FUNCTIONAL AREAS OF BUSINESS
Functional areas of business refer to the different departments within a company that are responsible for specific tasks or functions. Some common functional areas include:
HUMAN RESOURCE
HR department is in charge of recruiting, training, compensation, performance appraisal, manpower planning, employee relations in an organization. The HR department is responsible for ensuring that department employees are well-versed in their areas of expertise. HR department increases employee’s job satisfaction and self-actualization: It tries to prompt and stimulate every employee to realize his potential. To this end suitable programs are designed aimed at improving the quality of work life.
Impact on Marketing Function
HR and marketing are closely bonded, HR department provides appropriate personnel for various marketing jobs and plan training programs to improve the employee skills, as well as motivate them. The HR department’s proactive approach helps in establishing the number and skills of the workforce required by the marketing department in the future. Effective recruitment and compensation policies create a positive impact on marketing and sales. Therefore, HR policies and implementation can create an energized workforce that can substantiate the promises made by marketing managers.
FINANCE
Finance function is concerned with raising, allocation, administration and controlling of funds. The role of finance department in organization is to ensure that are required to help achieve the organizational objectives. The department also ensures that the costs controls, adequacy of funds. All of which are extremely important for successful running of any organization.
RESEARCH & DEVELOPMENT (R&D)
R&D department is in charge of creating new products and innovation which is very important to stay ahead in competition. R&D also carries out the task of improving existing consumer products and to explore new ways of producing them. R&D also strives in controlling costs and adopting efficient methods of production to increase profitability of the company. R&D department will provide advancements in products that ranges from simple updates of features to invention of new products.
Impact on Marketing function
Often, R&D works closely with the marketing department. The core activity of R&D department involves development of new products, which are essential for marketers to generate profits in medium and long term. All the products go through a product life cycle and have a finite commercial life, an example of this is electronic products where new technological developments occur continuously. Further existing products must be maintained to ensure that they can be produce to specification and commercial life of a product may be increased by enhancing features, improving its performance, changing its appearance, or making it cheaper to produce, etc.
PRODUCTION MANAGEMENT
Production management is scientific way of planning, organizing, directing and controlling the activities involved in production process. It deals with conversion of raw materials into finished goods or products by incorporating the factors of production namely, men, money, machines, materials, methods and markets to satisfy the wants of the people. On the other hand, operations management deals with framing and controlling business operations in terms of production of goods and services by designing the method of conversion of inputs (in the form of Land, Labour, Capital, Organization) that are processed and converted into output (in the form of goods and services)
Impact on Marketing Function
Marketing is a tool to drive sales and satisfy the needs of the customers. Therefore, the efficacy of the marketing is dependent on production and operations management to ensure that a business sells products that meet customer needs and wants. The role production and operations are to ensure that the business actually makes the required products in accordance with the plan. Therefore, production and operations management is accountable for producing the desired products and services which can be marketed at an economical price by appropriately planning all the resources available like Land, human resources, finance and leadership.
SUPPLIERS
Suppliers are part of the supply chain management who supplies the resources needed by the firm to produce its goods and services, this includes manufacturers, importers, wholesalers, retailers and hire companies. Suppliers play a major role in an organization’s microenvironment. Suppliers and marketing firm are dependent on each other, and their relationship is built on the basis of value. This relationship is enhanced and nourished with strong business ties and establishes a mutual relation to achieve desired goal. The ties become stronger provided expectations of both the parties are met. A marketer expects good credit terms, timely supply from the supplier on the other hand suppliers expect prompt payment and good business from the marketers, therefore both marketing firms and suppliers are highly dependent on each other. The most important thing is that a marketer cannot offer customers satisfaction if the mutual goals of supplier and marketing firms are not met. It is important for the marketing firm to establish proper communication and share required information with suppliers on various issues such as pricing, transportation, customer feedback, product availability and delivery, etc.
MARKETING INTERMEDIARIES
There are different intermediaries involved in marketing distribution channel from producer to the final user. The intermediaries help marketers to promote, sell, and make – available a good or service through sales agreements. Marketing intermediaries play a crucial role in creating place, time and possession utilities. Their role is to make sure that products and services are made available on time when needed. They provide services such as transportation, financing, storage and distribution, etc. without intermediaries the entire marketing process will lose its efficiency.
CUSTOMER
Customers are the most important stake holders of any business. They are the resource upon which the success of the business depends. Focusing on customers and their experiences is the crux of marketing function. It is important for marketers to carefully understand all relevant buyer behavior and product usage characteristics. Marketers can no longer solely rely on their outdated methods to understand customer needs. They can use various new methods to collect the information about potential customers. Marketers focusing on customer orientation should highly focus on understanding their customer and responding to their needs. Customer satisfaction is at the heart of the selling process, marketer should be highly concerned about customer satisfaction in the new customer – centric business world. Going by the fact it costs five times as much to attract new customers as it does to keep an existing one. The relationship between the customer and the marketer is therefore important.
SHARE HOLDERS
Shareholders are the owners of business. Depending on structure of the company the share holding pattern varies. A small enterprise may have just one share holder, one proprietor, while a public limited company may have thousands of individual and institutional shareholders. Shareholders play an important role in the financing, operations, governance and control aspects of a business. The shareholders expect the management to generate a high rate of return on their capital. In order to meet the expectations of the shareholders marketing department plays an important role, with the help of effective marketing strategies a business can boost its sales revenue and attain marketing leadership this will not only help in giving good returns to share holder but also increase the value of shares.
COMPETITORS
In business it is very important to understand who the competitors are? Analyzing competitors closely will help in framing marketing plans effectively. Competitor analysis is an important part of designing marketing strategies and this involves assessment of the strengths and weaknesses of current and potential competitors and helps in assessing marketer’s position in the market and improve its products and marketing strategies. In today’s competitive market it is important to know what your competitors are doing and what to do to stay ahead of the competition. Competitors analysis provides a realistic picture of competition in the market and gives the marketers an opportunity to figure out the areas of improvements. It also helps in product comparison and promotional decisions. The best way to compete with competitors is through cost advantage or product advantage. Cost and product advantage enables marketers to perform in one or more ways that competitors cannot or will not match.
Competitors analysis
- Identifying competitors
- Profiling competitors
- Comparison of your potentials with competitors
- Developing marketing strategy
Most firms face four basic types of competition:
1) Brand competitors
It refers to competition
with different brands offering similar features, prices and benefits to the
same potential customers.
2) Product competitors
It offers same product class but with offer different benefits,
features and prices.
3) Generic competitors
They are rival firms offering products which
are different but are capable of satisfying the same basic wants or provide the
same benefits or utility to the prospective customer.
4) Total budget competitors
It primarily focuses on prices, they compete
for the limited financial resources of the same customers.
