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Business structure

Business structure. Meaning of Business System:.

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Business structure

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  1. Business structure

  2. Meaning of Business System: Business system is a set of all individuals, groups, organisations and resources, which are directly or indirectly connected with the production and distribution of goods & services. Business system, therefore includes, investors, financial institutions, government organisations, various types of business organisations, traders, customers, non-profit organisations like chambers of commerce; service providers like banks, etc. Com - 1 - Business Environment, Business Structure

  3. Features of Business System: • Business is a part of social system • Business interacts with social groups • Business consists of sub-systems • Varying degree of inter-dependence • Business is guided by well-defined objectives • Business & Environment Com - 1 - Business Environment, Business Structure

  4. Business Structure: Business structure refers to the established pattern of relationships among the components or parts of the business. Business structure can also be referred to a framework designed to accomplish well defined goals. Com - 1 - Business Environment, Business Structure

  5. Need & Importance of Business Structure: • Facilitates Effective Management • Growth & Development • Estimate of Resources • Optimum use of Resources • Facilitates Teamwork • Better Relations • Attainment of Objectives • Improves Efficiency • Facilitates Innovation • Enhances Corporate Image Com - 1 - Business Environment, Business Structure

  6. Components of Business Structure: Com - 1 - Business Environment, Business Structure

  7. Private sector

  8. Forms of Private Sector: • Sole Trading Concern • Partnership Firm • Joint Stock Company • Joint Hindu Family Firms • Co-operative Societies Com - 1 - Business Environment, Business Structure

  9. Role of Private Sector in India: • Employment • Contributes to National Income • Capital Formation • Social Order • Rural Development • Entrepreneurial Development • Supports Public Sector • Facilitates Economic Development • Contributes to Government’s Revenue • Facilitates Competition • Foreign Exchange Earnings Com - 1 - Business Environment, Business Structure

  10. Problems of Private Sector in India: • Government Control • Unhealthy Competition • Profit Motive • Exploitation of Workers • Problem of Industrial Sickness • Misuse of Resources • Malpractices • Monopoly & Concentration Com - 1 - Business Environment, Business Structure

  11. Public sector

  12. Forms of Public Sector Enterprises: • Departmental Form • Public Corporation • Government Company Com - 1 - Business Environment, Business Structure

  13. Role & Importance of Public Sector in India: • Employment • Rural Development • National Income • Capital Formation • Foreign Exchange Earnings • Social Order • Infrastructure Development • Reduction in Regional Disparities • Reduces Concentration of Wealth • Government Revenue Com - 1 - Business Environment, Business Structure

  14. Problems of Public Sector in India: • Low Return on Investment • Low Labour Productivity • Underutlisation of Capacities • Poor Labour-Management Relations • Wastage of Resources • Use of Outdated Technology • Lack of Professionalism • Political Interference • Surplus Staff • Other Problems Com - 1 - Business Environment, Business Structure

  15. Joint Sector

  16. Definition & Description of Joint Sector: • In the Tata Memorandum on Industrial Growth J.R.D. Tata defines; “ A Joint Sector Enterprise is intended to be a form of partnership between the private sector & the government, in which state participation in capital will not be less than 26%, the day to day management will normally be in the hands of the private sector exercised by the board of directors on which government is adequately represented.” • The history of the Joint Sector dates to pre-independence days, when several industrial enterprises were set up in the princely states of Mysore & Hyderabad with public participation in Equity. • The Companies in the Joint Sector were promoted for the purpose of industrial growth & not for controlling & restricting monopoly & concentration of wealth & income. Com - 1 - Business Environment, Business Structure

  17. Role of Joint Sector: • Acceleration of Industrial Growth • Regional Development • Improvement in Managerial Efficiency • Solves the Shortcomings of Private & Public Sector • Broad-basing Entrepreneurship • Social Control over Industries • Capital Formation • Employment Com - 1 - Business Environment, Business Structure

  18. Problems of Joint Sector: • Interference by Government • Procedure & Formalities • Problem of Board of Directors • Problem of Social Objectives • Problem of Low Returns • Underutilisation of Capacities Com - 1 - Business Environment, Business Structure

  19. Taruna R. Shroff Thank you Com - 1 - Business Environment, Business Structure

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