Size and scope of different types of organisations
This article explores the size and scope of different types of organisations. It goes without saying that there are many types of organisations with different scope and size in any industry. The size and scope of an organisation depend on various factors such as its purpose, management structure, operational methods, funding sources, services offered etc. These parameters can define how small or big the organisation is.
Small business organisations
A small business organisation generally operates on a small scale with a limited number of people involved in the operations. It can be a start-up organisation or an existing one with a small scope and limited resources. It can be a sole proprietorship, partnership, or a limited company depending on the type of business it operates in.
According to OECD (2022) a small business usually has 10 to 49 employees. Any organisation having less than 10 employees is called a micro enterprise. There are millions of small businesses around the world which immensely contribute to the global GDP. These organisations are found virtually in all industries.
Medium sized organisations
A medium sized organisation can be either a start-up organisation or an existing organisation that has a moderate scope of operations and resources. A moderate scope of operations can be in the field of manufacturing, service provision, or social work that may require a moderate amount of capital and employees. According to OECD (2022) a medium sized organisation usually has 50 and 249 employees.
A large organisation is an organisation that has a large scope of operation and resources. It may be in the business of manufacturing a particular product or providing a specific type of service or it may operate in the field of social work for a large section of the society. According to OECD (2022) a large organisation employs 250 or more people.
According to CNN (2021) the 20 largest organisations in the world are Wal-Mart Stores, China National Petroleum, State Grid, Sinopec Group, Hon Hai Precision Industry, China Post Group, U.S. Postal Service, Volkswagen, China Telecommunications, Aviation Industry Corp. of China, Compass Group, Agricultural Bank of China, International Business Machines, Deutsche Post, McDonald’s, Carrefour, Industrial & Commercial Bank of China, Tesco , Gazprom, and Sodexo.
Private sector organisations
Private sector organisations are owned by individuals (BBC, 2022). These are profit-making organisations. Profits given to the owners, shareholders, and investors are called ‘dividends’. These organisations are usually financed by private money from shareholders and by bank loans.
Public sector organisations (Government Organisations)
Public sector organisations are owned by the government (BBC, 2022). They are created by the government to carry out specific operations required by the society. The operations of these organisations can be varied such as social work, research and development, harvesting resources etc. An example of a government organisation is a research organisation that is created by the government to carry out research in various fields such as medical research, agriculture research, space research, social research etc.
Professional organisations are formed by professionals in a specific field of work such as accountants, doctors, lawyers, engineers etc. These organisations can be formed at the national or at the local level. They can operate in specific areas or across the country. An example of a professional organisation is an accounting organisation that is formed by chartered accountants for providing accounting services to various types of businesses.
Some of the top professional bodies in the UK are Royal College of Nursing (RCN), Association of Chartered Certified Accountants (ACCA), Institution of Engineering and Technology (IET), British Medical Association (BMA), Chartered Institute of Personnel and Development (CIPD), Institute of Chartered Accountants of England and Wales (ICAEW), Association of Accounting Technicians (AAT), The Law Society, Royal Institution of Chartered Surveyors (RICS), Institution of Mechanical Engineers (IMechE), Chartered Institute of Marketing, and Chartered Institute of Personnel and development.
These are the organisations that do not earn any revenue or profit from their operations. They operate in the fields of social work, research, education, and healthcare services. An example of an NPO is a medical research organisation that is formed by experts to study and deal with health issues and related problems. More examples of NPOs include but not limited to charities, foundations, trusts, climate change organisations etc.
Summary of Size and scope of different types of organisations
To conclude, it can be said that the size and scope of any organisation depends on various factors such as its purpose, management structure, operational methods, funding sources, services offered etc. These parameters can define how small or big an organisation is. It is important for employees to understand the type of organisation they are working for. Knowing the size and scope of the organisation can help them better understand the organisation and its functioning. It can also help entrepreneurs identify the strengths and weaknesses of their proposed business.
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Last update: 19 October 2022
BBC (2022) Types of business organisations, available at: https://www.bbc.co.uk/bitesize/guides/zpx7gdm/revision/1# (accessed 17 October 2022)
CNN (2021) Top companies: biggest employers, available at: https://money.cnn.com/magazines/fortune/global500/2012/performers/companies/biggest/ (accessed 18 October 2022)
OECD (2022) Enterprises by business size, available at: https://data.oecd.org/entrepreneur/enterprises-by-business-size.htm (accessed 19 October 2022)
Author: Joe David
Joe David has years of teaching experience both in the UK and abroad. He writes regularly online on a variety of topics. He has a keen interest in business, hospitality, and tourism management. He holds a Postgraduate Diploma in Management Studies and a Post Graduate Diploma in Marketing Management.