Year 12 Bus Man chapter one 1

Year 12 Business Management

Chapter One - LSOs

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Unique nature of LSOs

An organisation;Has a formal or structured arrangementHas two or more peopleHas a specific goal or purposeTakes resources and transforms them into a good or service.

Organisations can achieve things that cannot be achieved by individuals.

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Characteristics of LSOsThere is no formal definition and LSOs do not have to have all of

these characteristics.• More than 200 employees• Substantial assets (eg often more than $200m)• Substantial revenue or sales• Substantial profit• Often listed on the Stock Exchange (public company)• Large percentage or proportion of market share.• Size of operations (although can be single, multiple factories,

branches etc)• Number of business locations – often national or multinational

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Important Concepts re LSOs

Multinational/transnational corporations

Takeover

Merger

Diversification

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Different types of LSOs

OwnershipPublic sector – government owned sector of the economy. Public service which consists of government depts.Examples; Victoria Police, Department of Health. GBEs – corporatisation; run on business lines & usually profitable. Examples include; ATO, VCAA, Vicroads & Australia Post.Privatisation – process of moving from the public sector to the private sector. Can be done through; a) Share float – selling shares.b) Public tenderc) Public private partnerships eg. building schools & hospitals.

Examples include; Telstra, Metro Trains, Commonwealth Bank & Qantas.

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Private sector – owned by individuals and groups.Public companies – listed on the Stock Exchange eg. Woolworths, BHP Billiton & Wesfarmers.Private companies – have ‘Pty Ltd’ after their name. Cannot buy shares in these companies unless invited. Eg. Ripcurl & Visy.

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Focus

• Profit – private sector companies.• Not for profit – charities, foundations, trusts.

Goals and foci is community & service based. Usually they are LSOs.

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Organisational objectives & strategies

Mission Statement 1. Who we are2. What we do3. Where we are goingEg. BHP Billiton

‘Our purpose is to create long term value through the discovery, development and conversion of natural resources, and the provision of innovative customer and market-focused solutions.’

Vision StatementPhilosophical statement of the

values and what the organisation wishes to become.

EG DEECD (Education Dept)‘Every young Victorian thrives, learns and grows to enjoy a productive, rewarding and fulfilling life, while contributing to their local & global communities.’

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Organisational Objectives

Can be;

• Strategic• Tactical• Operational

Objectives of goals must be;

SMART

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Typical Management Functions

LSOs typically manage;Operations (OM, production)FinanceHuman Resources (employees)Marketing (advertising & promotion of products and services).

Research & development (innovation)

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Contributions of LSOs

•GDP•Employment•Balance of Payments (trade)•Research & innovation•Infrastructure growth

Contributions can be both positive & negative.

Eg.