Businesss and Business Environment
Businesss and Business Environment
Businesss and Business Environment
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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.