The organisation of an enterprise is the division of the business according to function, to help it achieve its objectives. It is usually divided into a hierarchy of decision-making bodies and departments.
The General Assembly (Shareholders)
The supreme decision-making organ, which votes on policies and elects members of the board of directors. It can also dissolve the board if it is not meeting the enterprise’s objectives.
The Board of Directors (BOD)
Appointed by shareholders (or by the government for a state-owned company) and headed by a board chairman. The BOD sets important policies and strategies, amends the articles of association, approves manager promotions and salary scales, and fixes investment ceilings. It may appoint a Managing Director for day-to-day control and urgent decisions.
Key Departments
- Purchasing (merchandising) department: headed by the purchasing manager, who sends enquiries to suppliers, selects suppliers, places orders, purchases raw materials and equipment, ensures prompt delivery, and sources new suppliers.
- Production department: headed by the production manager, who transforms raw materials into products, ensures sufficient labour and materials, determines the production process and timing, undertakes quality control, and prepares purchase and store requisitions.
- Storage department: the storekeeper registers goods bought, keeps and organises inventories, issues them to production, prepares bin cards, and informs purchasing when materials are running low.
- Accounting/financial department: headed by the chief accountant, who determines and allocates capital, ensures bills are paid on time, keeps transaction records, controls costs, and prepares the audited accounts and balance sheet at year-end.
- Personnel department: headed by the personnel manager, who advertises posts, interviews and trains workers, oversees health and safety, and negotiates with trade unions.
