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Business and Organisations

Let’s think about the concept of ‘organisation’. Many definitions are possible, but most of these include the characteristics of people, goals and structures. People are social beings and, by and large, tend to cooperate in interdependent relationships to achieve common aims. Originally people formed a simple family and tribal structures. Today we have evolved into a complex society characterised by large, formal and increasingly global structures. For our purposes, then, we can define an organisation as a social entity that provides the necessary structures to achieve specific aims. Now take a look in several dictionaries to find variations in the way the term ‘business’ is defined, and be sure to add all your definitions from this section to your glossary.

A further point to consider is whether organisations that do not aim to make a profit, e.g. in the voluntary sector, including charities, are included in a discussion of businesses. From your investigation do you think that they should be included? Are organisations that do not aim to make a profit (e.g. charities) also business organisations? For our purposes in this subject guide, we will understand the term business to mean: a commercial enterprise or establishment that trades in goods or services

However, the complication of using a general definition emerges again. For instance, the objective of ‘trading’ does not have to be for profit. Therefore the argument can be made that non-profit making organisations can also be regarded as businesses, at least a certain type of business. This would include public sector organisations, since there is increasing demand for these organisations to perform and be managed like profit-making businesses (see Mullins, 2010, pp.82–83, ‘Private and public organisations’ and pp.435–36, ‘Management in private enterprise and public sector organisations’ for further debate on this). Pulling together aspects of different definitions, we can again devise a meaning to suit our needs. Therefore we can define the business organisation as an entity that is both commercial and social, which provides the necessary structures to achieve the central objective of trades in goods or services.

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