(Adapted from https://www.indeed.com/career-advice/career-development/functions-of-businesses)
Businesses and organizations are created to offer professional goods and services to consumers or commercial clients. The purposes or functions of a company and its many departments may vary depending on its goals.
Understanding different business functions and how they work is helpful as you develop your professional career and to help you determine which type of company or department may suit you best.
Here is a list of 15 examples of business functions, whether they are the primary focus of a company or a department within it:
A strategy firm or department develops the strategy, approach, and way to implement change for a company. Strategy-based businesses help others reach their goals and objectives through thoughtful planning, decision-making and risk assessment. They discover the strengths and weaknesses of a company, find its competitive advantage and plan how to reach business goals, like increasing revenue, expanding to new markets, or distributing internationally, for example. Common business strategies include:
Horizontal or vertical integration
Diversification
Market penetration or expansion
Social media engagement
Search engine optimization
Sales funnels
Cost leadership
Cooperative strategy partnerships
Read more: 10 Business Strategy Examples
A finance and accounting firm or department handles business-related aspects like funding, budgets, accounting, and financial oversight. They process tax payments, file tax returns, invoice customers, distribute employee pay checks and track paid time off, record cash flow and expense payments, conduct audits and handle finance or tax law. Another type of financing firm provides companies and small businesses with loans to purchase equipment, inventory, or supplies, most often used to raise capital in the manufacturing industry.
Sales and marketing businesses or teams promote a company to connect with potential investors, clients, customers, or sponsors with the goal of building brand awareness and generating revenue. This includes responsibilities like determining products or services sold, setting competitive pricing and promotions, developing a brand, logo, and motto, and creating effective marking and advertising campaigns. Marketing firms or departments can also oversee website development, digital and social media advertising, search engine optimization and public relations. Other duties of a marketing firm or department include:
Product packaging design
Event and media planning
Influencer marketing
For more on these see the Entrepreneurship section.
Research and development (R&D) firms or departments lead innovation. They conduct market research, industry comparisons, trend identification, product development and business experimentation to help companies determine new products, services, or revenue streams to generate more profit. Research and development firms and departments have strong analysis experience and a deep understanding of current market conditions for a certain industry or sector. Many technology companies invest in R&D firms or teams to develop and release devices that are more appealing than their competitors and get to market first.
Information technology is about the development and operation of applications, systems and hardware and software. IT companies or departments install and maintain communications and security systems, digital networks, internet, and cloud storage. They deploy computers, printers and other electronic devices to employees and help with technical assistance. Sometimes IT firms or departments also help with website development and maintenance and client relationship management. Read more: Learn About the Information Technology Field
Customer service companies or departments manage the relationship a company has with its customers. They may handle customer questions, purchases, returns, or issues and are highly skilled in communication, conflict management, empathy, and patience. With growing technology, customer service representatives can work in-person, over the phone or through online chat platforms to assist customers.
Human resource (HR) companies and departments focus on functions related to employees like recruiting talent, screening candidates, hiring employees, explaining benefits, handling performance management and employee relations, developing corporate policies and fostering organizational culture. HR businesses or departments also ensure compliance with local, state, and national labour and employment laws, resolve conflicts, and investigate claims or allegations. Read more: Human Resources: Definition and How It Works
Design firms or departments handle the visual aspects of brand strategy, identity, and design. They create work for both an internal or external audience, like employees or customers, and produce content for print or online advertisements, billboards, websites, radio and television, social media, or mobile applications. Aspects of design are important because they help foster a brand's image and reputation.
A communications department or agency handles all aspects of public relations, corporate communications and crisis management for a company or brand. They write press releases, reach out to reporters and journalists to promote a company, operate as spokespersons when responding to issues or concerns and write speeches or talking points for executives.
Corporate governance is the direction and control of a company through a system of rules, processes, and practices. The department oversees the performance of management, how a company is governed and to what extent by identifying what roles and positions have authority and accountability in decision-making. The guiding philosophy of corporate governance often focuses on these four concepts: people, purpose, process, and performance.
Production departments or companies are the manufacturing branches of a business to produce products or delivery of services to customers. This could be a factory setting, where teams make airplane parts, for example, or the kitchen of a bakery where breads and sweets are made for a small business or as a supplier to another business. Another kind of production team is one that manages the making of a television show or commercial, movie or musical record. Related: Top 11 Production Skills To Develop
A sourcing department or company handles the pricing and purchasing of materials, components, equipment, supplies, and services, often buying high volumes of items with the goal of lower costs. Job responsibilities can include purchasing, supply chain management, logistics and strategic partnerships for one company or product or several at a time. Sourcing plays a key role in the cost structure of any size business and its long-term competitiveness.
Quality management firms or departments ensure a product or service is consistent and reliable. Quality management procedures often focus on these four steps of production: quality planning, quality assurance, quality control and quality improvement. Teams test a product works to its manufacturing specifications and review and resolve causes of quality issues, not only for the product itself but for the method and means it was made.
Distribution is the process of reaching the customer with products or services on behalf of a company. The manufacturer or company can do the selling and delivery directly itself or through other channels, like distributors or intermediary partners, for example. Retail distribution often has three distinct levels:
Intensive distribution: To as many outlets as possible
Selective distribution: To select outlets in specific areas or locations.
Exclusive distribution: To limited outlets.
Operations is the core business process for a company or organization, and it can vary by industry. For example, an IT company may list its operations as deploying, maintaining, and supporting IT services and infrastructure and a manufacturing company lists production and distribution. A restaurant's operations are in the kitchen, often run by an executive chef while an office manager and administrative team run operations for a doctor or lawyer practice, for example. Regardless of the industry or product, hired teams oversee the operations.
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