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Assessment 1 Co-operative Enterprise- The Democratic Alternative Exemplar Solution LO1 1Co-operative Enterprise ( level 6)

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Presentation on theme: "Assessment 1 Co-operative Enterprise- The Democratic Alternative Exemplar Solution LO1 1Co-operative Enterprise ( level 6)"— Presentation transcript:

1 Assessment 1 Co-operative Enterprise- The Democratic Alternative Exemplar Solution LO1 1Co-operative Enterprise ( level 6)

2 Identify a suitable corporate business and a co-operative enterprise The corporate business I have chosen is Marks and Spencer. The co-operative enterprise I have chosen is The John Lewis Partnership. Exemplar Solution LO1 2Co-operative Enterprise ( level 6)

3 Identify values and ethics of the corporate business Marks & Spencer state that they are committed to doing the right thing for their customers, colleagues, shareholders, suppliers, the environment and their local communities. Marks and Spencer states that Brand Values of Quality, Value, Service, Innovation and Trust distinguish their products and services. M&S is owned by the individuals and organisations that invest in shares. They are focused on building a sustainable business for the long term, generating shareholder value through consistent, profitable growth. Marks and Spencer states that colleagues are treated with dignity and respect and expect colleagues to treat each other and their customers in the same way. Corporate and social responsibility are goals of the organisation. Exemplar Solution LO1 3Co-operative Enterprise ( level 6)

4 Identify values and ethics of the co-operative enterprise Ultimate purpose is the happiness of all its members through worthwhile and satisfying employment in a successful business. The power in the business is shared between three governing bodies of employees. The partnership aims to make sufficient profit in its trading operations to sustain its commercial vitality, to finance its continued development, to distribute a share of the profits to its members (employees). The Partnership aims to employ and retain as its members, people of ability and integrity. Relationships within the organisation are based on respect and courtesy, with equality as their position in the company permits The Partnership aims to deal honestly with its customers and secure their loyalty and trust by providing outstanding choice, value and service. The Partnership contributes to the wellbeing of the community in which it operates. Exemplar Solution LO1 4Co-operative Enterprise ( level 6)

5 Similarities in the values and ethics of both organisations Commitment to customers – aiming to deal with honesty, respect and to offer value for money. Both organisations state that profit is a key objective – either to give a return to investors or to its members Growth is a major objective – building sustainable business. Both aim to treat their employees with respect and to offer excellent career opportunities within the organisation. Both enterprises make a commitment to corporate and social responsibility. Exemplar Solution LO1 5Co-operative Enterprise ( level 6)

6 Differences in values and ethics impact on the operation of the business The main differences occur: Employees within a co-operative enterprise are members and have a say in the running of the business and contribute to business decisions, whereas in a business enterprise most employees take no part in major decision making. A business enterprise is owned by shareholders who have a say in the running of the company – electing a board of directors in order to make major decisions, whereas in John Lewis each employee is a partner within the company and as such is considered part owner and is involved in decision making. The ultimate purpose of the co-operative enterprise is the happiness of its members and it rewards its members through profit, knowledge and power, whereas in a business enterprise an employee is rewarded only with remuneration for employment – however the business will make a commitment to ensuring career enhancing opportunities. Exemplar Solution LO1 6Co-operative Enterprise ( level 6)

7 What makes a co-operative different from other types of business? Main aim is not profit but to promote happiness and provide a worthwhile career for all employees. Not owned by shareholders/owner but owned by employees. Main aim not profit but to only make profit to make business continually viable and also to give members a share of profits. Governance carried out by various bodies within organisation elected by members (employees). Aim to contribute to wellbeing of community – social responsibility is written into the constitution. Exemplar Solution LO1 7Co-operative Enterprise ( level 6)

8 Distribution of Benefits Within the Co-operative Members receive share of profits for their contribution to the success of organisation. As a consequence employees motivated because can see relationship between their hard work and the benefit/remuneration they receive for working within the co-operative. Members receive one member/one vote as voting rights – in order to elect the Partnership Board. Therefore they have a chance to elect who actually runs the company. Able to comment on/make suggestions about how to shape future of organisation. Therefore employees may feel more empowered and motivated. Exemplar Solution LO1 8Co-operative Enterprise ( level 6)

9 How does the co-operative business identified put its co-operative principles into practice in its activities? Partnership Council is representative body for all members – which entrusts management to partnership board. Partnership Council discusses, influences and makes recommendations to Partnership Board. Each Partner has a single vote in elections of the Partnership Council. Commitment to spend partnership funds only made upon written authority by Partnership Board (i.e. employees). Each Partner (employee) receives share of the profits on top of salary each year. Exemplar Solution LO1 9Co-operative Enterprise ( level 6)

10 How does the co-operative business’ principles impact on their business? Partners motivated and empowered because feel that they are part of decision making structure and that they are being directly rewarded for work. Customers feel they receive better service/value because of motivated employees. They may feel happier shopping in environment where main aim is not profit but commitment to community and staff. The management are directly selected by staff and also staff are part of management/decision making structure – meaning that the co-operative enterprise can react better to business needs/environment. Exemplar Solution LO1 10Co-operative Enterprise ( level 6)

11 How specific co-operative principles might not apply to your chosen co-operative business Members have not provided any capital to start up the enterprise – they merely contribute by doing an excellent job thus contributing to the overall success of the organisation. No limited rate of return on capital – however this is governed by the needs of the organisation and decided by the Chairman and elected Partnership Board Exemplar Solution LO1 11Co-operative Enterprise ( level 6)

12 How has the co-operative satisfied the essential elements for being a co-operative? It satisfies the elements for being a co-operative by: Resembling any other business – trading in the market and utilising the factors of production (land, labour and capital). Provide value for money and excellent service to customers. Each Partner will receive a share of profits based on position within company. Each member of the Partnership has one vote to elect members of Partnership Board John Lewis Partnership contributes to the community (or education) within its locality. Financial information is disclosed to members (and public as it is a PLC). Partners have access to high quality training and career progression structure. Exemplar Solution LO1 12Co-operative Enterprise ( level 6)

13 What are the rights and responsibilities of ownership within the co-operative ? Rights Profits shared by partners Knowledge to work in a transparent and open environment and be made aware of performance of business Power to determine who runs the business and be indirectly involved in decision making. Responsibilities To take responsibility for the performance of the business To build relationships powered by the company’s principles Create real influence over their working lives Exemplar Solution LO1 13Co-operative Enterprise ( level 6)

14 References The Constitution of the John Lewis Partnership – Introduction, Principles and Rules - December 2011 Marks and Spencer Code of Ethics - April 2010 Exemplar Solution LO1 14Co-operative Enterprise ( level 6)


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