Unit 1 The Business Environment

Assignment: 2 (P3) (P4)

Both businesses BP and the BBC have organisational structures. The reason of an organisational is to
put in order the workforce to make sure that the organisation is capable to complete vital tasks and
goals. Creating a structure with clear roles, functions and levels of authority and systems help make
sure employees are working together as a team to accomplish everything the business must do.
The term span of control is the number of people that one manger on the hierarchy looks after.
The more people under the control of one manager the wider the span of control. Less people mean
a narrower span of control. For example a BP the board of directors have a large span of control as
they look after the chief executive and he/she controls executive committee. Whereas the manager
of refining and marketing only has to look after the employees in that department meaning the
manager has a narrow span of control.

The term span of control is the number of people that one manger on the hierarchy looks after.
The more people under the control of one manager the wider the span of control. Less people mean
a narrower span of control. For example a BP the board of directors have a large span of control as
they look after the chief executive and he/she controls executive committee. Whereas the manager
of refining and marketing only has to look after the employees in that department meaning the
manager has a narrow span of control.


Within an organisational structure there are levels of hierarchy. Levels of hierarchy show which
levels of management and employees report to whom. For example at BP employee will have to
report to their department manager, who will then report to managers and executives, who then
have to report to the Chief Executive Officer, who then has to report to the Board of Directors. At
the BBC the employees in each department; Operations, BBC North, Finance, Vision, Future Media
has to report to department managers who will then report progress and information to the
Directors and BBC Direction Grou). The higher you are on the organisational structure an employee
is then the higher they are on the hierarchy so they will have a large amount of people giving
information to them and the higher you are on the organisational structure the higher levels of
responsibility you have as you have more employees to look after.

The BP organisational structure is flat. This means that there are fewer managers within the
organisation and less managers in the organisation it means that each manager has a wide span of
control. The advantages of a wide span of control are that there are less layers of management to
pass a message through, so the message reaches more employees faster and as well as this it costs
less money to run a wider span of control because a business does not need to employ as many
managers.


The BBC organisational structure is a matrix structure meaning that people work together on
project in teams with people from different departments. The structure is narrow meaning that BBC
has a narrow span of control. The advantages of a narrow span of control is that is allows managers
to communicate quickly with the employees under them and control them more easily, another
advantage that a narrow span of control is that a wide span of control requires a higher level of
management skill to control a greater number of employees, so there is less management skill
required. This keeps employees involved and employees that feel part of the business are motivated
to do the best they can for the organisation. In both organisations tasks are divided within the
organisation so that they can be
completed on time. For example in BP the business is split up into functional areas. These functional
areas are finance, marketing, human resources, corporate affairs, sales, operations and research and
technology as well as many others. These functional areas mean that different tasks can be
completed using their specialised skills. This allows deadlines to be met and completed to a high
quality because employees are able to use their specialised skills. For example an accountant in
finance department would complete the accounts better than an employee in the sales department
because they are trained to complete that task. The BBC also has different functional areas to
separate tasks. The BBC has functional areas of finance, audio & music, operations, vision and future
media. This allows the BBC to separate job tasks to utilise the employees job skills so that the best
possible job can be done on a task and targets can be met.
Another way that both organisations divide tasks is through having branches of the business in
various geographical locations for example the BBC has British Broadcasting Corporation as well as
BBC North and BBC International. This different branch allow the BBC to keep international and UK
business separate and reduces the work load on one business as the BBC doesnt have to run the UK
industry as well as international business which may lead to employee becoming confused over what
work is for which organisation. The BP organisation is split up into BP Gas, BP Solar and BP Ultimate
this splits up the organisation so that employees can focus on either gas, solar or petrol. Splitting up
the businesses means that they work separately to be able to meet the aims of each branch of the
business so that employees can focus of completing one set of aims for one branch of the business.
The functional areas of both businesses are both similar and different. Both organisations have the
functional area of finance. The role of the finance functional area is to record financial transactions
between the business and customers and suppliers. The role of finance is also to record revenue and
expenditure and from those accounts finance can decide how much money each other functional
area has to spend. For example finance will give marketing a certain amount of money to complete
market research and advertisement so that marketing dont just keep spending money and end up
losing the company money.


Another functional area that is common in both the BBC and BP is human resources. Human
resources role in BP and the BBC is to make sure employees receive on and off the job training so
that employees are safe whilst working in the workplace and they have the sufficient job skills to be
able to complete tasks to a high quality. BP employees need specific training because they are
working with highly flammable materials so need training on how to dispose of hazardous materials


and what to do if there was an accident. As well as finance and human resources the BBC and BP
both have the functional area of operations. At the BBC the Operations Group is responsible for
strategy, policy, distribution, property, legal affairs, fair trading and business continuity, including
managing BBC buildings and major infrastructure projects. At BP operations work on shore and on
oil rigs and jobs roles include identifying and resolving technical problem as well as advising on
health, safety and environmental issues.

The BBC also has the functional are of Audio & Music. The audio & music group is responsible for
the BBCs entire national radio network and for the production of the classical and popular music on
the BBCs 8 national TV channels, 10 national radio stations and 40 local radio stations. On top of
that the BBC also has the functional area of Future Media. The future media division is responsible
for all of the BBCs digital media services, which includes the BBC website, mobile phone applications
and radio and TV channels. The Vision functional area is a very important area of the BBC as they
are responsible for deciding what TV programs are broadcasted on TV. They are also responsible for
producing, scheduling and broadcasting the content on all of the BBCs 8 national TV channels and
other regional channels. The final functional area of the BBC is the News Group. The news group
are responsible for all the news that is found on the BBC News Channel. News group are also
responsible for all current affairs and sports output.

Some other functional areas in the British Petroleum organisation are commercial and sales. The
commercial functional area is responsible for new products as well as performance management.
The Sales department at BP is involved in promoting the BP products, which are fuels, lubricants
and other petrochemicals across, the global markets. Another functional area of BP is Legal. Theyre
aim is to resolve employee allegations this is an employees claim or assertion that another
employee or employer has done something illegal or wrong, this is usually problems over an
employees contract of employment or allegations of discrimination within the workplace. They
operate the three legal systems including employment law and licensing regulations. The legal team
helped to secure the rights to one of the largest oil discoveries in the world.

Functional areas rely on each other because to be able to complete their aims they will need the
other functional areas to complete their aims. For example sales rely on marketing because the
product needs to be good and advertisement needs to inform consumers and persuade them to buy
the BP produce. If marketing isnt sufficient then the sales team will not make enough sales to meet
the board of directors targets.

All functional departments rely on finance as finance decides how much money each department
has to spend. The functional departments need to be given enough funds to be able to complete
their aims.



In the BBC the vision and audio & music group need to communicate as TV shows that the
vision department creates will need sound tracks and other audio so vision relies on audio & music
making the music that they request otherwise the TV program will not be the high standard that
customers expect.

Both British Petroleum and BBC outsource different outside companies to come and complete
tasks within the business. At BP they have outsourced IBM to handle maintenance for BP SAP apps.
They also outsourced IBM for data centre management assignment which includes monitoring,
backup and recovery and database and middleware management. BP has also outsourced
Accenture. Accenture complete the finance and accounting within the BP organisation. Accenture
now complete the accounting functions for BPs U.S upstream, downstream and chemical business.
The BBC outsources their IT department to Siemens. Siemens are now the IT contractor and
complete their tasks like running the extensive BBC website and maintaining the BBC internet
servers.
Organisations outsource other companies to complete roles in the business, because the business
they outsource are specialised and experienced in the job they do and outsourcing is a lot cheaper
than running it inside the organisation as the outsourced company already have the training and
facilities to complete the job to a high standard. Outsourcing is cheaper as the BBC recorded savings
of 20 million.

BPs organisational structure allows them to control their activities and fulfil their core purpose.
The organisational structure of BP is tall and flat because the structure has many levels of hierarchy
and managers have a wide span of control. A wide span of control means that BP can complete their
activities because there are less layers of management for messages to be passed through so
messages are passed through the organisation quickly. As well as this a wide span of control means
that BPs costs are reduced because the business doesnt need to employ as many managers.

The BBCs organisational structure is a matrix structure. This means that people work together on
projects in teams with people from different department. This helps the BBC fulfil its purpose of
enriching peoples lives with programs that inform, entertain and educate because with team
working together they can communicate easier and discuss ideas meaning the best quality TV
programs are produced as different functional areas will know the tasks that they have to complete.