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Imagine a business with no division of labor or responsibilities. That doesn't make much sense. To operate efficiently, most businesses split operations into different functional areas. Each area is accountable for completing tasks and achieving outcomes within a specific area of expertise. This is typically represented in an accountability chart.

The specific functional areas a company uses depend on the size and nature of the business. For example, a large tech firm will usually have a dedicated team for research and development. However, if they offer their products only as an online download, they won't need a functional area for supply chain and logistics. You can find a list of business functions here.

Additionally, some businesses may opt to outsource some functions rather than keep them in-house.

One functional area does exist in virtually every business. That's the management layer. This layer may have a deep, complex hierarchy or be very simple. That depends on the overall structure chosen for that organization. In a functional organizational chart , the management layer would be at the top.

What Are the 5 Core Functional Areas of a Business?

There are five primary functional areas. These are:

1. Management

2. Operations

3. Finance

4. Sales/marketing

5. Research and development

Not every business will have all of these, but most will have at least three. Here's an overview of each.

Management

The management team provides leadership, creates and implements strategy, approves initiatives, and engages in planning for the future. Executives, department leaders, and managers are a part of this functional area.

The management tier is connected with the other primary teams through department managers or supervisors. For example, the department manager of sales and marketing might be part of the management layer but also have a role in the sales and marketing team.

Finance

This functional area is responsible for financial management, planning, and stewardship. This team must make decisions that ensure the organization's fiscal health so the company has the money it needs to achieve its goals. It must also ensure there is cash on hand for operations and emergencies.

The finance team is often led by the CFO. However, there may be other leaders serving under that role. For example, it's common for there to be teams within the finance functional area. HR, accounting, and legal often fall under the CFO. Each of these teams often has its own department head who reports to the CFO.

Sales/Marketing

Sales and marketing are usually combined into a single functional area. The work and responsibilities of each division tend to interrelate pretty closely.

The marketing team is responsible for understanding the target customer and presenting products and services in a way that aligns with their needs. They determine how to promote products and where. Often, marketing teams also influence pricing, packaging, and even delivery strategy.

The sales team picks up where the marketing team leaves off. They are responsible for taking the leads and prospects created through marketing processes and converting them into profitable sales.

The sales team may be quite small. In many organizations, each sales rep handles all types of customer prospects. They are responsible for the entire sales lifecycle.

In a larger organization, the sales team may be much more complex. For example, some salespeople will work in the earlier stages of sales in lead qualification. Others will take over to close deals. There may also be inside and outside sales teams or special sales teams to handle VIP accounts.

It is common for customer service teams to be part of sales/marketing. Customer support often integrates with sales, especially if the business relies on ongoing customer relationships.

Research and Development

In businesses that don't have all the key functional areas, this is usually the one that is missing.

Research and development is often a part of technology and manufacturing-focused organizations. These teams work to create or improve innovative products and services based on the needs or demands of customers.

If you have a research and development team, you may structure it to include additional teams beneath it in your organizational design. IT and development teams are often included here.

Operations

Operations is the functional area that is responsible for converting inputs into outputs. Inputs might be design specs, raw materials, work orders, etc. Outputs are the products and services your organization provides to customers. In addition to production, the supply chain is included in this functional area.

Key Roles from within Each Functional Area

Here are some of the roles and responsibilities for each of the main functional areas.

Management Roles

In a traditional hierarchy, the management functional area includes the C-level roles (CEO, CFO, CMO). This layer is usually followed by VPs or department managers. There may be director roles beyond that.

Finance Roles

The teams within this functional area may include several roles that relate to the organization's acquisition, tracking, and use of funds.

Human Resources

This functional area is responsible for recruiting, hiring, training, compensation and benefits, and compliance with labor law. Roles include:

Payroll clerk

Benefits administrator

Corporate trainer

These positions generally report to the VP or director of HR.

Accounting

Accounting is responsible for the appropriate use of money flowing in and out of the org. This team ensures that invoices are issued, bills are paid, and financial records are maintained. These responsibilities may be divided among these roles:

Accountant

Accounts receivable clerk

Bookkeeper

These roles often report to the VP of accounting.

Sales/Marketing Roles

This functional area is largely responsible for all work related to customer acquisition and retention, including managing the company's reputation, generating interest in products and services, and providing customer support. Key roles in this department include:

Marketing data analyst

PR manager

Sales team leader

Communications specialist

Customer support manager

These teams often report to the VP of sales and marketing or to the CMO.

Operations Roles

The operations area is responsible for producing or executing the products and services the organization provides. Roles include:

Production worker

Supply chain manager

Quality control director

This functional area is ultimately led by the COO.

Research and Development Roles

Research and development is responsible for creating new products and improving existing products. Depending on the nature of the organization, roles might include:

Product managers

Engineers

Analysts

There is often a VP of development or CTO at the top of this functional area.

Understanding the Functions of Your Organization

If you document and diagram your company's functional areas, you will come away with a greater understanding of the roles and responsibilities within each one. Additionally, you can map how reporting and communication flow through your management hierarchy and between functional areas. Many companies find Functionly useful for this task - start for free today.

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Imagine a business with no division of labor or responsibilities. That doesn't make much sense. To operate efficiently, most businesses split operations into different functional areas.

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Quizizz - The world's most engaging learning platform

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Marketing Mix quiz for 11th grade students. Find other quizzes for Other and more on Quizizz for free!

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4.2 Marketing planning quiz for 11th grade students. Find other quizzes for Business and more on Quizizz for free!

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Identifying evidence for students' learning

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Identifying evidence for students' learning

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Once you have clear learning outcomes in place, the next phase is to determine what constitutes evidence that learning has taken place. If you are re-examining your department's or program's whole curriculum, then the next thing to do might be to create a curriculum map. The curriculum map helps you determine what courses are meeting learning outcomes and where they are being introduced, emphasized, and reinforced. Click the link here - " How to Create a Curriculum Map" (from Jim Munger, AVP Academic Planning, Boise State University) or in the Resources drop down above to see a spreadsheet with instructions on creating a curriculum map.

In many cases evidence of learning outcomes accomplishment will come from student artifacts- assignments from classes, pieces of writing, projects, exams. In other cases, evidence takes the form of carefully constructed surveys.

Remember, assessment should tell you how well your students have met the learning outcomes, not necessarily how well they have learned the content.

When considering assessment, ask yourself what you would consider as "evidence" that learning outcomes have been met. What would you need to see or observe?

How to assess that learning outcomes have been met

Keep in mind that learning outcomes can be assessed either directly or indirectly. Priority is always given to direct measures as they are more objective, concrete, and measurable. Indirect measures can also be helpful as a means of supplementing direct measures. Below are some examples direct and indired methods of assessment that your program can use to determine that learning outcomes have been met.

Find additional information on direct and indirect methods of assessment for program learning outcomes in the From Measures to Findings handout from the Office of Instruction and Assessment at the University of Arizona.

The Southern Education Foundation has a wonderful Building Your Assessment Toolkit that helps to identify the type of assessment needed for a program's goals and provides thorough descriptions, strengths, and weaknesses of a number of assessments.

Confused on how learning outcome assessment differs from the grades students get in their classes? Check out the Grading or Assessment? That is the Question handout from the Office of Instruction and Assessment at the University of Arizona.

Aligning Learning Outcomes with Assessment

While it may seem obvious, it is worth mentioning the need to make sure each learning outcome is aligned with an assessment. It can be easy to come up with a handful of assessments to only later realize that one or two of the learning outcomes haven't been addressed by the assessments. Additionally, you don't want to find that you have been using assessments that don't actually address any of your learning outcomes. One easy way to ensure that your learning outcomes and assessments are aligned is to fill in a Learning Outcome Assessment Alignment Grid. The form to the left is a modified version of L. Dee Fink's Worksheet for Designing a Course ( Fink, 2003, p.23).
DOWNLOAD A COPY

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Determine Evidence - Learning Outcomes Assessment - Undergraduate Studies - The University of Utah

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Critical Issues in Business: Success and Failure

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UNIT 4 - HOW TO CREATE A MARKETING PLAN 

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UNIT 4 - HOW TO CREATE A MARKETING PLAN 

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https://youtu.be/rW17_e7_SYc?si=nTKV8V3rYc5NLypa

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The Marketing Mix Song (Business Studies take on Paparazzi by Lady Gaga)

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Unit 4: Examples of marketing mix

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The 4 Ps of The Marketing Mix Simplified

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You have developed a new product, hurray! The only problem is that products don’t sell themselves – we need a way to introduce them to our potential audiences. In this article, we will explore different ways of how to create a marketing plan for a new product. What is a product marketing plan? A pro…

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Teaching and Learning Resources | Two Teachers Business | United Kingdom

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Two Teachers produces teaching and learning resources, weekly videos and content aimed at helping business teachers teach and business students learn.

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Marketing Concepts & Types of Promotions

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Specification

First teaching: 2014

Last registration: 31 August 2022

Final certification: 30 November 2024

Designed to address the needs of learners in key areas, including interpersonal skills and customer service. Learners can develop skills to support them as they build relationships with a variety of customers, internal and external, to a range of business environments.

First teaching: 2014

Last registration: 31 August 2022

Final certification: 30 November 2024

Designed to address the needs of learners in key areas, including interpersonal skills and customer service. Learners can develop skills to support them as they build relationships with a variety of customers, internal and external, to a range of business environments.

First teaching: 2014

Last registration: 31 August 2022

Final certification: 30 November 2024

Designed to address the needs of learners in key areas, including interpersonal skills and customer service. Learners can develop skills to support them as they build relationships with a variety of customers, internal and external, to a range of business environments.

Want to teach this in 2020?

Talk to us today and we'll make sure you have the latest news and guidance to support to you.

Speak to us today

Want to teach this in 2020?

Talk to us today and we'll make sure you have the latest news and guidance to support to you.

Speak to us today

Want to teach this in 2020?

Talk to us today and we'll make sure you have the latest news and guidance to support to you.

Speak to us today

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Functional objectives are those that relate to the specific functions of a business (e.g. marketing, operations, HRM, finance) and which are designed to support the achievement of corporate objectives.

A well-established business will divide its activities into several business functions. These traditionally include areas such as:

Finance & administration

Marketing & sales

Production & operations

Human resource management

Whilst each of these functional areas requires specialist expertise, their activities are not carried out in isolation from the rest of the business. It is vital in your studies to consider the ways in which the functional activities are connected to each other.

However, it is common for each functional area to be set its own objectives, which should be consistent with the higher-level corporate objectives.

So, functional objectives are:
Set for each major business function and are designed to ensure that the corporate objectives are achieved
Consider some example objectives for the marketing function. Examples of functional marketing objectives" might include:

We aim to build customer database of at least 250,000 households within the next 12 months

We aim to achieve a market share of 10%

We aim to achieve 75% customer awareness of our brand in our target markets

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Functional objectives are those that relate to the specific functions of a business (e.g. marketing, operations, HRM, finance) and which are designed to support the achievement of corporate objectives.

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What Are The 8 Business Functions? A Simple Explanation | Introduction to Business Studies

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Free Goods and Services Worksheet for Kindergarten

Kids can sort pictures of goods and services by completing a simple cut-and-paste activity in this free social studies worksheet.

What are the differences between goods and services? Goods are objects that you can buy. The pictures of goods in this worksheet include a pan, pitchfork, hammer, and toothbrush. A service is a job someone does for someone else. The pictures of people who perform services in this worksheet include a mechanic, pilot, veterinarian, dentist, and doctor.

This social studies sorting activity is a great way for kids to build categorization skills and improve their understanding of the difference between goods and services.

Our goal was to make it as easy as possible for educators and families to utilize our worksheets. To achieve this, we offer three options for accessing our free worksheets: downloading the PDF file, printing the worksheets directly from your browser, or using the kindergarten worksheet online.

Here are the three versions of this kindergarten worksheet:

Tips on Using the Goods and Services Worksheet

There are three icons above the free "Goods and Services" worksheet. The first is labeled "Download" and will provide you with a PDF version of the worksheet to download. For the best results, it's recommended to print the PDF version. The second icon is labeled "Print," which will take you to a separate web page with just the worksheet so you can print it directly from your browser. The third icon is labeled "Online," which will take you to our kindergarten web app, where you can complete the social studies worksheet using your computer, tablet, or other device with a web browser.

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Kids can sort pictures of goods and services by completing a simple cut-and-paste activity in this free social studies worksheet.

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Learning Objectives

Identify the primary functional areas within a business

Identify key people and explain the activities within each functional area

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.

In general, the key functional areas of a business are the following:

Management

Operations

Marketing/Sales

Finance

Research and Development

Each of these functional areas are represented in the following organization chart.

Management

The primary role of managers in business is to supervise other people's performance. Most management activities fall into the following categories:

Planning: Managers plan by setting long-term goals for the business, as well short-term strategies needed to execute against those goals.

Organizing: Managers are responsible for organizing the operations of a business in the most efficient way, enabling the business to use its resources effectively.

Controlling: A large percentage of a manager's time is spent controlling the activities within the business to ensure that it's on track to achieve its goals. When people or processes stray from the path, managers are often the first ones to notice and take corrective action.

Leading: Managers serve as leaders for the organization, in practical as well as symbolic ways. The manager may lead work teams or groups through a new process or the development of a new product. The manager may also be seen as the leader of the organization when it interacts with the community, customers, and suppliers.

Operations

Operations is where inputs, or factors of production, are converted to outputs, which are goods and services. Operations is the heart of a business providing goods and services in a quantity and of a quality that meets the needs of the customers. Operations control the supply chain, including procurement and logistics.

Marketing/Sales

Marketing consists of all that a company does to identify customers' needs and design products and services that meet those needs. The marketing function also includes promoting goods and services, determining how the goods and services will be delivered, and developing a pricing strategy to capture market share while remaining competitive. In today's technology-driven business environment, marketing is also responsible for building and overseeing a company's Internet presence (e.g., the company website, blogs, social media campaigns, etc. Today, social media marketing is one of the fastest growing sectors within the marketing function.

The goal of Sales is to close the revenue the company needs in order to operate profitably, especially in B2B businesses. Again, depending on the nature of the market and the company size, Sales functional areas can vary in structure and approach: inside/outside representation, vertical/horizontal focus, direct, etc. Sales works to exploit the leads created by Marketing and activities generated by the sales force itself.

Finance

The Finance function involves planning for, obtaining, and managing a company's funds. Finance managers plan for both short-term and long-term financial capital needs and analyze the impact that borrowing will have on the financial well-being of the business. A company's finance department answers questions about how funds should be raised (loans vs. stocks), the long-term cost of borrowing funds, and the implications of financing decisions for the long-term health of the business.

Accounting is a crucial part of the Finance functional area. Accountants provide managers with information needed to make decisions about the allocation of company resources. This area is ultimately responsible for accurately representing the financial transactions of a business to internal and external parties, government agencies, and owners/investors. Financial Accountants are primarily responsible for the preparation of financial statements to help entities both inside and outside the organization assess the financial strength of the company. Managerial accountants provide information regarding costs, budgets, asset allocation, and performance appraisal for internal use by management for the purpose of decision-making.

Key People Within Functional Areas

Here is an example of the functional areas of a large technology manufacturing corporation and the key functions and people within.

The Management functional area in most large corporations is led by the Chief Executive Officer (CEO). Depending on company size, there may be a President in position as well.

The Operations functional area is managed by the Chief Operations Officer (COO). In this example, Operations consists of Production, led by a Vice President (VP), a Supply Chain department, and a Procurement area with Director-level people in charge.

The Finance functional area is led by the Chief Financial Officer (CFO), who is one of the most important "C-level" executives. In addition to running Finance and Accounting, the CFO is responsible for reporting company results to the financial community. Finance also contains Human Resources (HR) in many companies and the Legal department as well. It is common for the CFO to have VPs of HR, Accounting, and Legal as direct reports. HR contains functions like employee training, compensation and benefits, and recruiting. Accounting has multiple functions such as Accounts Payable, Receivable, record-keeping and cash flow. The Legal department is responsible for contracts, copyrights, and various negotiations on behalf of the company.

The Marketing/Sales functional area is managed by the Chief Revenue Officer (CRO), which is a relatively new addition to C-level executives. The CRO may have a Sales VP and Marketing VP as direct reports, but in some cases the CRO may act as VP of Sales or Marketing. This functional area may also contain Customer Service (and Support) with a Director-level manager in charge. Marketing has specialized functions such as communications (press releases), social media, data science analysis and product marketing. Customer Service is usually responsible for Customer Relationship Management (CRM) and problem resolution and support.

Finally, the Research and Development functional area is the lifeblood of manufacturing businesses. R&D is staffed with scientists, thought-leaders, subject-matter experts and industry analysts striving to provide the organization with knowledge and ideas to keep up and ahead of the competition. R&D is led by the Chief Technology Officer (CTO), who manages a Development VP or similar title depending on what technology products are being produced: semiconductors, athletic footwear, software systems, or dental appliances. In many organizations, the Information Technology area (IT), responsible for providing internal technology tools to the company's employees, is housed in the R&D organization.

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Identify the primary functional areas within a business Identify key people and explain the activities within each functional area 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.