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BUSINESS AND MANAGEMENT. MODULE 1 BUSINESS ORGANIZATIONS & ENVIRONMENT. Non-Profit & Non-Governmental Organizations. NPO’s operate in a business-like manner but without the profit being the major objective Sometimes referred to as Merit Goods

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Business and management




Non profit non governmental organizations
Non-Profit & Non-Governmental Organizations

  • NPO’s operate in a business-like manner but without the profit being the major objective

  • Sometimes referred to as Merit Goods

  • They aim to provide a service or to promote special causes

    • Libraries; museums, hospitals, charities etc

Merit goods
Merit Goods

  • These are services which people thing should be provided in greater quantities

  • If the individual is left to decide whether or not to pay for these goods, some may choose not to, or may not be able to.

Ngo s

  • Operates in the private sector, ie it is not controlled by the government

  • They do not aim primarily to make a profit

  • Are set up and operate for the benefit of others in society

    • Also known as Private Voluntary Organizations

    • Amnesty International, Unicef etc

Types of ngo s
Types of NGO’s

  • Operational NGO’s

    • Established from a given objective or purpose

    • Tend to be involved in relief-based and community projects

      • OxFam and Unicef

  • Advocacy NGO’s

    • Take a more aggressive approach to promote and defend a cause

    • Direct action and lobbying

      • GreenPeace and Amnesty International


  • A registered NPO with the key function of collecting donations from individuals and businesses in order to support a cause that is beneficial to society

  • Use a variety of marketing methods to attract donor attention

    • Oxfam and World Wildlife Fund

  • Some charities have very complex structures and are run by a Board of Directors similar to a large corporation

Advantages of charities
Advantages of Charities

  • Provide financial support for the benefit of society

  • Exempt from paying taxes

  • Donors receive income tax benefit

  • Can protect employees with limited liability

Disadvantages of charities
Disadvantages of Charities

  • Lack of profit motive may cause problems with staff

  • Trustees, who control the purse strings of a charity, do so voluntarily

  • Finances must be carefully controlled

  • Survive solely on the donations – not allowed to sell anything

    • Difficult during hard economic times

Pressure groups
Pressure Groups

  • Established by the members of an NPO to address a special interest

    • Not a union or environmental protection group

  • Win public and media support

  • Influence government policy

Formative case study
Formative Case Study

Case: Network Rail

On “S” drive

Source: Jones, Hall, Raffo, Business Studies 3rd Edition, Unit 6, page 60.