Key issues faced in organisation and behaviour

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Sole traders: Individual small organisations such as corner shops or window cleaners. Here the manager is the owner and accepts full responsibility for the liabilities of the organisation.

Partnerships: Usually found in such professions as architects, veterinary surgeons and accountants. Here liability can be shared equally amongst the partners or, more commonly, each partner can be responsible for all the liability of the organisation.

Private limited companies (Ltd): Small privately owned companies wherein the liability is limited to the private owners of the organisation. These are usually to be found as local builders, pubs, restaurants and so-called SMEs (Small and Medium sized Enterprises)

Public limited companies (PLC): These are usually large or very large organisations whose shares are quoted publicly on stock exchanges. That is they are publicly owned. For, unlike Private Limited Companies, it is the anonymous shareholders who bear the liabilities of the organisation.


Consumer co-operatives: These have a different structure whereby they are owned by their customers, profits are returned in the form of dividends or discounts to members.

Producer co-operatives: Where producers form an alliance when suppliers feel by pooling resources they can sell output more effectively. An example of this type is Milk Marquee, where milk producers formed a co-operative to market milk in the UK.

Franchises: These are organisations, which buy the right to sell other organisations products. The parent organisation brands, advertises, supplies the products which the franchise organisation sells. Examples of these are Benetton, Wimpey and The Body Shop. The franchisee will likely be a sole trader or a private limited company.

The organisation I have decided to write about for my assignment is on WH Smith. I have chosen to write about W H Smith because it is one of my all-time favourite stationers and newsagent. I remember I would go there at a very young age and buy a big pack of felt tip pens, still after many years have past I still decide to go to W H Smith. I've always choose to go to W H Smith because I highly recommend superb service and quality long-lasting products. So whether it's for a writing pen or just a bar of chocolate, think, W H Smith!


W H Smith Mission, Objectives and Responsibilities

The major objective of WH smith is customer satisfaction; they have it in them to become the next wonder in Britain's retail world . W H Smith has also engaged in business outside the United Kingdom. This includes Canada, Singapore, Australia, New Zealand, and Hong Kong, The Company also retains one shop in the centre of Paris, France.


WH Smith has clearly taken into account their support towards a eco friendly culture. They understand that through becoming eco friendly they can not only save the environment but also boost their goodwill.

W H Smith wants to keep things simple, transparent, customer oriented. The most important aspects for which WH Smith is known for are:

1. Customer Focus -keep the customer at the heart of all that they do

2. Drive for Results -act with tenacity to deliver ambitious and competitive results

3. Accountability - takes responsibility and delivers what they say

4. Value our People - people are respected and valued in an honest, open environment

1b W H Smith Stakeholder Map

Stakeholders of WH Smith can be anyone who has a direct or indirect contact with the organization. It includes customers (obviously), shareholders who does the funding, management, suppliers etc.


Provide financial reports that are accurate and timely.

Communicate honestly to all concerned our policies, achievements, risks and prospects.

Work at all times to comply with the provisions of the Stock Exchange Listing Rules and aim to comply with corporate governance best practice.


The Company values its employees highly.

Respect the dignity and rights of all employees.

Provide healthy and safe work environments.

Encourage employees to report any suspicions of fraud or undesirable practice and introduce a process to facilitate this.


The Company's customers are of paramount importance.

Seek to be honest and fair in our dealings with customers.

Provide the quality and standard of service that customers have a right to expect.

Treat all customer complaints seriously and provide a readily accessible source of advice and guidance regarding all products and services.

Suppliers & Business Partners

The Company's relations with its suppliers are based on mutual trust and respect.

Seek to be honest and fair with suppliers.

Pay suppliers in accordance with agreed terms.

Respect any confidential information.

Encourage the suppliers and business partners to at least meet the same standards of business conduct as those outlined in this Code.

Community & Environment

The Company seeks to be a good corporate citizen, respecting the laws of the countries in which they operate and contributing to the communities in which they operate.

Aim to make the communities in which the community work better places to live and do business.

Seek to be sensitive to the local community's culture and social and economic needs.


The WH Smith Trust is a registered charity (registered charity no. 1013782) with two principal objectives:

To support the local communities in which WH Smith staff and customers live and work

To support education and lifelong learning, helping people of any age to achieve their educational potential.


Board of Trustees

The WHSmith Trust is managed by a board of trustees, which is made up of members of staff from across the WHSmith Group. The trustees meet every two months to determine overall policy, review Trust activity and resources and consider grant applications. The Trust's administrative costs are met by WHSmith plc. In meeting its commitment to the Trust, WHSmith plc provides:

All staff costs plus related office and administration overheads.

Considerable support from Group Communications on the marketing and promotion of activities.

Each trustee has responsibility for encouraging the full involvement and support of their individual business in the activities of the Trust. All trustees undertake the role in a voluntary capacity and have a genuine interest in the voluntary sector.

The Staff are great ambassadors for the Company and the WHSmith Trust is known to provide grants to support the excellent voluntary efforts of WHSmith staff in the communities in which they operate. Many members of staff are involved in their community on a personal basis and a large number of stores are involved collectively as a team while others may see this as an opportunity to really get behind a local cause.

Grants will only be made to registered charities with which a WHSmith employee has direct involvement.

The trustees will only consider one grant request per employee per year.

The Trust will match employee fundraising up to £500.

Grants for larger sums will be subject to the trustees' discretion.

Grants to support education and lifelong learning

The WHSmith Trust will make grants of up to £60,000 to UK-based projects which support education, literacy or life-long learning.

Projects may operate on a regional or a national level.

There is no requirement for WHSmith employees to have existing involvement with the project/charity.

The Trust favours projects where it will be a major funder, providing at least 30% of funding.

The project should deliver clear outputs, which can be communicated to WHSmith employees and customers.

Supporting employee volunteering - Volunteers in Schools

The Trust's 'Volunteers in Schools' scheme aims to support members of staff who are regularly involved as representatives on either a school's governing body, or Parent Teacher Association.WHSmith employees can apply for a grant if they work for any part of WHSmith in the UK on a permanent contract, and regularly volunteer for a minimum of 4 hours per month in the activities of a local school.

There are two fixed level grants:

£250 - for employees involved in a support group (ie PTA, League of Friends) or general fundraising

£500 - for employees involved in the management of the school (ie governor, treasurer etc.)

Supporting employee volunteering - Community challenges

The WHSmith Trust encourages staffs and employees to take part in charity works for benefiting the local community. It can really help build the goodwill of WH Smith.

Supporting employee volunteering - Marathons

The WHSmith Charitable Trust reserves a number of places each year for the London Marathon and the Great North Run. Places are available to WH Smith staffs that are raising money for the Trust. More details are communicated to employees in the months before each race.

3a Mixed Economy

This type of economy is the one that is identified with the so-called western economies. This is sometimes called a "first world economy". The division of the world's economies in this way was by observation of the global political and economic interrelationships.

(Rdi material)

Mixed economy is a great example of modern business policies where the government would have a hold on market prices and services. This really prevents big price variances(inflation or deflation).

Advantages of a mixed economy

Increasing national production in the country.

Both public and private sectors work hard.

Relationships between countries become stronger.

Free competition grows

Prohibition of illegal productions is quite common

The problems created by free enterprise and too much public control are solved through mixed economy.

Provides freedom of enterprise ownership and profit earning as well as social welfare and political freedom.

All the national recourses are utilized under mixed economy.

Disadvantages of mixed economy

Market can't work properly due to government interfering.

Not helpful in achieving optimal use of national resources.

Suffers from the drawbacks of both the capitalism and the socialism.

Mixed economy seldom achieved progress.

Suffers from continues back wardness. Under mixed economy wastage of different types occurs in the economy.

For example, India has followed a mixed economic pattern since independence. Both public and private sectors coexist. The state's planning machinery plays a significant role in allocating resources across various sectors.

3b Economic cycle

There are three identifiable types of economy in which organisations operate: Local, National and International. The geographical reach and its market size can be the two terms that determine an economy . Local can mean a town, a region or regions, whereas national confines itself to its recognised governmental boundaries. International straddles the entire globe.

A planned economy or directed economic system in which the government or council workers manage the economy.

However free market is not controlled by the government much and people are sell anything or buy any product at any time.

Predictable long-term pattern changes in national income. Business cycle consists of 4 stages:

1. Recovery

2. Boom

3. Depression

4. Recession


Inflation: The rate at which the prices of goods and other essential commodities are increasing every year There are two principal criteria for distinguishing a depression from a recession: a decline in real GDP that exceeds 10%, or one that lasts more than three years.


Price intervention can be the minimum price which is promised by a government on an agricultural product. But when the actual prices tend to go below this price which is set by the government, the government must buy the product at this price. The intervention price is usually a percentage of the target price: the price hoped for in the open market..

Mergers & acquisitions (M&A) refers to the management, financing, and strategy involved with buying, selling, and combining companies.

Growth in international trade has been on the rise since industrialisation. It has assumed new dimensions with globalisation. As economies have become more open through globalisation, the degree of interdependence between countries has increased.

Global markets provide great opportunities for businesses in Western countries. Indeed, many UK companies are focusing on global markets rather than the home market, because of the potential for larger rewards and growth.

Mergers are usually two organisations agreeing to come together, take-overs are usually hostile absorption of one company by another. This occurs where one company sees a strategic advantage in taking over a competitor, either to widen its own market share or to remove the competition or both. A merger is an agreement by two companies to run their two businesses as one. This is a very common practice. For example, Rank Hovis and McDougal were separate and independent companies now they are one with some seemingly very diverse businesses.

Launching and operating a business in emerging markets has its particular challenges. As we have already noted that foreign mergers and acquisitions are viewed as fast track paths to global expansion. Now over 50% of all mergers in the US, EU and Asia are cross-border; precisely with the objective of fast market entry into important global markets.

By mergers and acquisitions, corporations seek to create economic value through economies of scale, economies of scope, access to global markets, improved target management, tax benefits, or the availability of low cost financing for financially constrained targets.

Despite the phenomenal increase in mergers and acquisitions activities, a large proportion of mergers and acquisitions fail - particularly in the emerging markets. One of the issues is that management in Western countries frequently underestimate the issues relating to inadequate infrastructure, poor communications, language and cultural barriers. However, there is a more fundamental issue relating to the actual valuation of companies in emerging markets.

The Three Pillars European Union


A merger is the combination of two similarly sized companies combined to form a new company. An acquisition occurs when one company clearly purchases another and becomes the new owner. A merger or an acquisition usually starts out with a series of informal discussions between the boards of the companies, followed by formal negotiations, a letter of intent, due diligence, a purchase or merger agreement, and finally, the execution of the deal and the transfer of payment.

Mergers can help firms deal with the threat of multinationals and compete on an international scale. The desirability of a merger will depend upon several factors such as:

1. Is there scope for economies of scale?

2. Will there be an increase in monopoly power and significant reduction in competition?

3. Is the market still contestable (freedom of entry and exit?)