Types of organisations and stakeholders within the business environment

organisation types

public

The public sector includes any organisation that is owned and operated by government agencies. Although it could be argued that these organisations provide a service. They are not classified in the same category as the tertiary sector that provides services such as banks, supermarkets, cinemas, and hairdressers.

Private

Private sector organisations are owned by individuals and are driven by making a profit. This profit benefits the owners of the organisation their shareholders and investors. Private sector organisations are usually financed by money from shareholders and bank loans. These are some categories that fall within the private sector.

Small or medium enterprises - Businesses with a financial turnover asset and/or the number of employees is below a certain level are classified as small or medium sized enterprises. The criteria for determining whether a business is a SME varies between countries and in some instances between industries.

Large enterprises - This type of business has a more comprehensive business model that will often have full time staff who manage the applications and parts of the IT infrastructure. In addition, they exceed the number of employees, financial turnover and assets that are the benchmark for SME’s.

Non-governmental organisations - These are non-profit organisations that function independently off the government. They are sometimes referred to as civic societies and are organised at local, community, national and international levels to serve a social or political goal, such as causes for the environment or humanitarian reasons. Some NGOs rely on volunteers as their workforce, while others have paid staff. These are the two groups of NGOs.

• Operational - NGO's focus on the design and implementation of development projects
• Advocacy - These NGOs promote and defend a specific cause and seek to influence public policy.

NGOs rely on funding from services such as

• Membership fees
• Sales of goods and services.
• Private donations
• Grants

voluntary/charity

These are organisations whose purpose is to benefit society, often without profits, as a motive and with little or no government intervention at all. Any money raised or earned by these organisations is usually invested back into the community or the organisation itself. Charity is registered with the Charity Commission, to be registered with this a charity must be.

• Established for charitable purpose.
• Subject to the high court charity law jurisdiction

Charities eligible for various tax exemptions as they do not pay tax on income. From donations or rental of premises.

Not-for-profit - People often confuse not for profits with charities. Not for profits means that the organisation activities are not for the financial benefit of any individual or board of directors. The benefit of being a not-for-profit organisation is that there are fewer restrictions on the types of charitable work they can carry out and they are not under the same restrictions as those registered with the Charity Commission.

Stakeholder types

A stakeholder is someone who has an interest in the business and who can either affect or be affected by the business's operation and performance. Stakeholders can be internal or external to a business.

Internal

Owners - The owners can be the same people who direct the business and have control over the day-to-day operations and processes, or they may employ a manager to carry out that role for them, or even a board of directors.

Board of directors - These are elected to represent the stakeholder's interests. Every public company must have a board of directors that consist of members who are internal and external to the business. They make decisions about be employing and sacking of personnel, dividend policies and pay outs and executive compensation.

Employees - These are people who have an employment contract. All employees are classified as workers and have additional employment rights and responsibilities that do not apply to people who are workers but not employees. Some rights are only available after an employee has worked for the business over a set period.

Departments - These are parts of a larger business/organisation/company, and they are organised around their separate roles.

External

External stakeholders do not have direct relationship with the business. An external stakeholder is normally a person or company that is affected by the operations of the business.

Customers and consumers - Customers are people or organisations who buy, pay for, or recommend products and services. A customer will pay for a product and service, but not necessarily be the person who consumes it.

Clients - The client is a person or company that pays for professional support or services for another company. Clients have an interest in the quality and availability of the services provided by a business.

Direct and indirect competitors - Every business can directly or indirectly affect the performance of its competitors. Direct competitors are competitors sell comparable products and services as another business. Whereas Indirect Competitors also sell similar products and services in the same sector as another business, but they are sufficiently different in that they can act as a substitute for the product or service that a company is selling.

Outsourced services and suppliers - Outsourcing is when a business hires other businesses to carry out tasks, handle operational activities or provide services on its behalf. They can also influence a business's operation through the prices they charge, the products or services they provide, changes to delivery times, changes to the quality of their product/services and changes to any credit agreements.

Shareholders - A shareholder is a person, institution, or company that owns at least one share of a company's stock. They are subject to capital gains/losses or dividend payments on a business's profit. Shareholders also have the right to vote at shareholder meetings to approve.

Investors - These are people, companies or other entities that provide funds with the exception that they will get more money back than they invested. Investors may provide loans buy shares or act as guarantors.

Funders - These are wealthy organisations or individuals that provide financial backing for projects and business ventures. They offer financial support through a grant, an investment or loan.

Government - Government operates on local, national, and international levels.

Local - Local authorities should have a strategy in place that enables them to understand the changing demands of their local communities, habits and demands. This means that they can support local businesses in adapting and creating new business opportunities.

National - National government is made-up of politicians who run the country for the benefit of the population. One of their roles is to encourage businesses to invest and create jobs. The laws they introduce can have a negative or positive impact on businesses and may cause businesses to invest in other areas or even countries. Governments have an interest in businesses performing well, so they can.

• Provide goods and services for the entire country.
• Create jobs and improve the wealth of the country's population.
• Pay corporate tax.

They can influence the operating of a business by.

• Offering grants to encourage businesses to move to depressed areas where employment prospects and welfare low.
• Introducing or repealing laws that have an impact on businesses.
• Increasing or decreasing the amount of corporation tax that businesses must

International - International government is where the governments of different countries come together and set out regulation and legislation in connection with trade agreements between countries, the environment, import regulations and so on.

Business environments

Business to customer - This is where businesses sell products and services directly to customers.

Business to business - These are businesses that sell products and/or services to other businesses for them to function. They provide raw materials, finished parts/products and consultancy that other businesses need 

Business to many - These are businesses that sells their products and services to other businesses and customers.