Types of organizations

Organizations consist of several factors such as functions, people, resources, etc. Differing organisational goals and objectives implies a varying degree of importance on each of these factors, that eventually give rise to different types and structures of organizations.

Daft, Murphy and Willmott (2010) identify and discuss the differences between small and large organizations and for-profit and non-profit organizations. These organizations differ not only in terms of their main objective of existence, but also have divergent structures.

Moreover, organizations can also be classified based on ownership. These include Sole Proprietorship, Partnership, Joint Hindu Family Business (JHFB), Limited Liability Company and Corporation (NCERT, 2013).

Types of organisations (Mullins and Christy, 2013:84)

• Private enterprise organisations: are owned and financed by individuals, partners, or shareholders in a joint stock company, and are accountable to their owners or members.
• Public enterprise organisations: are created by government and include, for example, municipal undertakings and central government departments, which do not have profit as their goals.
• Third sector organisations: organisations that are not-for-profit and non-governmental, in contrast to the private and public sectors.

Different Types of Organizations

Sole traders: are people who run a one-man or a one-woman band. They handle all aspects of the organisation and are responsible to only themselves. Often, these people work from home. They are personally responsible for the debts they incur. Technically, these people are not managers: they are not usually responsible for the work of others, unless their trade is organising events and other people.

A franchise: is an arrangement between the owner of a product or service and a franchisee who owns the limited rights to make or sell it. The product is usually unique or has a strong brand image. The franchisee is relieved of the risk of developing and marketing a product, and often benefits from advice and supervision.

Owner-managers: an organisation that employs other people.

Partnerships: involve two or more people who jointly act as owners-managers. The key aspect of this organisation is the personal and unrestricted liability of each partner for the debts and obligations of the firm.

Private companies: owned by a small number of shareholders and the shares are not traded to the public. They have the advantage that they are not required to make stringent disclosures of financial information.

Public limited companies: are owned by thousands of stakeholders and the shares are traded to the public. In order to protect the public these organisations are required to submit detailed, stringent accounts.

Holding companies: are organisations that own a number of other companies. Often they have assets of many billions of pounds or dollars but they employ only a small number of people –most of the work is performed by the employees of subsidiary organisations.

Multinational corporations: are organisations that maintain significant, simultaneous operations in several countries but are based in one home company.

Virtual companies: a new kind of organisation. They occur when the various departments or components of an organisation are physically divided and separated by distances of miles.

Co-operatives: a legal entity that is owned and controlled by those who work for it or use it.

Charities: organisations set up to provide help, money and support to people and things in need.

Trade associations and professional bodies: are organisations that seek to protect and foster the interest of certain occupational groups and companies.

Public enterprises: are organisations created by statute to govern nationalized businesses.

A quango: is a quasi-autonomous non-governmental organisation. They are semi-public administrative bodies which are set up by a government to achieve a ‘public good’.