Large Scale Organisations (LSOs) in Context

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Information about Large Scale Organisations (LSOs) in Context
Business & Mgmt

Published on February 21, 2014

Author: mangobells



VCE Business Management, Unit 3, Outcome 1
Large Scale Organisations in Context

LARGE SCALE ORGANISATIONS Defined by the ABS as a company with 200+ employees and has substantial assets ($200 million+) and a large revenue. Characteristics of an LSO (they may not possess all, but instead multiple): • 200+ employees • $200 million in assets • Board of directors • Transnational • Large market share • Large (substantial) revenue

+ POSITIVE CONTRIBUTIONS OF AN LSO • Provide mass employment (200+) • Research and development, because it is generally costly often it is only LSOs who can engage in research and development • Contribute to the B.O.P (Balance of Payment) with exports • Undertake investments which can lead to economic growth • Stimulate infrastructure growth, which is needed by everyone and the economy as a whole • Taxes to the government • Innovation • Provides choice of goods

-- NEGATIVE CONTRIBUTIONS OF AN LSO • Outsourcing, which is regarded as bad because it is considered taking away jobs from Australians. Takes away money from economy • Downsizing • Costly research and development • Damage to environment • Abuses of market power • Consumer exploitation

TYPES OF ORGANISATIONS • Corporations (companies)  Aim to make a profit through the manufacture or trading of goods or provision of services.  Public (owned by 50+ shareholders)  Private (owned by up to 50+ shareholders)  Government owned (GBEs) • Government departments  Aim to provide a high level of service within a specified field  Government departments (education, health, welfare)  Government business enterprises • Charities and foundations (NGOs)  Aim to provide goods, services or funds for the alleviation of specific social problems

CORPORATIONS (COMPANIES) Public companies • (Ltd) • On the stock exchange • Can be owned by government • 50+ shareholders Private companies • (Pty Ltd) • 2-50+ owners/shareholders • Not on stock exchange (invite only) • Not owned by government

GOVERNMENT DEPARTMENTS Government Business Enterprise (GBE’s) • Government owned and operated/partly owned • All profits go to government • Provide a service that may not be profitable • E.g. medibank, Australia Post, Vicroads Government Departments • Education, welfare, health • Provides a service, not profit • E.g. centrelink, medicare, Dept. of Education

MANAGEMENT FUNCTIONS A MANAGERS JOB IS TO PLAN AND COORDINATE THE RESOURCES & ACTIVITIES OF AN ORGANISATION TO ENSURE THAT IT ACHIEVES THE GOALS AND OBJECTIVES DEFINED BY THE BOARD OF DIRECTORS M – Marketing – promotional service, reputation, effectiveness R – Research and development – products are updated and meet needs H – Human resources – training, recruitment, and management of staff O – Operations – efficiency, quality of service, production F – Finances – budget control

OBJECTIVES, VISION, MISSION Objectives: • a desired goal that an organisation intends to achieve • provide a common focus • used when evaluating success to see if they’ve been met Vision statement: • What an organisation aspires to become • Outline their overall goal/concept Mission statement: • Expresses an organisations purpose, reason, and how it will operate • Provides direction and their plans to achieve their objectives • Reflects their values and ideas

OPERATING ENVIRONMENTS External: • Macro environment: Forces, conditions and trends in economy & society that indirectly affect organisations • Operating environment: Stakeholders that have a direct impact on business day-to day running Internal: the inner workings that a business has control over

MACRO, OPERATING AND INTERNAL ENVIRONMENTS Macro • Political: government, policies, carbon tax • Legal: OHS, FWA, laws • Economic: employment, consumer spending, stock exchange (supplier, market share) • Technological: competition, advancements, problems ($) • Social: women's employment Operating • • • • Customers: relationship to business, happy/complaint Suppliers: change of delivery, change in costs Competition: drop prices/increase Interest Groups: environmentalists, trade unions, consumer groups, anti-gambling Internal • • • • policies employees structure corporate culture

KEY PERFORMANCE INDICATORS FOR LSO’S Specific Measurement of LSO’s efficiency & effectiveness in their achievement of objectives Key Performance Indicator How to measure Number of Sales Allows an organisation to determine whether it is meeting sales forecasts and whether they need to look at ways to increase sales Percentage of Market Share the percentage of sales or business that one firm has compared with its competitors in the same industry If market share increases then the organisation has a greater percentage of the market and sales Net Profit Figures Profit is the difference between revenue and expenses. Usually a level of profit will be determined as acceptable by the organisation Productivity rate & Growth Productivity measures the organisations ability to transform inputs into outputs. Increasing productivity = using resources more efficiently Level of Staff Turnover Measures the number of people leaving an organisation. High turnover may equal dissatisfaction in the workplace. Customer Complains The number of customer complaints is an indicator of how customers view the organisation.

STAKEHOLDERS Individual or group that has a direct or vested interest in the activities of an organisation Internal: Operating: Macro: • • directors: gain status, develop strategy decision • management: achieve goals, secure position, job satisfaction • employees: money, career, safe environment, ethical & • • shareholders (owns job social responsibility, shares in a company: security & motivation • stakeholder) interested in money, • trade unions: fair go of members, involved in decision making • suppliers: profitable business, paid, long term relationship • community: good quality, care for environment, participation, benef it • customers: good quality products, service, SRB • competitors: differentiation, comparison • • government: tax, infrastructure

BUSINESS STRATEGY A series of actions developed and implemented by an organisation to achieve its goals & objectives • STRATEGIC Planning: Long term (2-5years) senior management • TACTICAL Planning: 1-2 years, middle management  OPERATIONAL Planning: short term (daily, monthly, up to 12 months) front line managers

ETHICS AND SOCIAL RESPONSIBILITY BUSINESS ETHICS: THE MORAL STANDARDS THAT GOVERN THE ORGANISATION’S PRACTICES AND SOCIAL RESPONSIBILITY IS HOW THE ORGANISATION INTENDS TO BENEFIT THE ENVIRONMENT AND THE COMMUNITY AT LARGE, BEYOND THE LEGAL REQUIREMENTS • In the INPUT element of operations: • Deal with suppliers with honesty & fairness. E.g.: payment, time of products. • Environmentally sustainability inputs. E.g.: reduce, reuse, recycle • Minimise electricity. E.g.: carbon dioxide into globalisation • Facilities shouldn’t compromise staff health or safety • Process element: • use of labour, staff shouldn’t be abused, paid fairly, treated with respect. • OHS • Disposal of wastes, socially responsible • Customer relations • Output element: • benefit to society • product is safe, no threat to customer • product reliability • product marketing is honest and not misleading • sensitive to community not offensive

Business strategy – Very specific details of all stages that must be completed to achieve a plan Corporatisation - still owned by government but ran/structured like a private, focusing on profit, which goes to the government business that one firm has compared with its competitors in the same industry Negative externalities – the unintended and undesirable by-products of production Privatisation - company sold into private sector & ran/owned accordingly Research and development – the process of investigating new advances, then transforming them into a viable product that can be utilised by the organisation Economies of scale – the ability of larger businesses to afford to buy the necessary machinery or bulk buy raw materials, so that they can produce items at a greatly reduced price Triple bottom-line (TBL or 3BL) accounting – a method of evaluating how well an organisation has performed in terms of financial (economic), social and environmental factors. Effectiveness – the process of achieving all stated goals and objectives Efficiency – the process of making best possible use of resources Gross Domestic Product (GDP) – the total value of goods and services produced within a given time period DEFINITIONS Market share – the percentage of sales or

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