Businesss and Business Environment

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HO CHI MINH CITY UNIVERSITY OF TECHNOLOGI AND EDUCATION

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BUSINESSS AND BUSINESS ENVIRONMENT

Assignment title: Organization scopes, functions and Environment

Lecturer: Mr. Soumitra Chowdhury


Student name: Bui Nguyen Phuong Trinh
Student ID: 20BM40212

Ho Chi Minh City, December 2022


Introduction
An organization is organized by group of people with a specific purpose such as business or
public serving. The managers take different types of actions in the organization such as planning,
organizing, directing, controlling and staffing. Internal and external factors of the business
environment that can affect the activities of the business. VinFast is Vietnam's first automobile
brand established in June 2017. It is also a subsidiary of Vietnam's largest private enterprise -
Vingroup. The company's name stands for the phrase: Vietnam - Style - Safety - Creativity -
Pioneer, this represents the aspiration to build a Vietnamese brand with class and recognition in
the international arena. And open up opportunities to own cars and motorbikes in accordance
with the market, needs and income of people.
This report will include different types of organization and their purpose of their existence. The
relationship between the different functions of the organization, the linkages to the goals and the
organizational structure. It also shows the effects of the macro environment on the surrounding
economic activities.

Task 1: LO1 Explain the different types, size and scope of


organizations.
P1. Explain different types and purposes of organizations; public, private and
voluntary sectors and legal structures.
Different types of organizations:
In the business environment, there are many different types of businesses found in the economy,
ranging from small single-person businesses to large multinational businesses spread around the
world. Diverse organizations have various structures and purpose in perspective of customers.
Each type of business has its own advantages and disadvantages. Choosing the right form of
business ownership is an important decision.
Differences between for profit and not for profit and non-government organizations
(NGOs).
An organization is a collection of individuals who work together for a shared purpose in a stable
structural form of society. In terms of business it is defined as an entity formed for the purpose of
carrying on commercial enterprise such as producing goods or services and meet needs of the
customers.
Types of organizations.
The types of organization can be appraised through the allocation of different contexts. When
considering an organization's profitability, it can be examined through two different concepts
that are for-profit organizations and non-profit organizations. Organizations or business
enterprises can also be evaluated from the framework of enterprise establishment concerning
numerous other concepts such as functionality, size, objectives etc. In addition, the types of
organizations are also divided in accordance with the legal status of their business enterprise
such as sole proprietorship, partnership and companies.
For-profit, non-profit and non-governmental organizations.
 For-profit organizations: It is an organization that operates for the purpose of making a
profit. Most corporate businesses such as serving customers by selling products or
services and business organizations are considered to be for-profit organizations. The
business owner earns an income from the for-profit and they can spend some or all of it
on the business itself. For-profit organizations are legally established organizations in the
corporate law of the region.
 Non-Profit or Not for Profit organizations: These organizations mainly consist of
social enterprises and charities working for specific purposes. They do not work only to
earn profits, but their priority is first to serve society. Non-profits do not distribute profit
to anything other than furthering the advancement of the organization and serving the
public interest. These organizations are subject to laws and regulations that are
independent of financial tax policy. However, the use of finance is often monitored by the
authorities to ensure the safe handling of money.
 Non-governmental Organizations (NGOs): Non-governmental organizations are
established by voluntary group of individuals or organizations and usually not affiliated
with any government, for the purpose of political or social service such as environmental
protection or humanitarian. Although the activities of NGOs do not involve government,
the government can regulate them through the submission of affidavits representing the
NGO's funding, management, and activities. NGOs are independently governed by their
individual boards and are responsible for compliance with laws specifically established
for non-governmental organizations.
Micro, small, medium-sized enterprises (SMEs) Different business purposes, objectives and
supply of goods and services.
 Micro enterprises: They include small business areas where employment levels are low
along with low investment capital. This type of enterprise is being formed in large
numbers in developing countries, where all needs for goods and services are provided by
micro enterprises. This adds value to their economy, thus widening the scope for better
income and growth opportunities as well as reducing the cost of doing business.
 Small enterprises: A small business is considered a separate business entity, which may
include a partnership business with affiliates and subsidiaries. They are private agencies
managed by a single owner. They work together and change the size and revenue
structure accordingly (Bryman, and Bell, 2015).
 Medium-sized enterprises (SMEs): Medium-sized enterprises include multinational
companies operating as part of the government sector from which they earn huge
revenues. They also play an important role in contributing to productivity growth. The
profits they make are used for future development purposes such as developing the
internal aspects of the company to be better.
P2: Explain the Size and Scope of a Range of Different Types of
Organizations.
The range of legal structures associated with different forms of business: sole
proprietorship, partnerships and companies.
Sole proprietorship: This is perhaps the oldest form of business ownership and the simplest
form of business organization. Many large companies start as a sole proprietorship, that is, a one-
person business organization that is owned and managed entirely by one individual. The sole
proprietor is legally responsible for the business in his or her personal field. If the business
suffers a loss or the business faces any legal challenges, the business owner is responsible for
paying any alleged payables from the owner's personal assets.
Partnerships: A partnership is an association of two or more people conducting business
together. Any individual entering into a partnership should necessarily have a written agreement.
In this form of business establishment, the profits under the original contract or capital brought
by each partner are distributed. Most partnerships have unlimited liability, although sometimes
some general partners may have limited liability.
Companies: Company is very different from a sole proprietorship or partnership and is owned
by shareholders. To register a company, you need to go through a lot of procedures. There are
two types of companies:
 Private Limited Company: Private limited enterprises are owned by shareholders and
they elect a Board of Directors to run the company. A private corporation has a maximum
number of shareholders from two to a maximum of 50. The shareholders of the company
cannot easily sell or transfer shares to outsiders. In addition, they are not obligated to
make their data publicly available. Private limited companies are separate legal entities
and are separately responsible for their actions. The name of the private company ends
with the words "Private Limited" or "Pte Ltd".
 Public Limited Companies: A public limited company has an unlimited number of
shareholders from 7 people. The company's share is freely bought and sold by members
of the public. Public companies must public its financial reports for public circulation.
These companies are also recognized as separate legal entities regardless of the personal
assets of the owners. The name of the public company ends with the words "Limited" or
"Ltd".

M1: Analyze How the Structure, Size and Scope of Different Organizations
Link to The Business Objectives and Product and Services Offered by The
Organization.
Size and scope of organizations:
Differences between large, medium-sized and small organizations including objectives and
goals, market share, profit share, growth and sustainability.
The goal of micro, small and medium business corporations alike is to generate revenue and
maximize profits. Small businesses with smaller size and market share should contribute less to
the economy. Medium-sized organizations on a comparative basis comprise a larger workforce
than small businesses with more employees working and generating higher profits. Medium
businesses have larger revenue and market share than small businesses. Larger corporations
capture the majority of the market share, so they will have a large work base with more workers
and will generate the greatest profits. However, small and medium-sized organizations have
higher growth potential than large corporations. Large corporations are more sustainable and
long-term development than small and medium enterprises.
Global growth and developments of transnational, international and global organizations.
Due to the development and prevalence of technology along with the global internet, major
corporations have been able to easily move their business from one place to another and become
known to everyone. Corporations are more predominant in the global business world thanks to
their logos and brand recognition. The strong development of science - technology has promoted
the outstanding development of the fields of social life and the high socialization of the
productive forces. Business expansion due to import and export organizations has skyrocketed in
the past century, contributing to propelling the world forward on the path of civilization and
prosperity.
Differences between franchising, joint ventures and licensing Industrial structures and
competitive analysis.
 Franchising: Franchising is a business activity in which the organization that owns the
business system (the franchisor) grants an individual or a group (the franchisee) the right
to use the brand name, products and services of the company. Franchising is the most
effective way to grow an organization.
 Licensing: It is a business agreement to license another business to use and manufacture
a company's products within a defined market area for a specified payment.
 Joint ventures: A joint venture (JV) is a written agreement by two or more parties for
the purpose of jointly using resources to accomplish a certain goal. In a joint venture,
each participant is responsible for the associated profits and costs.
Market forces and economic operations e.g. scarcity and choice, supply and demand,
income elasticity.
Supply is the first factor in the supply-demand relationship. Supply means the overall quantity of
goods and services available to consumers in an economy. Supply is the business behavior of
producers in the market. The relationship between the price and quantity of an item is called the
supply relationship. Demand is the next factor in the supply-demand relationship. Demand is the
quantity of a particular good that consumers are willing to buy and use at different prices.
Demand is an expression of consumer behavior in the market. A major factor that affects the
function of supply and demand is scarcity, as it refers to a shortage in quantity of an item in the
market. Elasticity is the relationship between supply and demand to the change in the price of a
good or service.
Stakeholders and responsibilities of organizations to meet different stakeholder interests
and expectations.
Stakeholders are any individuals or organizations affected by business activities. Typical
stakeholders are customers, governments, investors, employees, communities and suppliers.
Stakeholders are important because they can directly or indirectly influence the business of the
enterprise. Customers want the product or service that businesses provide and they expect it to be
of quality and contain value. The government is an indirect stakeholder because it relies on the
business for tax revenue, government organizations require corporations to comply with the
legislation and to conduct corporate operations in compliance with regulations. Investors have
invested capital in the business, so they are interested in getting a profit from that investment.
Employees are people who work in a company and they are tied to the continued success of that
company. Communities do not want business activities to negatively affect their safety, health or
economic development. Organizations that fail to meet the needs of their stakeholders often
suffer serious consequences or even go bankrupt.
Task 2: LO2 Demonstrate the interrelationship of the various functions
within VinFast and how they link to organizational structure.

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