Strategy illustration Strategy theory

Ownership

The owner of a business is the person who owns the business - i.e. has put the financial capital into the business and takes out the profit. The controller of the business is the person that makes the management decisions. You can see that as organisations become larger there is a tendency for the control of the organisation to become more widely spread between the owners and those that run the business on a day-to-day basis.

This has been a particular issue in recent years where shareholders in a number of companies are less happy about the way businesses are being run on their behalf. Recent issues have involved directors pay and the ethical practices of some businesses. When directors pay themselves large sums while results of a company are not very impressive then shareholders are likely to take issue at the AGM and can vote out directors if this is part of the constitution of a company.

Shareholders will also try to influence the ethical practice of the businesses that they own. Another issue relating to ownership and control has been that of privatisation. A number of industries were formerly in government hands such as British Rail and British Steel. When these industries were passed into the private sector then the government established regulatory frameworks for these industries. Ownership passed from the government to private shareholders. Control passed from state appointed managers to those appointed by shareholders.

The term privatisation refers to the situation when an industry or organisation moves from government ownership to private sector (shareholder) ownership.



Glossary »

Supporting Documents

These downloads will help to put strategy theory into context using real world examples from real businesses.

Sponsorship as part of the marketing mix
Ford logo

Learn how Ford employed strategy theory to succeed in the automotive industry by downloading our premium case study.

Innovation in infant nutrition
Cow & Gate logo

Learn how Cow & Gate used strategy theory to succeed in the food & drink industry by downloading our premium case study.

Creating a winning marketing mix
JD Sports logo

Find out how JD Sports employed strategy theory to prosper in the retail industry by downloading our premium case study.

Creating the right marketing mix
Motorola logo

Discover how Motorola applied strategy theory to thrive in the telecommunications industry by downloading our premium case study.

The use of social media in promotion
National Trust logo

Learn how National Trust used strategy theory to succeed in the non-profit industry by downloading our premium case study.

Newsletter

Subscribe to our newsletter for current business news including lesson plans and activity ideas.

Share this website