The structure of the business Essay Example for Free

The structure of the business Essay As you can see from the organisational chart above, Venetian Ices LTD is a respectful size. As from the diagram above it is obvious that there is a large span of control and a reasonable chain of command, this means that communication is very accurate as there is less levels for messages to pass through before the message finally reaches the desired person. Managers are also at an advantage as they are less remote from the lower level of hierarchy, these managers as a result are more in touch with subordinates as there are less managers. Also as there is a small chain of command and a large span of control, managers have more responsibilities, this may at first seem as a disadvantage but after consideration, it is obvious that under the circumstances more delegation will occur meaning subordinates will have more to do. As a result of this employees will come more motivated as there is more of a responsibility handed to them. However a foremost disadvantage is that as managers have a wider range of control, then they may lose control of what their many subordinates are doing. In most businesses there are 4 main functions- Marketing, Production, Finance and Personnel. The production function which I am concerned with throughout this course work, is in charge of ordering the raw materials in which the business produces its product, this is vital as with-out the raw materials then the business would not be able to process the product or in other words, without the raw material Venetian Ices LTD would not be able to produce their ice cream and therefore will be unable to make a profit. The department is also in charge of designing the product along side the marketing section, the two sections try to work together to provide the best product available. This section of production also works together with the finance department in case of damaged machinery of any new material the business has to purchase, if there are any problems then the production manager would provide listings of new investments needed. The production department also have to work within laws of production, in order to make sure that when they produce their product they are abiding different laws which surround the business. This is an aspect of my course work which I have to research into, as I have to reveal to the Venetian Ices LTD directors which laws they have to abide by to produce ice cream. There are three main methods of production, job production, batch production and flow production. Job production is where products are made specifically to order, for example a tailor would make a new suit to match the consumer needs. In this method each order is different, and may or may not be repeated in the same way. Other examples specialist machinery manufacturers who would manufacture a machine for another business to meet particular specification. In this method the costumer is allowed to choose the exact requirements they wish to acquire, which is a distinct advantage. Also workers will proceed to become more motivated, as they get more job satisfaction because employees are not repeating there job over and over again, but instead are doing new requirements every time a new order occurs. However skilled labour is often needed, as employees have to be able to meet incalculable costumer requirements. This is not a method used by Venetian Ices LTD as they make many ice cream products for different supermarkets. One product for each market would not recoup enough profit nor meet supply and demand. Another production method is batch production, this is where similar products are made in blocks or batches. A certain number of another product is made, then another product is made and so on. Examples include when a baker makes one type of bread and then when that order is completed another design of bread is commences. Another example is that when a house design is made acceptable in a certain development area, that design is used several times and after that design is refined with, a new batch of houses is designed. This design is particularly useful as design transformations are easy to complete and progress. Furthermore motivation towards employees is also taken into account as they are not constantly completing the same procedure, but however there is more a variety in job production. For small businesses, this method would bring them to a disadvantage as raw material stock would need to be stored and warehouse space can often consume profits. This method may be used by Venetian Ices LTD in order to see if a new flavour or design fits in well with costumer needs and wants. By only producing a few amounts of their new products they will be able to test their product on the market without risking high values of cash. The last production method is the most continuous, the method is called Flow production. This method is often referred as mass production due to the heavy quantity of products being produced. The basic ingredients of the product are put together at separate levels as the pass different sectors of a production line. I.e. as each component moves along the production belt, another piece is added to the overall product. Large product quantities are made within this method and as a result of purchasing economies the business may buy materials below the average price of that certain material. By taking advantage of purchasing economies, the business can buy in bulk fore a much lower price, by buying each unit at a cheaper price it gives the business a greater benefit against smaller companies who may not buy in the same bulk amounts, as a result it enables the business to sell its product at a much less price, making their product more favourable in the eyes of the public. However research suggest that workers are hard to motivate under these circumstances, for the work is often boring and then same day in and day out. Another essential disadvantage is that high amounts of capital is needed to set up flow production machinery, which may discourage the directors of a business to venture in to this production method. The production function has to also choose the location of manufacturing for it is vital that the right selection of location is chosen. Shown below is a diagram of factors affecting the choice of location: Probably one of the most complicated sections is the finance department that is managed by John Hardy. This function has to be in charge of controlling financial transactions within all the business. It controls the transaction by budgeting and analysing a series of accounts, the analysation occurs is through many different accounts such as cash flow forecast, profit and loss accounts etc This function is important in the sale of a new product as without tracing the sales of a new product then there would be no record of increases or decreases, resulting in a risk of a business losing profit. Probably an extremely important aspect of this function is through the finance department making budgets in which the company has to cope with. It is vital that the company deals within a budget as without a budget, the company may over spend and come drowned in dept. This may leave the future of the company in doubt. The final section is the personnel department, this department deals with the employees, meaning it controls interviews with new employees, selecting staff for promotion, discipline within the company and who will receive bonuses for working well. As well as these responsibilities the function has the more important job of making sure the company workers are well motivated. They do this in many ways, a few of which are giving job perks company car, holidays, special bonuses and personnel problems in which the employees have to deal with. If however a vacancy occurs within a business, then it is the personnel departments responsibility to attract and recruit the most suitable and most qualified staff. If the recruitment process is not completed to the highest degree, then the company could be face with members of staff who are in capable of doing the job that they were employed to do. Also the personnel department is faced with the difficult job of the dismissal and redundancy making of staff. The reason why some members of staff may be faced with dismissal maybe because the company feel that that certain member of staff is not performing to the complete standards that they wished that member would work at. Or a member may be of a certain old age, where the company feel that that staff member is coming to an end of their career. Management responsibilities in different departments Human resources department *Forecasting staff needs for the business * Preparing job descriptions and job specifications * Planning staff training courses * Interviewing and selecting staff * Keeping staff records * Disciplining staff * Recruiting staff * Preparing job descriptions and job specifications * Planning staff training courses * Interviewing and selecting staff * Keeping staff records *Disciplining staff Marketing department * Market research * Planning new products * Keeping and extracting sales records * Deciding upon the best marketing mix strategy Finance department * Recording all financial transactions * Collecting and presenting financial data * Analysing the profitability of new investment projects * Keeping cashflow control * Preparing budgets for the business Production department * Ordering stock and materials * Developing and designing new products * Locating buildings in the most cost effective areas * Designing on production methods * Controlling production to ensure high levels of efficiency * Maintaining machinery * Making sure quality of products is of standard