business administration notes 27th april 11

8/3/2019 Business Administration Notes 27th April 11

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WELCOME TO BUSINESSADMINISTRATION

David Golden

[email protected] LEVEL 5


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PURPOSE OF THIS MODULE

TO PROVIDE AN UNDERSTANDING OFORGANISATIONS AND THEIR

ADMINISTRATIVE FUNCTIONS.

DEVELOP PRACTICALSKILLSNECESSARY TO PERFORM

ADMINISTRATIVE DUTIES.

ALSO TO PREPARE FOR FURTHERSTUDYIN RELATED AREAS.


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GENERAL AIMS

Understand the features of anorganisation.

Appreciate the impact of the factors which

affect an organisation. Understanding financial aspects of

Business Organisations

Appreciating legal aspects oforganisations.

Undertaking stock control duties

Process business documents accurately

and efficiently.


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COURSE OVERVIEWModule is Made up of 5 Units

Unit 1. The Organisation

Unit 2. Finance, Money, Banking, Fgn

ExUnit 3. Human Resources

Unit 4 Preparing for Meetings

Unit 5. Processing Business Documents


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Assessment

Assignment 1. 30% - Collect,present relevant information .Analyse an organisation. Discuss

range of issues in relation toorganisation and present yourfindings.

Assignment 2. 30% - Processingdocuments correctly, accuratelyand using appropriate letters.

Exam 40% answer 4/5 questions


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Sources of Reference

Effective Business Communications

Hildebrandt & Murphy 1991

Organisational Behaviour

Hellriegel, Slocum, Woodman 1995

The Interpersonal Communication Book

De Vito 1992

Business Administration Douglas 2008

Modern Business Administration

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Learning Outcomes forUnit 1. The Organisation

IDENTIFY DIFFERENT TYPES OF ORGANISATIONS

IDENTIFY DIFFERENT FEATURES OFORGANISATIONS

LIST DEPARTMENTS WITHIN ORGANISATIONS

DESIGN AN ORGANISATION CHART

LIST ENVIORNMENTAL FEATURES THAT IMPACTORGANISATIONS
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Unit 1. Learning OutcomesContd

IDENTIFY MAIN FUNCTIONS OFMANAGEMENT

EXPLAIN IMPORTANCE OF EFFECTIVE

COMMUNICATION EXPLAIN THE NEED FOR QUALITY OUTLINE QUALITY CONTROL

TECHNIQUES LIST QUALITY AWARDS
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Time Out

For your interest learn somethingnew about yourself.

VAK questionnaire
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Back to Work!

Lets come up with a Group Contract
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Part 1. Aims to Cover

1.1 To identify different types oforganisation

1.2 look at distinguishing features ofeach organisation type

1.3 list the different departments inan organisation and discussed their

role. 1.4 Identify and design an

organisation chart.


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What is an Organisation?

A system of Co-operative HumanActivitiesBernard

Organising involves dividing up tasks,

allocating tasks best, coordinating andmonitoring to achieve agreed aims.

As we learn more about organisationsplease consider what type of

organisation appeals to you and why. Whats it like to work in different

organisations? What is Business?Please Discuss.
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1.1 Identify Types ofOrganisations

Sole Trader

Partnerships

Private limited Companies

Public Limited Companies

Charities

Co Operatives Partnerships

Semi-State Bodies

Government Bodies

Friendly Societies
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Key Principles that dictate theshape of an Organisation

Unity ofpurpose and Command everyone knowswho they are answerable to.

Amount of Delegation A high level of dividing upresponsibilities leads to more levels.

Size of Organisation The larger the organisation,the taller the shape as a greater division of workand delegation is required.

Number and type of Employees The larger theorganisation the greater the number of levels ofauthority.

Span of Control One Superior and a varyingnumber of subordinates. The wider the span, thefewer the levels of authorityA narrow span willcreate a tall structure
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1.2 Other factors determiningorganisational design

1. FORMAL

Designed to achieve a specific goal

Division of responsibilities to specific groups

Clear chains of authority, delegation, communicatione.g. Banks, Colleges

2. INFORMAL

Operates alongside formal framework

More Flexible and Spontaneous

Social Groups form informally to get things done

Q. Which of the following structures in your opinion is

more efficient?


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1.2 IDENTIFY TALLORGANISATIO

NSTRUCTURESCHARACTERISED BYLARGER BUSINESS,SPECIALISATION,

DELEGATION, GREATERNUMBER OF EMPLOYEESAND EMPLOYEE TYPE

NOTE : NARROWSPAN OFCONTROL


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TALL ORGANISATIONSTRUCTURE

ADVANTAGES :

Greater Economies of Scale (bigger)

Greater Efficiency

Greater Turnover

DISADVANTAGES :

Communication Problems (Both vertical andhorizontal)

Too many levels

More informal, less friendly

Slower Decision Making

FLAT
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1.2 IDENTIFYFLATORGANISATIONAL

STRUCTURECHARACTERISED BY SMALLER BUSINESS WITH SMALLNUMBER OF EMPLOYEES, FEWER LEVELS OF AUTHORITY,WORK PASSES THROUGH A FEW HANDS NOTE: WIDE

SPAN OF CONTROL
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FLAT ORGANISATIONSTRUCTURES

ADVANTAGES ;

QUICK COMMUNICATION (VERTICAL ONLY)

TOP MANAGEMENT CLOSER TO GROUND TOENSURE PRODUCTIVITY

GREATER PERSONAL CUSTOMER ATTENTION

DISADVANTAGES :

LESS SPECIALISATION SMALLER ECONOMIES OF SCALE

LOWER TURNOVER, GROWTH CAPABILITIESRESTRICTED
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1.1 Features of Each BusinessOrganisation Type

Features/Characteristics of each.

What types of activities doOrganisations engage in?

Advantages/Disadvantages of each.
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Advantages of Sole Trader

Fast Decision making ability noconsultations needed.

Keeps all profits, no profit share.

Flexible hours, control over time.

No industrial relations issues.

Promotes customer loyalty withfriendly personal service

Suits family-run business.


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Disadvantages of SoleTrader

Unlimited Liability He/She is personallyliable for all debts and the business is nota separate legal entity.

Higher Trading costs no bulk buyingdiscounts leading to higher selling prices.

This can lead to a reduction in sales.

More Limited Sources of finance

Expertise required in all areas Administration overload may lead to tax

liabilities
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Finance for Sole Traders

Loans from financial institutions e.g.Commercial mortgage Long termBusiness Loan Medium term

Personal Savings

Hire Purchase (for equipment)

Suppliers Credit terms (30 days) Overdraft Short term

Credit Card Short term


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Now for a Video

A different perspective on Sole Traderand organisations.
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Sample Questions SoleTrader

-Outline 3 advantages and 3disadvantages of the Sole Trader

-How does Registration of Business

names act 63 apply to sole trader?

-Why are sole Traders selling priceshigher than those of a larger trader?

-Which sole traders can you identifyfrom your local area?
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Partnerships What arethey?
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A Definition

An association of two or morepartners who take part in a

common undertaking. They shareprofits and risk.
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who take part in a commonundertaking

Features of Partnerships1. Must register u Business Names Act 19632. Safety, Health and Welfare and Work Act applies

3. Accounts must be kept in order

4. Deed of Partnership drawn up or covered underagreement

5. Partnership act 1890 -equal share ofprofits/losses - no new partners without all

consent Disputes to be settled by majority Equal access to accounts/profits calculatedbefore loan interest.


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Features of Partnershipcontd.

6. Unlimited liability one may have tocover another out of private funds. Not aseparate legal entity/risky

7. Dissolution Procedure (i) Assets revaluedand sold (ii) Creditors paid (iii) Leftover P/L divided in ratio (iv) Option ofbecoming sleeping or quasi.

8. What objectives would a partnershiphave?

9. There are Four Types of Partners
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The 4 Types of Partnerships

i. Active Participates fully in the business.

ii. Sleeping Contributes capital but no dayto day input

iii. Quasi Retires and leaves money in thebusiness as a loan. Interest is paid onceprofits have been calculated.

iv. Limited Whose liability is limited toamount of capital invested.
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Advantages of Partnerships

Greater Capital and Size

Greater Specialisation and range oftalents/synergy

Division of and reduction in liability of debt

Consultative decision makingtwo heads

Privacy as accounts not published

Still able to give customer service andgain loyaltygoodwill


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Disadvantages ofPartnerships

Unlimited Liability (unless a ltd partner) sopartners may be financially liable.

Not a Separate legal entity so owners can

be sued personally Decisions maybe slower and cause

inefficiencies

Automatic Dissolution on Death(insurance)

No new partners unless full agreementcould lead to slower growth


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Sample QuestionsPartnerships

- The business is not a separate legal entity, Whatis meant by this?

- What is the purpose of the partnership act 1980?

-

Explain the difference between active, sleepingand quasi partners.

- Why would a partnership dissolve?

- Outline 3 advantages and 3 disadvantages of

partnerships?- When a partner dies what procedure follows?

- Can you identify any partnerships operating locallyin your area?


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Recap to date

Course Aims, Overview and Assesments

Completed Learning Style Questionnaire

What is an Organisation, Business,

Business Administration? Listed the different Organisation type and

Key Principles that dictate organisationtype

Identified Tall and Flat Organisationstructures

Discussed Features, Advantages,

Disadvantages of Sole Traders (Video) and


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Features of LimitedCompanies

Limited Liability Indicates that thecompany is a legal entity separatefrom the owners. Regarding debts,the company is sued, not the owners.

Legally formed Memorandum ofAssociation (General) Company name,objectives, office location signed andwitnessed.

Articles of Association (Specific) contain alist of internal rules of organisation wrtvoting rights, powers and duties ofdirectors and meeting procedures.


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Forming a Private LimitedCompany

1. Decide company name (check with CRO).

2. Complete Forms A1, Memorandum ofAssociation and Articles of Association

forms3. Draw up documents legally

4. Documents inspected by Registrar tocheck compliance with companies act1983

5. Registrar issues a Certificate ofIncorporation

6. Commence Business with limited liability
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Converting from Private toPublic

1. Must Satisfy following conditions

. Have a minimum of a quarter of theauthorised capital offered to the public.

. Have a minimum market value. Have a minimum number of

shareholders.

.

Have a good track record. Have a minimum profit level

. Accept full disclosure of its operation wrt.Salaries, Profits and Strategies


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Converting from Private toPublic contd.

2. Legal documents must be lodged with theRegistrar of joint stock companies.

3. Company makes application to the StockExchange Council through a stockbroker.

4. Stockbroker and Merchant bank inspect books toverify S/E financial requirements are met.

5. On Stock Exchange Council acceptance, theRegistrar of Companies issues a Trading Certificate.

The company can NOT commence business until this

is issued. Before shares are quoted, the companymust produce a prospectus. The prospectus is anoffer to buy to new and existing potentialshareholders i.e. the public.


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.ORGANISATION. Nearly every

organstion has 5 main functional

areas.TECHNICAL Producing, Making

COMMERCIAL Buying, Selling

FINANCIAL Getting CapitalACCOUNTING Controlling Finance

MANAGERIAL Resources, People,

Administration, Getting thingsdone.
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1.4 DEPARTMENT ROLES

TO ACHIEVE ORGANISATIONAL OBJECTIVESday to day and strategic.

Administration The organising and

running of a business or organisation Human Resources Managing people

Production Making or adding valueproducts or services

Marketing Managing products, pricing,promotion and location

S l ti


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Sample questions -Companies

1. What is the CRO?

2. Distinguish between a companylimited by guarantee and unlimitedcompany.

3. Can you identify Private LimitedCompanies operating locally?

4. How about a Public LimitedCompany?
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THE IMPACT OF SIZE ANDTYPE OF ORGANISATION

AFFECTS AND RELATES TO:

OWNERSHIP PROFIT

MANAGEMENT

ADMINISTRATION

STAFFING


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Friendly Societies

1. Industrial and Provident Societies Two DifferentSocieties Types e.g. Dairy, Meat processing,Livestock, and Public Utility e.g. Water, Housing.Most of these are Co Operative Societies.

2. Credit Unions 3. Friendly Societies

4. Certain Trade union.

The Co Operative movement was founded byRobert Owen in English town of Rochdale in1900,s. The Rochdale Principles still govern thethinking of cooperative movements.


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Rochdale Principles

1. Open Membership Anyone can join.

2. Democratic rule One vote per person.

3. Limited Return on Capital.

4. Profit distributed to number ofpurchases.

5. No Credit Cash sales only.

6. Some Profit set aside for educationalpurposes.

7. Neutral on political and religious issues.


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Features of Co-Operatives

Must registrar with Registrar of Friendly Societies.

Need 8 or more people to form.

One person one vote.

Maximum agreed number of shares owned. Shares are non-transferable and must be sold back

to coop.

Profits to be distributed in proportion to membersholdings.

To compete many have become public companiese.g. Kerry and Avonmore formed Glanbia in 1977.

Some Co Ops have retail outlets attached e.g.Thurles Cooperative Creamery ltd.
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Features of Credit Unions

Introduced in 1958 with a policy of self help.

Formed under the Credit union act 1966 and Industrial andProvident Societies act 1978.

Run by a voluntary board of directors.

Non profit making aimed at promoting savings and offeringreasonable rate loans.

Must be registered with Registrar of Friendly Societies.

One member one vote.

Loans policy vary from one to another but usually based onsavings records.

Shares cannot be withdrawn until loan is paid off.

Life Assurance cover
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Friendly Societies

Registered under the Friendly

Societies Acts. E.G. Prison Officers Medical Aid,

Kilkenny Archaeological Society

and Chinese Society of Ireland
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Trade Unions (see slide 128)

Many register as friendly societies

We will examine in more detail in unit3 however there are 3 types Craft,White Collar and General.
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Charities

Non Profit making

Exempt from VAT

Receive Donations e.g. SVdeP, Trocarie, ConcernCaring

Groups

Give Advice and Counselling e.g. AA,The Samaritans

So to Recap Organisation


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So to Recap OrganisationTypes

What are the main different business organisation types?What are thepurpose, aims and objectives of each?

Sole Trader Unincorporated body, owned by one person.E.G. Some pubs, shops, restraunts.

Partnerships Formed by Deed of partnership setting out

conditions. E.G. Solicitors, Accountants, Dentists, Architects. Private limited Companies Similar in Formation and

reporting to PLCs however no shares issued to public and nominimum share capital. Number of shareholders betweentwo and fifty. E.G. Masterfoods, Dunnes Stores

Public Limited Companies Incorporated under aMemorandum and Articles of Association. Has at least twodirectors (managers) appointed by shareholders (owners).Has statutory obligations. E.G. AIB, Glanbia
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Recap Organisations contd.

Friendly Societies organisations registered withthe Registrar of Friendly Societies e.g. CreditUnions, some Co operatives.

State Bodies Totally funded by the Governmente.g. Gardai, Army, Blood Bank. All are non trading.

Trading Semi-State Bodies Offer a service youpay for e.g. Bord na Mona, Aer Lingus, Aer RiantaBus Eireann , Irish Rail

NonTrading Semi-State Bodies - Those who

provide Advice, grants and Incentives. E.G.Residential Tenancies Board, IDA, FAS

Charities and Voluntary organisations e.g Goal,ISPCC


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1.5 ORGANISATION CHARTS

Q. Which of the following organisationsare structured

a. BY FUNCTION/DEPARTMENT

b. BY GEOGRAPHY

c. BY PRODUCT

1. Vodafone 2. Cadburys 3. A CreditUnion
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INTERNATIONALORGANISATION
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NORTH AMERICANORGANISATION

1.6 LIST ENVIORNMENTAL
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1.6 LIST ENVIORNMENTALFEATURES THAT IMPACT ON AN

ORGANISATION - PEST POLITICAL Government - Wars

Red tape

ECONOMIC Credit Crunch Unemployment Globalisation labour costs

SOCIAL Ethics Trends eg healthyoptions

TECHNOLOGICAL Onlinetrading/Internet


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SUMMARY TO DATE

1.1 We identified different types oforganisation

1.2 We looked at distinguishing features of

each organisation type 1.3 We listed the different departments in

an organisation and discussed their role.

1.4 Designed and examined organisationcharts

1.5 Discussed P.E.S.T. analysis
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