Key Functional Areas and Operations Within a Company
Functional Areas of a Company
Usually, a company consists of at least five basic functional areas:
- General Management
- Administration and Operations
- Marketing and Sales
- Production
- Accounting and Finance
General Management
This is the managerial head of the company. General Management sets the company’s objectives, based on its business plan, personal goals, and knowledge. It makes decisions in critical and strategic situations, maximizing investment. Its relationship with production includes:
- Strategic guidelines for production.
- General investment in equipment and process lines.
- Investment by area general budget (forecast).
- General policies for customers.
Administration and Operations
This area takes into account all matters relating to the operation of the company in its most general sense: from hiring staff to buying supplies, paying staff, signing checks, and checking that staff comply with their schedule.
- Store planning processes.
- Operational tasks.
- Shift support staff (direct and indirect).
Accounting and Finance
Every company must keep an accounting system detailing cash receipts and disbursements over time. In addition, it must declare and pay periodic taxes based on the company’s financial records.
- Association of budgets or forecasts.
- Financial leverage.
- Systems stock recovery.
- Structure of cost centers.
- Models for costing of production or supply.
Marketing and Sales
This area details the functions, capabilities, and qualities of responsible management involved in business marketing strategy and operations. This includes sales plans, advertising, packaging design, product/service branding, distribution, point of sale, promotion, and sales efforts.
- General or segmented marketing plan.
- Study and market analysis.
- Target market and product definition.
- Market segmentation and product lines.
- Analysis of product life cycle.
- Sales techniques.
- Product design and packaging.
Key Functions within Production
Product Engineering: This role includes the design of the product to be marketed, taking into account all specifications required by customers. Once developed, it’s necessary to verify that the product fulfills its intended purpose.
Plant Engineering: The production department is responsible for the appropriate design of facilities, taking into account the specifications required for proper maintenance and control of equipment.
Industrial Engineering: This includes conducting research concerning methods, techniques, procedures, and state-of-the-art machinery. It also involves necessary work measurements, as well as the physical layout of the plant.
Planning and Production Control: This department’s basic responsibility is to establish the standards necessary to comply with required specifications for quality, production lots, stocks, shortages, etc. It should also generate reports concerning the progress of production to ensure that scheduled programming is being met.
Supply: The supply of materials depends on adequate freight, timely shipping, excellent inventory control, and ensuring that local and international purchases are the most appropriate.
Quality Control: This concerns the overall result of product/service characteristics in terms of marketing, engineering, manufacturing, and maintenance, through which the product or service in use is satisfactory to the customer’s expectations.
Manufacturing: This is the process of transformation necessary to obtain a good or service.
Production Planning basically refers to determining the number of units that will be produced over a period of time, with the aim to provide, globally, what the needs are for labor, raw materials, machinery, and equipment required for compliance with the plan.