Characteristics of LSOs

Characteristics of an LSO

An organisation is a formal arrangement of two or more people who work together to achieve objectives. In Units 3 & 4 of Business Management the focus is on Large-Scale Organisations (LSOs). An LSO is defined as a substantial organisation that employs 200 or more people, earns revenue in the millions of dollars or has assets equal to more than $200 million.

There are five main characteristics that classify an organisation as a large-scale organisation, are as follows:

Characteristic 1: People

An organisation employs over 200 people is determined to be a large-scale organisation. This includes all members of an organisation across separate divisions and locations. An LSO requires large amounts of employees to oversee their operations.

Characteristic 2: Revenue

A large-scale organisation retains substantial revenue in the millions of dollars. Revenue refers to income that has been earned by an organisation. Large-scale organisations typically maintain a large market share and therefore earn a large profit from its customers.

Characteristic 3: Total Assets

The total assets of a large-scale organisation should totally over $200 million. These assets can include machinery, equipment, materials, locations, property and stock. Large-Scale Organisations require a substantial amount of assets to maintain production and operations.

Characteristic 4: Multiple Locations

Large-scale organisations are typically based in multiple locations, meaning they operate outside of their main location. It can include separate branches, divisions or plants of the same organisation, which could be located domestically or internationally. An organisation operating internationally means that organisation a transnational or multinational corporation.

Characteristic 5: Structure

Large-scale organisations also have a complex management structure involving multiple levels to manage all operations and employees. This involves multiple levels of management with different responsibilities, authority and power.