Three Categories of Organizations

Description of Each Category of Organization

There are three categories of organizations. They include profit-making private organizations, government or public organizations, and nonprofit organizations. A profit-making private organization is an individual owned organization that exists basically to generate profit. The owners employ business strategies to gain business operation efficiency in the quest of reducing cost and maximizing on profit. They also focus on customers’ satisfaction to expand the market for the same reason. A profit-making private organization can be involved in diverse business services or selling different goods in different industries, apart from government restricted industries. Government or public organization is a government-owned organization and hence the organization administration and oversight is done by the government through a government agency (Lee & Wilkins, 2011).

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Government organizations are engaged in the provision of basic public services at a subsidized rate. These services include education, transportation, medical care, public health services, and security among others. These organizations focus on enhancing the public good. A nonprofit private organization is an organization that focuses on furthering social courses. Its main objective is to enhance public good but in a specific aspect such as caring for orphans, elderly home care, or any other area where they feel that the government has not exhaustively managed to address the target group’s basic needs. They are mostly tax-exempted and their main role is to help and attain public good rather than making a profit (Lee & Wilkins, 2011).

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Differences Between a Profit-making Private Organization, a Public or Governmental organization, and a Nonprofit Organization

The main difference between profit-making private organizations and the rest is that profit-making private is owned by individuals whose main aim is to maximize the profit. Profit-making is purely funded by individuals or owners through personal means that include savings and loans. They are also taxed based on government taxation law about the size of the business or the annual revenue. Their operations are guided by government regulations especially those on minimum wages, equal employment, and safety among other things (Lee & Wilkins, 2011). However, their management and administration are privately done without a lot of restrictions from the government. They are however guided by the rule of law governing operations in their industry of operation. Nonprofit organizations focus on enhancing public good but in a specific area of operation. The majority are tax-exempted especially if they are engaged in offering public good. Unlike in private for-profit where their workers are compensated based on individual or organization performance, such motivational forms of compensation are minimal in nonprofit organizations.

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Although they are engaged in the public good, they hardly receive government funding. On the contrary, they are mostly sponsored by well-wishers. While profit is the private for-profit is enjoyed by the owner, profit in the nongovernment organization is distributed into the system to facilitate the core course of the organization Government organizations are administered and controlled by the government. They operate under a specific government agency that offers rules and regulations on how they should be run and also receive funding from the government (Lee & Wilkins, 2011).

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