For Profit and Non Profit Business Analysis PDF

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Royal Dutch Shell vs Cancer Research UK (For profit and non-profit organisations). Features contrasting to the success of contrasting businesses. How are businesses influenced by stakeholders? Organization structures, aims and objectives of two contrasting companies. How internal and external stakeh...

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Unit 1 Assignment 1 P1. Features contrasting to the success of contrasting businesses

Royal Dutch Shell [ CITATION Wik18 \l 2057 ] States that Shell is an oil and gas company headquartered in the Netherlands and incorporated in the United Kingdom, it is a public limited company and is the sixthlargest company in the world (2016) meaning the company is successful in its business and has got many profits and turnovers. It was formed in 1907, the company entered the chemicals industry in 1929 and in 1970 acquired the mining company Billiton which was alter sold in 1994. Shell has around 92,000 employees which was registered in 2017, therefore it’s a large business. It also stated that their annual revenue was $305.1 billion in the same year, and their total assets value was $407 billion. This denotes the company is made for profit. The company produces:     

Petroleum Natural gas Liquefied natural gas Lubricants Petrochemicals

The petroleum is then broken down for the use of fuels for personal vehicles. The organisation, extracts, process and refines oil and gas. It also sells the products; therefore, the company overlaps from Primary to Secondary and Tertiary business sectors. Shell has 44,000 service stations around the globe, spread around 70 countries and making 3.7 million barrels of oil equivalent daily, meaning it would need many employees to run the business, and as stated above the organisation has over 92,000 workers which proves that the company is successful.

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Unit 1 Assignment 1

Cancer Research UK [ CITATION Wik181 \l 2057 ] Cancer research UK is a charity which was formed to help research the cure of cancer and raise awareness. It was formed on 4th of February 2002 by the cancer research campaign and the Imperial Cancer Research Fund (Founded in 1902). Its aim is to reduce the number of deaths from cancer by following the objectives set by the organisation. It conducts research into the;   

Prevention Diagnosis Treatment of the disease

The charity is part of the tertiary sector as it provides service to anyone in need of help or treatment involving cancer. Their services are spread around the UK which is obvious and could be easily understood by the name Cancer Research ‘UK’. The activities which help the research are allocated in institutes, universities and hospitals in the UK, this is carried out by the charity’s paid employees and self-volunteering researches. The charity runs campaigns aimed at raising awareness of the disease and influencing the public, while providing information about cancer which is one of the examples of their objectives. This helps the company raise awareness around the UK, which could possibly prevent as much deaths caused by the disease. The organisation funded mostly by the public. The most common way of raising money for the research is through donations, legacies, community fundraising which is run by the charity itself and volunteers who is willing to help the organisation, events, and retail. The charity is also funded by corporate partnerships, the main businesses are;    

Nivea Sun ScottishPower Tesco TK Maxx

Over 40,000 are regular volunteers, and it’s stated that the company lets volunteer to create fundraising, such as schools, sports and other events which could allow them to raise money for the charity’s goal. Citizens also have the option to donate and help the organisation. (Wikipedia, 2018, https://en.wikipedia.org/wiki/Cancer_Research_UK - Accessed 12th September 2018) (Wikipedia, 2018, https://en.wikipedia.org/wiki/Royal_Dutch_Shell - Accessed 12th September)

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Unit 1 Assignment 1 P2. How are businesses influenced by stakeholders?

Royal Dutch Shell Royal Dutch Shell has several influencing external and internal stakeholders which affect how the business runs.

Stakeholders [CITATION Bus18 \l 2057 ] Internal – Seen by the public as representatives of the business. These consist of shareholders, employees and suppliers. Shareholders own the company, shareholders are individuals who own a part in the business. They provide some of the capital required to set up the company and get some money of the profits, this depends accordingly to the amount of shares they own. Shareholders are crucial in Shell’s business as they are able to vote and decide the future of the business, the power of each vote depends on the percentage of shares owned by the individual or company. The shareholders choose a “Board of Directors” to represent them. This is used in a long-term plan which is called a strategy, which the directors are responsible for and are expected to administrate the plan. The directors also need to produce a report each year so that the shareholders are able to view it at an “Annual General Meeting of shareholders”. Employees are a big section of the internal stakeholders as they play an important role in the business. Shell employs over 100,000 people worldwide. The main ones consists of:       

Managers (Specialised in Finance, Marketing sales, oil and gas exploration) Geologists Market researchers Site engineers Oil platform workers Office administrators Business analysts

And many more employees for other specific jobs which keeps the company up and running. Of course there are different hierarchy in the employment, some have more power than other workers, this also affects their wage and amount of work they are expected to do. Workers should also agree with the terms and conditions of the company and respect the rules, which also links to the commitment of health and safety so that there is no risks and negative factors of the work environment. This would have either a negative or a positive impact on the company’s reputation and livelihood of other employees. Suppliers are in a partnership with Shell for the production of fuels and other items. An example would be suppliers bring petrol from the oil well to the petrol pump. The organisation has a number of core values that are central to everything it does. Linking back to the reputation of Shell, the core values are reflected by the actions of the business and could affect the future of the organisation. Shell decides which contractors and partners in the supply chain they work with, which is assessed by their demonstrated values. External – help the organisation to gain profit from the business. [ CITATION Bus18 \l 2057 ] Customers – Shell’s aim is to provide products and services in a fair price to develop customers and maintain a better reputation and popularity which again lets the company earn a higher percentage of profitability. The company is in a competition with other organisation 3|Page

Unit 1 Assignment 1 which involves the fuels being top quality and a good price, otherwise Shell would lose customers. Shell uses the safest way of providing fuels for vehicles and other uses which decreases pollution and rate of growth in the world’s CO2 emissions which also gains customers. The organisation manages greenhouse gases, energy efficiency, control of waste and the impact on water. Local Communities – Shell’s aim is to produce fuels economically while minimising the negative impacts. Shell desires to invest in beneficially for the community projects. The communities which are located near any oil refineries which releases CO2 into the atmosphere have raised concerns of the citizens over their safety. Shell’s objective is to overcome this and earn the trust of people by increasing the safety measures. Shell has also provided health facilities and supported the development of local schools and universities. The business also run a “Shell LiveWire” which is an online community for young entrepreneurs wanting to start a business. It has information and resources as a free guide. Interest groups – Individuals and other organisations who make decisions and create opinions which could possible affect the business. These include:      

Academics Government Media Non-governmental organisations (NGO) Business leaders Financial community

Governments – As mentioned before shell is run in multiple countries, across all regions, to do this the organisation is required to show the government of each country that the business is operating in the right way to get approved and have the ability to sell their products. This consists of providing jobs, paying taxes and providing energy supplies. The organisation also operates with the government to improve the regulation on CO2 emissions. The business community – Shell provides to and buys products from hundreds of other businesses. Other oil companies – Royal Dutch Shell works with international oil companies in a partnership. This speeds up the business and creates more profit from the business. The organisation mostly partners with government owned oil companies which include building new oil or gas refineries ad supply lines. The media – Helps the company gain popularity and improve reputation from positive news articles included on newspapers. Television interviews, articles in magazines and other that the public is shown. This resolves in gaining customers and increasing the chances of gaining a higher position in the fuel market. NGOs – Shell works with many NGOs on a regular basis, which is mostly aimed on a specific issues or problem, e.g. environment, human rights or health. The company works with 100 scientific and conservation organisations in 40 countries. This helps Shell to improve on the approach to the environment. Shell has been in a partnership with International Union for the Conservation of nature led to positive changes which reduced the impact on the environment Shell will only operate in countries which the principles could be followed by the business. The principles set out what Shell stands for and shows its behaviour towards everything, and is published on its website.

Cancer Research UK How are businesses influenced by stakeholders?

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Unit 1 Assignment 1 Cancer Research UK has multiple external and internal stakeholders which helps the not-for-profit business run, all the money goes only towards the business so it can be run.

Stakeholders Internal – represent the company, which is seen by the public which shows the reputation of the business and creates trust from positive popularity. [ CITATION Can18 \l 2057 ] Volunteers – people who are willing to help the organisation without getting any sort of payment just to benefit the business. This lets the company have less running costs which makes more money towards the research. Volunteers mostly help the charity within the local area and community, this could be: 

Shops

Volunteering at shops, consist of multiple jobs which are, Customer Service Assistant, Visual Merchandiser, Deputy Shop Manager, Fundraising Coordinator, Stock Processing Assistant and Admin Assistant. It is stated that the charity has raised £80 million from the shop last year. 

Events

Around 700,000 runners, walker, swimmers and sliders are willing to join events for fundraising. The events provides the organisation approximately £70 million a year to fund the researches. 

Fundraising

This could be run by individual volunteers or a group of volunteers from the company, which aim is to raise money to run the business. 

Campaign

Campaigns are people who try to persuade politicians to support better cancer policies. They write to local politicians which depends on the location of the volunteer. They also meet in person with politicians, while sharing campaign messages on social media, collecting petition signatures and feeding back local information. 

Office volunteering

These are people who support teams across the organisation to deliver their additional administration. Which improves the ability to do more and reach the business’ goal.

All these volunteers, massively influences the business as it covers a huge amount money which would have been spent on employers. Instead the following money go towards research, advertisement and other. [CITATION Can181 \l 2057 ] Employees – The charity needs multiple researches and workers who require payment, which denotes that the charity has to overcome normal wages of jobs which require the same working skills and abilities so that people would join the research with high level of education. This also shows that the company will have more running costs to pay. The business will also need multiple staff who are trained specialist to help and guide teams at events and fundraising so it’s as effective as possible, to gain more money towards the research. Director of strategic resourcing, Tom Russell stated that it requires professionalism especially in relation to the management of large sums of money, which is mostly donated by the member of the public.

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Unit 1 Assignment 1 [ CITATION Can182 \l 2057 ] When Cancer Research UK was formed (2002) there was originally only 20 members but then 60 additional joined bringing the total to 80. Currently there are 93 members including Trustees. These stakeholders help the company actually reach its aim by researching the cure of cancer. These are specifically trained, professional scientist work many hours, focusing completely on the research, which is why the business is influenced by it. [CITATION Can183 \l 2057 ] Scientific Executive Board – These people are in responsibility for implementation of science policy and strategy. They work closely with the research committees and reports to the Executive Board (a number of workers) after it is approved by the Research committees and council. It is mainly responsible for the charities funding, they can also consider the funding for committees and schemes. An example could be that the cost is limited and exceeds the available amount. This stakeholder influences the company as it controls how employees work in the organisation. Without this, the company would be a disaster. External – People outside the business who support the company by either donating, providing items, free equipment or whatever is required for the research. Locals – Citizens of a society, they could participate in local fundraising such as a charity event, marathons, institutions activities and other that involves the public to help raise money from their own will. An example could be:  

Running marathon Football match

The company helps citizens with raising money for the charity, so that it’s not only easier to raise money but improve publicity and popularity of the company for other’s notice. This stakeholder helps the company massively as it creates publicity and makes the company more popular. Therefore it has a large influence on the business. Donors – People who donate money towards the cause, in this case it’s the research to cure cancer. Everyone is able to donate, willingly; they can also decide where the money goes (specific type of cancer). The charity is also transparent by showing where the donations go (https://www.cancerresearchuk.org/support-us/donate). You can also donate specifically to someone and send a message with it. People are able to record the money raised offline towards the cause. This massively influences the company as most of the money for the business comes from these particular stakeholders. Without them it would be very hard to run the company. Beneficiaries – Reason why the organisation is run and was begun. Cancer Research UK was created to not only research the cure for cancer but raise awareness for the public. It helps as many “customers” as possible as that’s the goal of the charity. Anyone who experiences work or help from the organisation might tell about it on television, newspaper or anything that is read by the public. This can result in rise in popularity; increasing the overall donations, help from the citizens and more willing volunteers. Without these stakeholders there would be no point of running this particular business. This is the main influence of the company. (Business case studies, https://businesscasestudies.co.uk/shell/balancing-stakeholder-needs/internalstakeholders.html - Accessed 14th September 2018) (Business case studies, https://businesscasestudies.co.uk/shell/balancing-stakeholder-needs/externalstakeholders-customers-communities.html - Accessed 20th September 2018)

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Unit 1 Assignment 1 (Business case studies, https://businesscasestudies.co.uk/shell/balancing-stakeholder-needs/externalstakeholders-interest-groups.html - Accessed 20th September 2018) (Cancer Research UK, https://www.cancerresearchuk.org/support-us/volunteer - Accessed 19th September 2018) (Cancer Research UK, https://www.employeebenefits.co.uk/issues/december-2007/employer-profile-cancerresearch-uk/ - Accessed 20th September 2018) (Cancer Research UK, https://www.cancerresearchuk.org/about-us/how-we-are-run/our-members - Accessed 20th September 2018) (Cancer Research UK, https://www.cancerresearchuk.org/about-us/how-we-are-run/scientific-executive-board - Accessed 20th September 2018)

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Unit 1 Assignment 1 P3. Organization structures, aims and objectives of two contrasting companies

Royal Dutch Shell Mission – To safely market and distribute energy and petrochemical products while offering innovative value added services. Increasing rank on the petrol market and reputation which results in an increase of customers denoting bigger profit. Values – honesty, integrity and respect for people. Everyone in the organisation have signed the code of conduct which helps everyone at Shell act in line with these values and comply with relevant laws and regulations. Vision – Shell wants to become the biggest and best petrol organisation, associated with fuels (mainly gas and oil). A higher percentage of customers and open the business in a bigger variety countries. [ CITATION She18 \l 2057 ] Aim – The companies aim is to strengthen their position as a leading energy company. This could be achieved by decreasing the CO2 emission while providing oil, gas and energy for customers. Also make the work safer and increase responsibilities for workers. [CITATION She181 \l 2057 ] Objective – Shell’s objective is to efficiently, responsibly and profitably produce oil, gas, chemicals and other selected businesses. This also involves participation in any other source of energy development to help the environment and make it more efficient. This would help the company to evolve and meet customer’s needs and world’s growing demand for energy. Shell created a personal atridimensional matrix structure known as the Shell Matrix, which had functions, regions and sectors. The update structure came out in 1995 where the representation of the company was the move from a geographically based company to a business sector-based firm. The matrix structure included many employees who were sorted in groups. Many workers were hired to help the business run correctly. Because matrix structure retains Shell’s organisational functional structure, they allow for the rapid creation of efficient large-scale, project structures to employ many members of the structure, but without disturbing or destroying the structure in the process. In ideal matrix structure, Shell is able to share resources equally with all sections and keep track with business’s process. This is done without any territorial struggles, because as each functional manager knows, the project structure will eventually dissolve. Other advantages are the clear articulation of project objectives, workable way of integrating with them. Efficient use of limited human resources. Rapid information transformation and finally project structures develop team spirit and high morale. There are different stages of hierarchy in the structure which is used to show who’s in control of what and who. Which makes it much easier for the employees as they know who to go to. This also denotes that there are more 8|Page

Unit 1 Assignment 1 roles in ...