2. Characteristics of LSOs

Question 1

1. What is Large?

Answer 1

• LSO: Is considered an organisation that employs greater than 200 employees, with a significant revenue in the millions, or has assets of more than 200 million.

• The size of an organisation may be defined by the:
■ Number of employees
■ Revenue (gross income)
■ Total assets (value of what the organisation owns—in the case of public companies, this is their market capitalisation or value on the share market).

Question 2

2. Characteristics of LSOs 1

Answer 2

• Employee Base – It employs more than 200 employees.
• Total Assets – It owns substantial assets.
• Total Revenue – It earns substantial gross income or earnings.
• Profits – It has substantial gross profits
• Proportion of Market Share – It commands a large percentage of the marketplace.
• Size of Operations – It can operate using a single, multiple factories, branches and stores.
• Number of Business Locations – Can be local, regional, state, national or global

Question 3

3. Characteristics of LSOs 2 Complex?

Answer 3

• Strategic Objectives are Formulated.

• Strategic Planning is Undertaken.
(planning (two to five years) undertaken by senior management to achiever specific corporate objectives.)

• Formalised Policies, Procedures and Rules are Adopted and Documented.
(to function properly and for all employees to know how to act)

• An Organisational Structure is Devised.
(forms the basis of its internal formal framework to show how management is linked and how authority is transmitted)
(based on departmental lines, with departments being divided according to their function)
• A Chain of Command and Hierarchical Management Structure is Established.

• A Coordinated and Decentralised Approach to Decision Making is Adopted.
(Decentralisation involves delegation to and empowerment of employees and requires coordination to ensure that decisions made throughout the organisation work towards achieving its overall corporate objectives)

• Specialisation of Activities Into Departments or Within Departments Occurs.
(The size and range of activities in which an organisation is involved will generally require it to be broken into departments. This will allow for the specialisation of the activities into department or within departments.)