decentralised structure but a bit of as you can at the top is the managing director but the rest is spaced with everybody at the bottom sharing the same responsibilities as regional managers as you can see the span of control the does not have many layers but at the top there is a lot of power between the M.D and the head of retail but the regional managers also have power within there region.
Management style
Adams management style is consultative managers are ones who seek to consult other people before making a decision. Alternatively, they will seek to consult people before implementing a decision. This type of manager wants to draw on more sources of opinion than just him or herself. The consultative manager will have listening skills and so the ability to create the right sorts of channels to consult other people. In Adams their are a series of mechanisms e.g. newsletters, team briefings suggestion box etc. that makes it possible to get the concerns of the people involved in the decision making process. This is a advantage because then the people lower down the organisation structure will have a chance to put in what they think can be improved so that they don’t feel left out when decisions are being made and to get as many opinions as possible before taking any action to what needs to be improved. You could also say that Adams also uses a democratic approach, which involves giving individuals responsibility to make decisions, but to a controlled amount this will then hold the individual or team is accountable for the decision that it chooses to make. Adams does use this approach to a certain amount. This would mean that workers are given more responsibility and more freedom to make open decisions and they would feel more involved then they actually are.
How the organisational structure, culture, and management style help to meet its objectives.
The management style would help Adams to achieve its objectives as it gives individuals more power to make decisions making them feel important so therefore they will want to work harder to return the favour by working harder it will improve their customer service and in turn show effect on the amount of profits that they make. This has given the employee motivation where by the performance of that employee has improved which will then make other employees want to work harder. The structure is a key factor in achieving business objectives because everybody need to know where they belong on the structure this is very will explained at Adams so when each person at every level knows their objective it would mean their would be successful but if someone has misunderstood their role in the structure then it would result in Adams failing the set objectives. The role culture this is important so that employees know what is expected from them so they know what to do when they get to work instead of asking the manager this gives the manager to look at the way operations are handled in Adams. Role culture also helps Adams as that they can then achieve their objectives and they will know the standard of performance they must reach to achieve these
Adams Communication
Adams uses all variety of communication methods from formal and informal, which will mean giving out official meetings, memos, newsletters Informal communications are ones that take place that are not part of the officially Adams. This does not mean informal communications are necessarily negative or anti organisational most of the good work in Adams is carried out by employees taking into their own hands and coming up with ideas that directly benefit Adams. Research into the nature of communications in Adams indicates it is important to have both formal and informal communication. The manager may break information to employees through team briefings, but full understanding of what management has had to say may come about only through informal discussions and conversations have and educative impact within Adams and most managers recognise the importance of informal communications networks. There is a danger of misleading information being spread along. This happens when plans are being made. Individuals involved in the informal communications networks may deliberately distort messages or, through lack of understanding of what is going on, may give confusing information. That is why it is important to know what is happening so that you will be able to apply what you have been told into the objectives that need to be completed. If there is a error or a misunderstanding as I have already mentioned then it would mean that those objectives have been failed or not completed due to the communication or another factor.
Impact of ICT on internal and external communications Adams uses ICT mainly from their head office which is based in Worchester to receive emails from supplier’s customers and other people who are stakeholders inside Adams. Adams also has its own website where you can look at the clothes that Adams sells and the history of Adams where details are published for public viewing. They can also buy the products online from Argos Additions catalogue which is available online. This will then have a great impact for Adams seeing as Argos Additions will have to pay them for the goods and the customers are happy to have the clothes delivered to them at their door. Also the telephone where customers are able to phone up and ask queries and comments if there is any complaints also E-mail therefore external communications has improved greatly customers can use a range of methods to get in contact with Adams ranging from letters, E-mail, phone, fax these have improved Adams communication greatly.
ICT has changed the means of communicating because it has saved time for example sending E-mails you can send many E-mails at any one time instead of phoning each place individually. Another thing is that it makes it much easier for Adams because they can look at their website and see what their prices are so that they are able to match their prices instead of having to go around asking which is time consuming. ICT has made Adams able to communicate on a wider scale so that it is able to reach everyone and has certainly saved Adams a huge amount of money. Also there are internal phones which helps if something is not available on display they can call someone upstairs to go and get it for them. ICT also enhanced communications internally as now information can get sent from the region manager to the manager instantly saving the region manager time and extra costs for transport.
Strengths of ICT It is more secure to use the internet where you know everything gets sent directly unlike posting where it can be time consuming and has to go through different procedures where it might get lost. It will make mistakes less likely to happen as it is written down especially when ordering from the suppliers and you have a copy of the Email sent a huge strength is that it will save a large deposit of money for a Adams. Customers can order over the Internet, which saves them the hassle of having to go out with their kids to purchase the clothes.
Weakness of ICT There are very little weakness such as their might be a system error on the computer or a bug which makes it difficult to make the computer operational another hazard is the Email might not be received by the recipient. You could say overall the strengths out weight the weakness and that ICT is worth using over conventional methods such as Posting.
Functions
Adams carries very little of these functions they do finance by taking the money to the bank and paying it in checking how much they have made Adams carries out the finance, and some of the Human resource. Most of this is carried out at head office where the employees make certain products and designs, marketing these products and all the administration work and the research and development into new products get carried out there as well.
Finance helps Adams to meet its objectives by making sure that there is enough money coming into the business and less going out. Adams keeps a detailed record of all money paid in and out and present the final balance sheet, sources and uses of funds, profit and loss account, and other financial records at regular intervals. At Adams only the manager clears the money at different times to avoid any criminal acts by any workers. Adams accounts are stored on computers this information gets sent through to the main HQ at Worchester through a company networking system it is usually done by the area manager.
The management accounting duties is carried out at Worchester after it has received all of our information it is then there responsibility to direct the company in certain directions hopefully the right ones, this is based on figures which they receive and current predictions to make future predictions. Management accounts at Worchester will break down figures, to extract information about the present performance and what sorts of improvement can be made in the future. Every thing that happens at Adam in the head office will find out about it so it is important that they inform them if the business is making a loss so the finance side of the business is probably the most important because if you don’t have enough security the business will not survive so it is very important to maintain this so the business will meet its objectives.
Production
If you do not create a quality product that does not sell you would not be able to survive very long the product must be cheap for the consumer it must be cost sufficient and also most have quality so it lasts so if this fails it would mean the companies objectives would also fail.
The human resources side Adams is usually left to each store it is up to them to do the required recruitment and also to provide the training an also to maintain good performance management by watching if they are employing enough staff at the current time or to many, so if they do not get this right the business would not be able to achieve its objectives
Marketing
is done at Head office they decide whether to put a product on sale if its not doing to well or have some sort of offer come with just anything to get it sold. They mainly know what product to advertise based on the performance figures, which they have been sent through
Administration
Is important because calls queries and enquires have to happen this is more so at head office but is also up to staff at all the branches if the customer service is not there the company would not be able to meet its objectives because of dissatisfied customers the orders would not get through to the stores so that means the products would not be able to be sold so the company would lose money and fall below its objectives.
Research and development
If you don’t do the relevant research on the customer trends then how are you going to know what the customer want at what form with which features i.e. what colour is poplar a materials last longest
The connections between the functional areas.
If the was no finance department all the other departments will not be able to survive as the will be no money
If it weren’t for HR people working on the production process wont have jobs
If there’s no finance there’s not going to be enough money to market products do research and development would also not be able to pay for administration.
If it weren’t for the research and development the product would not be what it is and so on...
All the functions need one another is one collapse they will all collapse
Self Checking Or Inspection
Employees monitor and check their own performance and that of the process they are working on against given standards, or should these be subject to outside inspection.
By developing a quality culture there should be no need to inspect. In the employees for Adams know the standards and thus can develop the systems to ensure quality is effectively guaranteed. There are a lot to be said for this if people understand the required quality standards they can make sure they are met. Failure to ensure quality would be the responsibility of the manager because they create the quality systems. It is then up to individual staff to implement these systems. The staffs are the best people to implement the systems because they know what is going well and what is going badly at grass roots level. Involving ground level staff in ensuring quality means they are more motivated because they have a better understanding of the objectives of the organisation they work for. Another major advantage of self-checking is that it is cheaper to carryout. Improvement is continuous process, and you do not have to wait for the problems to come to light at the end of the process. Of course inspection is also important to check standards are being met. However, perhaps the inspection should be just to check quality standards have been implanted effectively.
Adams could use is TQM total quality management the advantage of using TQM is that it encourages everybody working in Adams to think carefully about quality this would mean that efficiency would be improved when working as employees are determined to improve quality this refers to everybody not only the production team. TQM encourages all the employees to get the job right the first time this would save money and time and by achieving these two they would help Adams to make a big profit and save time which will mean the company get more time with their workers this cuts cost and wastage and ensures customer satisfaction so that it is able to achieve its objectives. There is a slight problem to this and that is that TQM only tells employees to think about quality it doesn’t give any specific information telling them what exactly to do.
Here are some benefits
- It enables Adams to focus on the customer
- It enables Adams to focus on quality
- Teamwork is emphasised
- The emphasis is placed on continuous improvement
- The system builds in control mechanisms and accountability
Here are some disadvantages
- The system requires considerable planning and is expensive
- TQM requires a commitment from all those involved in the process
- Setting up quality systems involves considerable paperwork and bureaucracy.
- Stress may arise from establishing TQM process
- At times, TQM is based more on rhetoric rather than on practice
Adams adds value to its products by making the children’s clothes more resistant to stains and spillages. Then by giving it a longer durability this will add value to its product automationally seeing as most parents are looking for long lasting clothes and at a tight budget, they will be aware that the clothes will be going through rigorous washing and therefore need value for money. Therefore Adams will need to spend huge amounts of money on research and development by making the clothes able to go through these procedures and coming out at top levels able to sell to the consumers.
Adams guarantees quality assurance for its products by having labels and tags on each set of clothing informing the customer at what levels the clothes should be washed at. For shoes you can offer the customer certain shoe polishes that will help to ensure the shoes stay newer for longer instead of being worn out and the customer to come back and buy a new set of shoes. So by selling this customer will think the shoes will be able to last longer and improve the quality of that particular product.
Advantages
Longer lasting product
Customer satisfaction
More customers
More profits
Disadvantages
Hard to convince the customer
Might have complaints about quality
Effects it has on functions of the business and how it achieves its objectives
This will help Adams achieve its objectives because by selling extras it helps to boost and maximise sells, which is the main objective of any organisation. It will also mean that Adams have helped to achieve the customers objective and that in turn has achieved their objective of guaranteeing customer satisfaction which will result in the customer coming back. By tagging clothes it will help the production department who process the products because they can just check the labels to make sure that everything is correct like the materials, temperature to be washed at, whether it is safe to use with the tumble drier. It will also help the customer so when they buy the product they can simple just check the tag to see how to wash the product. This will also help the marketing department seeing as they will need some sort of facts to base their promotion on and this will be ideal specially for mother who have other young children and don’t have much time to go out.
