What is an organisation (exam definition)?
A stable, formal social structure that processes resources from the environment to produce outputs, has internal rules/procedures/social structures, and functions as a legal entity.
Key exam idea: organisation ≠ just people
An organisation is a structured system with rules, hierarchy, and processes—not merely people working together.
Organisation as a system — what does it do with the environment?
It takes resources (inputs) from the environment and transforms them into outputs.
Two main perspectives of organisations
Technical/Microeconomic view and Behavioural view.
Technical (microeconomic) view — what does it focus on?
Transforming capital + labour into products/services; efficiency, resource usage, outputs.
Behavioural view — what does it focus on?
Rights, privileges, obligations, responsibilities—balanced through conflict resolution and negotiation; people/motivation/relationships.
Exam tip: Technical vs Behavioural in one line
Technical = what the organisation produces. Behavioural = how people behave inside it.
EU size classification — micro enterprise thresholds
<10 employees and <€2M turnover.
EU size classification — small enterprise thresholds
<50 employees and <€10M turnover.
EU size classification — medium enterprise thresholds
<250 employees and <€50M turnover.
EU size classification — large enterprise thresholds
≥250 employees and ≥€50M turnover.
Why size matters (exam reasoning)
Size affects structure, strategy, resources, and decision-making complexity.
Types of organisations by operations (3)
Physical, Digital, Hybrid.
Physical organisation — meaning + example
Operates in tangible environments (factories, shops, logistics).
Digital organisation — meaning + example
Operates via digital platforms/online services (e-commerce, SaaS).
Hybrid organisation — meaning + example
Combines physical presence with digital tech (retail + online; banks + apps).
Digital firm — what is it?
A firm where key relationships, assets, and core processes are digitally enabled and run through digital networks.
Digital firm feature 1: digitally enabled business relationships
Interactions with customers, suppliers, and employees happen through digital channels.
Digital firm feature 2: digital asset management
IP, financial assets, and human resources are managed through digital systems.
Digital firm feature 3: digital core processes
Core operations run through digital networks/systems (ERP, CRM, HRM).
Digital firm feature 4: greater flexibility (time/space shifting)
Work from anywhere, 24/7 access, global operations become normal.
Digital firm feature 5: enhanced decision-making
Real-time data supports faster and better decisions.
IT vs IS — define Information Technology (IT)
Hardware + software tools a business uses to achieve objectives.
IT vs IS — define Information Systems (IS)
Interrelated components that support decision-making/control, enable analysis/visualisation, and facilitate product creation.
