FUNCTIONAL AREAS OF A

BUSINESS
 FUNCTIONAL AREAS OF A BUSINESS
Just as different functions in the human body are performed and regulated by different organs,
different functions within a business are performed and controlled by different parts of the business.

One of the reasons for separating business operations into functional areas is to allow each to
operate within its area of expertise, thus building efficiency and effectiveness across the business
as a whole. Functional areas in a business vary according to the nature of the market and the size
of the business. For example, manufacturing companies like Nike and Apple have significant
Research and Development (R&D) departments in order to stay in the lead in their respective
business segments. On the other hand, retail companies may have no R&D functional area per se,
but will be heavily invested in Operations areas surrounding Supply Chain Management.
IDENTIFY THE KEY FUNCTIONAL AREAS IN A BUSINESS

STUDENT 1&2 STUDENT 3&4

THE PRODUCTION FUNCTION

The production function-in production raw materials are transformed into

finished goods. Production management is the process of effective planning and
control of the operations of that section of the enterprise. Functions:
1. Purchasing of raw materials
2. Progress records
3. Production engineering (design product)
4. Production control, planning,
5. Technical management, quality control
6. Research and development
7. Works department (manufacturing of goods)
THE MARKETING FUNCTION
The marketing function-involves all aspects of getting a product or service to the
consumer, including how it will be made available (distribution) and how it will be
paid for (consumer finance). Includes the following activities:
1. Market research
2. Publicity
3. Distribution
4. Imports and exports
5. After-sales services, repairs, refund, etc.
6. Pricing
7. Advertising
8. Sales promotion
9. Sales representatives and mobility of sales people
THE FINANCIAL FUNCTION

The financial function-the financial manager is responsible for the accounting

procedures and processes of the business. A financial manager is recruited to
do:
1. Accounting procedures and processes for cash sales, checking accounts
and other methods of payments, Sales contracts
2. Accounting procedures for Purchasing, actual purchasing of stationery
etc. of a business
3. Investment in plant and machinery, buying stocks and bonds
4. Wage bargaining with trade unions.
 THE HUMAN RESOURCE FUNCTION
The personal (human resource) function-the functions and duties of the personnel manager main concern is the
employees, they are concerned mainly with forecasting, recruitment and selection of employees to the firm.
Functions:
1. Planning and forecasting of manpower needs
2. Recruitment and selection of employees
3. Job analysis, job description, job specifications,
4. See that there is compliance with labor laws, insurance regulations and contracts
5. Formulates terms and conditions of employment
6. Does statistical analysis paying great attention to labor turnover and waste of manpower.
7. Fixes wage rates
8. Looks after the welfare of workers, including benefits, holidays, pensions, retirement, overtime pay, sick
leave,
9. Make performance appraisal.
10. Discipline of workers