Functional Areas in Business Organizations

This article discusses the importance of functional areas in business organizations and describes the key functional areas such as marketing, human resource, customer service, finance, research and development, and sales. It also highlights the skills required by employees to work effectively in these functional areas.

Functional Areas

Table of Contents
INTRODUCTION...........................................................................................................................3
What is a business?..........................................................................................................................3
What are Functional areas of business?...........................................................................................3
What are the key functional areas of a business?............................................................................3
Description of the various functional areas in business organizations............................................4
Marketing...............................................................................................................................4
Human Resource Management...............................................................................................4
Customer Service....................................................................................................................4
Finance...................................................................................................................................4
Research and Development....................................................................................................5
Sales........................................................................................................................................5
Description of the types of skills needed by employees to be able to work effectively in these
functional areas................................................................................................................................5
Skills needed by Marketing employees..................................................................................5
Skills needed by Human Resource Management employees.................................................6
Skills needed by Customer Service employees......................................................................6
Skills needed by Research and Development employees.......................................................6
Skills needed by Finance employees......................................................................................6
Skills needed by Sales employees..........................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Functional areas are group of people who have similar expertise and skills. It is an area,
department and people who carry out the business function in order to generate revenue. There
are various functional areas of business such as marketing, human resource, sales, IT, Finance
and many others (Nalawade, More and Bhola, 2019). The project highlights about the functional
areas of business in which several types of departments are described with their key roles and
responsibilities within workplace. It also covers the skills which are necessary for employees to
work in different functional areas. The report includes a case study in which John has won
lottery and decided to buy local company (IOM Electronics Ltd). The firm has 200 employees
and also expanded their business in Liverpool and Manchester.
What is a business?
Business is a concept of exchanging goods and services in order to maximize profit and earn
great return. It is an activity that includes various functional activities that helps in attaining
goals and objective of organisation. Business is important for the country as it helps in improving
the standard of living of people and also offers high quality of goods and services which are
required by people for their comfort, health and enjoyment. The main purpose of business is to
create profit for their shareholders (Kasaev, Petrovskaya and Kasaev, 2019).
What are Functional areas of business?
Functional areas play an important role in improving the performance and productivity of
business. Without functional areas, organization can’t run their business in effective and smooth
manner. It is a business activity that enables employees to perform and operate the functioning of
organization (Monden, 2019). It is important for the business to interlink the functional areas so
that they can work together and achieve the common goals and objective of company.
What are the key functional areas of a business?
The key functional areas of business help in improving the profitability and growth of
organization due to which they can gain competitive advantage and success in market. There are
various kinds of functional areas within business such as IT, finance, human resource, marketing,
sales, production and operation. Functional areas also help in improving the productivity and
work of organisation.

Description of the various functional areas in business organizations
Marketing
Marketing is a concept of communicating, creating, exchanging and delivering the
offerings that creates value for society, consumers and partners. It is a process of promoting
products and services in market which attracts large number of people towards the brand. The
few examples of marketing at work includes billboards on side of road, television commercials
and magazines advertisements (Barkela, 2021). The main motive of marketing is to generate
revenue for company and create strong brand awareness in market. Marketing plays an important
role in boosting the sale and productivity of business by building trust among buyers and
creating product awareness among them. John must focus on developing marketing department
so that they can promote the products of IOM Electronics and reaches to large number of people.
Human Resource Management
Human resource management is another functional area of business which mainly
focuses on managing the life cycle of employees form starting to end in workplace. They
generally perform various types of activities in enhancing the productivity and growth of
business such as recruiting, selecting, on-boarding, performance management and compensating.
Human resource management plays an important role in organization as they deal with issues
and conflicts within workplace. It is important for John to have human resource department in its
IOM Electronics so that they can maintain and manage workforce of company.
Customer Service
Customer service is also a functional area of business which mainly focuses on providing
better experience to consumers and also solves their queries in effective and efficient manner.
They generally focus on supporting customers and ensure that they must not face any difficulty
while purchasing or after the use of product (Shams and et. al., 2018). It is necessary for IOM
Electronics to have customer service department so that they can handle the issues related to
customers and helps in solving it in effective and smooth way.
Finance
The finance department plays a crucial role in organization as they create document and
control incoming and outgoing cash flows of business. They are responsible for payment of
salary, wages and bills. IOM Electronics must focus on developing finance department so that

they can manage the finance of company and also analyses the financial performance of
business.
Research and Development
Research and development is another function of business which makes business
competitive by offering insights into the market and also develop new goods and services in
order to increase the profitability and growth of business. IOM must focus on hiring employees
who have interest in research and development department. It is one of the important functional
areas for IOM Electronics as it helps in understanding the needs and preference of consumers
due to which company can produce the product and satisfy the consumers.
Sales
Sales department is also a functional area of business which mainly focus on improving the
sale of organization by using various tools and techniques that attracts large number of
consumers towards the brand (Stawasz, 2020). They generally look for sales opportunities and
also identify the target budget for each year. IOM Electronics must focus on developing sales
department that helps in boosting the sale of company and also effectively present the consumers
regarding the requested products and services.
Description of the types of skills needed by employees to be able to work
effectively in these functional areas
Skills needed by Marketing employees
There are various skills which is required by marketing employees so that they can analyse
the market dynamics and increase the profitability of business. But the important skill which is
required with marketing employees are critical thinking and communication skills. It is necessary
for staff to have effective communication skills so that they can produce effective marketing
message and attract customers. They must also have critical thinking ability so that employees
can think out box and present their ideas differently (Ransbotham and Kiron, 2017). The
marketing employees of IOM must have these skills in order to organize marketing campaign
and reach to target market effectively.

Skills needed by Human Resource Management employees
Human resource employees must have problem, solving skills, decision making skills and
training and development skills. It is essential for staff to have problem solving skills so that they
can reduce the conflicts and manage the team effectively. Human resource employees also have
strong decision making skills so that they can hire new candidate on the basis of their
qualification and experience. IOM Electronics must have expertise human resource team with
these skills so that they can achieve the goals and objective of business.
Skills needed by Customer Service employees
Customer service employees generally have effective listening skills, ability to deal in
difficult situation and also have patience while interacting with consumers. They generally play
an important role in business as they directly interact with customers and influence their decision
to buy the products. They also focus on retaining staff by offering them high quality of products
and services with better customer experience (De Oliveira and et. al., 2016).
Skills needed by Research and Development employees
Research and development employees ability to think creatively and innovatively,
thinking and reasoning skills and also remain focused to detail. IOM must have strong research
and development team so that they can produce better ideas to improve the sale and productivity
of business. The research and development team must have creative and innovative thinking
ability so that they can offer unique products and services to consumers and enhance the
profitability of IOM Electronics.
Skills needed by Finance employees
Finance employees must have problem solving skills, mathematical proficiency and
analytical skills. It is important for finance team to have effective problem solving skills so that
they can handle the issues in cash flow statement and manage it efficiently. In finance, there are
large sums of money due to which it is necessary for staff to have mathematical proficiency
skills so that they can calculate the sums quickly. IOM Electronics must focus o hiring employee
who have these skills so that they can give productive outcomes in managing the cash flow of
organization.

Skills needed by Sales employees
The sales employees must have communication skills, relationship building skills and also
have ability to influence the decision of consumers. These skills help in improving the business
performance and also boost the productivity of organization. It is essential for IOM Electronics
to select the candidate in sales department who have strong communication skills and ability to
influence the decision making of customers (Ambrose, Matthews and Rutherford, 2018).
CONCLUSION
It is being concluded form the above information that organization must have strong
functional areas within business so that they can achieve the vision and mission of company in
effective manner. Each functional area plays a different roles and responsibility from others, it is
important for the company to hire the employees according to their specialization and interest so
that they can give their bets performance on achieving the target.

REFERENCES
Books and Journals
Ambrose, S. C., Matthews, L. M. and Rutherford, B. N., 2018. Cross-functional teams and social
identity theory: A study of sales and operations planning (S&OP). Journal of Business
Research, 92, pp.270-278.
Barkela, B., 2021. Leadership Communication with Multiple Managers and Its Influence on
Internal Integration of Different Functional Areas. In Conference Proceedings Trends in
Business Communication 2020 (pp. 1-18). Springer Gabler, Wiesbaden.
De Oliveira, E. A and et. al., 2016. Integration through cross-functional teams in a service
company. European Business Review.
Kasaev, B. S., Petrovskaya, M. V. and Kasaev, M. B., 2019. Innovative approaches to business
managing functional areas in a territory. Industrial Engineering & Management
Systems, 18(3), pp.440-453.
Monden, Y., 2019. Toyota management system: Linking the seven key functional areas.
Routledge.
Nalawade, R. K., More, D. K. and Bhola, S. S., 2019. Employability Skills Required for
Functional Areas of Management. IUP Journal of Soft Skills, 13(1).
Ransbotham, S. and Kiron, D., 2017. Analytics as a source of business innovation. MIT Sloan
Management Review, 58(3).
Shams, S .R and et. al., 2018. Strategic innovation management: A cross-functional vision to be
materialised. In Business Models for Strategic Innovation (pp. 1-10). Routledge.
Stawasz, E., 2020. Cooperation of enterprises in the functional area in the field of
innovation. Optimum. Economic Studies, 99(1), pp.22-33.