By bahria university Karachi campus

1. Lecture 03
Structure of organization
(Software House)

2. 1. Introduction
2. Ethics and codes of conduct
3. Structure of organization (Software House)
4. Financial practices
5. Human resource management
6. Intellectual property
7. Cyber law
8. Software related contracts
9. Social networking responsibilities and ethics
10. Information security and privacy
Course Outline

3. LECTURE REVIEW
• Introduction
• Legal form of organization
• Companies
• Types of Organizations
• Management of an organization

4. ORGANIZATION
“An organized group of people
with a particular purpose, such
as a business or government
department”

5. ORGANIZATION
It is impossible to live in a civilized society without close contact with many
large organizations such as:
• Schools
• Universities
• Government departments
• Health service
• Commercial and industrial companies

6. LEGAL FORM OF AN ORGANIZATION
Fundamentally the law recognizes individuals that is the individuals have a
legal existence.
• They can
• enter into the contracts which can be enforced by the courts
• Sued for damages
• Give evidence...

7. LEGAL FORM OF AN ORGANIZATION
• Four basic legal forms of organization are:
Sole Proprietorship
Partnerships
Corporations.

8. The vast majority of small businesses start out as sole proprietorships.
• These firms are owned by one person, usually the individual who has
day-to-day responsibility for running the business.
• Sole proprietorships own all the assets of the business and the profits
generated by it.
• They also assume complete responsibility for any of its liabilities or
debts.
• In the eyes of the law and the public, you are one and the same with
the business.
Sole Proprietorship

9. Example
• Jane's Boutique:
Jane is a fashion enthusiast with a passion for
clothing design. She decides to start her own
clothing store, which she names "Jane's Boutique."
Jane operates the boutique as a sole proprietorship.
Here's how her sole proprietorship works:
• Ownership
• Decision Making
• Financial Structure
• Liability
• Taxation etc

10. In a Partnership, two or more people share ownership of a single
business.
• Like proprietorships, the law does not distinguish between the business
and its owners.
• The Partners should have a legal agreement that sets forth how
decisions will be made, profits will be shared, disputes will be resolved,
how future partners will be admitted to the partnership or what steps
will be taken to dissolve the partnership when needed.
• They also must decide up front how much time and capital each will
contribute, etc.
Partnerships

11. Khalil Sattar and his wife Naushaba Khali
Example
• Ownership
• Decision Making
• Financial Structure
• Liability
• Taxation etc

12. A corporation is an organization—usually a group of people or a
company—authorized by the state to act as a single entity and
recognized as such in law for certain purposes..
• The owners of a corporation are its shareholders.
• The shareholders elect a board of directors to oversee the major
policies and decisions.
• The corporation has a life of its own and does not dissolve when
ownership changes.
Corporations

13. Example
• Apple Inc.: Apple is a well-known publicly
traded corporation in the technology
industry. It designs, manufactures, and
markets consumer electronics, software,
and digital services. Apple has millions of
shareholders worldwide and is one of the
largest technology companies in the
world.

14. A company is a legal entity made up of an association of
people.
• Ownership of the company is divided into a number of
shares.
• An individual or another company may own one or more
shares.
• Individuals who own shares in a company are known as
the shareholders or members of the company.
Companies

15. Companies
Public
Private

16. • Public companies are allowed to offer their share to the public and
their names must end with the word “Public limited company”.
• A public company has a minimum paid-up capital of Rs. 5 lacs.
• There is no limit to the number of members, a minimum 7.
• Require prospectus (No of shares, Shares price etc)
• Disclose financial records.
Public

17. company cannot offer its shares to the public and its name must end
with the word “limited”.
• It has a minimum paid-up capital of Rs. 1 lakh.
• • It has limited members up to 200 but minimum 2 .
• Doesn’t Require prospectus
• Doesn’t show Financial records.
Private

18. All companies must have a written constitution, which consists of two
documents
• Memorandum of association....which controls its external relations
• Articles of association.... which states how internal affairs are to be
run.
Constitution of a Company

19. MEMORANDUM OF ASSOCIATION
• This document covers the following matters
• Company Name
• Restrictions
• Country of Registration
• e.g. England & Wales, Wales, Scotland
• Objectives of Company
• Companies Act 1989 allow general commercial company
• A Liability Clause
• Liability of members is limited
• Authorized Share value
• Nominal Share Value and Number

20. ARTICLES OF ASSOCIATION
This document covers the following matters
The rules to be applied in allocating new shares
• The rules governing the transfer of shares
• The rules regarding meetings of shareholders or members
• Appointment and removal of directors
• Powers of directors
• Dividends and reserves

21. ORGANIZING AN ORGANIZATION
• Functional units of organization
• Geographical Organization
• Centralization v decentralization
• Management

22. FUNCTIONAL UNITS OF AN ORGANIZATION
• Five groups of functions exist in almost any organization:
• Production: Activities that directly contribute to creating the products or services
that the company sells
• Quality management: Quality activities necessary to ensure that quality of the
products and services produced is maintained at the agreed level
• Sales and Marketing: Sales is concerned directly with selling the product, while
marketing is concerned with establishing the environment in which the product is
sold (e.g. through advertising) and with deciding how the range of products sold
by the company should develop.

23. FUNCTIONAL UNITS OF AN ORGANIZATION
• Finance and Administration: To pay bills, to look after its funds, All central
services.
• Research and development: How can the company do better the things that it
already does and what other things might it profitably be doing?

24. Geographical Organization
• An organization operates in more than one country.
• The most obvious examples are in the field of food and drink. (KFC, Mcdonalds,
Nestle)

25. CENTRALIZATION V. DECENTRALIZATION
• In a centralized organization, the detailed operational decisions are taken at the
center.
• In a decentralized organization, as many details as possible are settled at local
level

26. MANAGEMENT
• Production Manager: Production management is concerned with productivity,
efficiency and maintenance of quality.
• General Manager: General or corporate management deals with the management
of the organization as a whole.
• Corporate Manager: Corporate managers are responsible for the long-term
strategy of the organization. Monitor the overall performance of the organization
and be prepared to handle serious problems which arise anywhere in the
organization.

27. MANAGEMENT
• Production Manager: Production management is concerned with productivity,
efficiency and maintenance of quality.
• General Manager: General or corporate management deals with the management of
the organization as a whole.
• Corporate Manager: Corporate managers are responsible for the long-term strategy
of the organization. Monitor the overall performance of the organization and be
prepared to handle serious problems which arise anywhere in the organization.