Functional Areas in Business: Importance and Skills Required

This report discusses the importance of functional areas in business and the skills required by employees to work effectively in these areas. It focuses on IOM Electronics Ltd and its four major functional areas: marketing, human resources, operations, and finance. The report also highlights the skills required in each department, such as creativity in marketing, communication skills in human resources, planning in operations, and analytical skills in finance.

Functional Areas

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Various functional areas in the organisation...............................................................................1
Skills required by the employees in order to effectively work in these functional areas ...........3
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Functional areas in business are essential as they ensure that the important activities in
the business are performed effectively and efficiently. This helps the business in achieving the
objectives that the business aims to achieve by running the operations (Carnall, 2018) . Different
areas ensure that there is no confusion between the authority and responsibility associated with
the employees. The set of tasks are assigned according to the functional areas and in these
functional areas people with respective expertise are hired. In this report, IOM Electronics Ltd is
considered which is based in two cities that is Manchester and Liverpool with more than 200
employees. This report revolves around the importance of various functional areas in IOM
Electronics Ltd and the skills that are required in the employees of the organisation in those
respective functional areas.
MAIN BODY
Various functional areas in the organisation
Functional areas are divided according to the tasks and job, they are made in order to
divide the work according to the expertise of the employees. The policies and budgets in the
business are made according to the functional departments (Ismail, Khater and Zaki, 2017).
Every industry requires different functional areas but there are four major areas that are required
and essential in every industry. These four functional areas are discussed below in context with
IOM Electronic Ltd:
 Marketing Department- This department deals with the needs and wants of the potential
customers, this department is responsible for promoting the product. They have an
obligation to make a good brand image of the products or services of the organisation.
They generally analyses the market conditions and work according to the different
strategies (Trieu, 2017). In context of IOM Electronics Ltd, John must work on
developing a good marketing team as they will promote their electronics products in the
market. The marketing team of the organization will be responsible for the performing
the following tasks in the organisation:
Market research- This refers to conduction market surveys in order to analyse the need of the
consumer, this help the organisation in minimizing the wastage of resources and maximizing the
productivity.
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Promotion- This refers to technique that are used in order to attract the customers in the
organisation. Marketing team is responsible for choosing the best method of promotion so that
the organization can build a customer base for their products and services.
Selling product- The marketing department is responsible for increasing the sales revenue of the
firm, this could be done by pitching and improving the packaging of the material.
 Human resources- This department is responsible for managing the human resource
department in the organisation. In context with IOM Electronics Ltd, they have an
employee strength of 200 which needs to be managed and maintained. The functions of
this departments are discussed below:
Recruitment and selection- This is one of the major task of human resource manager as they
recruit new people in the organisation (Pedersen, Gwozdz and Hvass, 2018). The process of
recruitment and selection is vast as it contains a lot of steps. Recruitment is a time and resource
consuming process, this helps in acquisition of good employees in the company.
Staff training- This is responsibility of the human resource manger to train the existing staff of
the organisation. They are provided with required modules and practices so they can learn the
skills. Staff training helps the organisation in increasing the overall productivity at work as due
to this the employees apply different learnt techniques in their day to day job.
Health and safety- Establishing a healthy working environment in the organization is an
essential task of the human resource manager. They ensure that the staff working in the
organisation is healthy.
 Operations department- This department manages the operational activities of the
organisation which is production management. In context of IOM Electronics Ltd, their
production of electronics need to be managed by a functional group. The functions of this
department are discussed below:
Production of goods and services – This is the major task of the production department they
manage all the production related activities in the organisation. In context of IOM Electronics
Ltd, their operational department is also responsible for providing the repair services of
electronics.
Buying raw material- The production can only be executed if there is raw material to produce
the goods (Linnenluecke, 2017). Operations department is responsible for managing the quality
and quantity of the raw material.
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Control of quality- Operations department is entitled to manage the quality of the material that
is produced by the organisation. The service quality assurance is also performed by this
department.
 Finance department- Every organisation's main objective is to generate and maximize
the revenue. This can only be possible by the finance team as they manage all the
monetary values of the organisation (Amarakoon, Weerawardena and Verreynne, 2018).
They are hired in the organization to allot the funds to different functional areas. Finance
team estimates and manages the fund that is required by these departments. In context of
IOM Electronics Ltd, they need to have finance to manage the books of the company.
Finance team will manage the revenue according to the profit generation from different
product line and services. Few of the functions of finance department are as follows:
Preparing budgets- Anticipating the expenditure and the revenue from the operations in
organisation is very essential to gain some perspective of the future of the business. This
document is prepared by the finance team for individual projects and for the organisation as
whole.
Ensuring enough cash flow- The optimal task of the finance team is to ensure that the company
has enough cash flow to meet the current obligations of the business. This will help IOM
Electronics Ltd in maintaining a good cash flow that will meet the liabilities and assets of the
business on time.
Preparing final accounts- These documents are prepared by the finance team to calculate the
exact amount of expenses and incomes incurred during the financial year. This is important for
the company as it accounts the profitability of the business.
Skills required by the employees in order to effectively work in these functional areas
Skills required in the marketing department:
Creativity- This is one of the most important skill as the advertising and promotion part requires
the individuals to think out of the box in order to create extra ordinary promotional techniques
(Shah, 2021). In context of IOM Electronics Ltd, they need to hire creative people in the
marketing department so the promotion of products would be extra ordinary than the rest of the
electronics company. The human resource manger also needs to develop the creative skills of the
existing workforce.
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Skills required in the human resource department:
Communication skills- This is one of the most essential skill as a human resource manager as the
daily activity of these people include interaction with the human work force. They should be able
to convey the proper messages to the team so that employees get a clear understanding of the
tasks.
Skills required in the Operations department:
Planning- This is one of the major task of the organisational team as they need to plan the
resources and the operations in production. In context of IOM Electronics Ltd, their operational
team need to manage the resources of electronic so that the production can be effective and
efficient. Planning helps in reducing the wastage of resources and developing a sincere behaviour
in the operations of the department.
Skills required in the Finance department:
Analytical skills- This is important as the finance team need to manage the monetary terms of the
organisation. The finance department needs to develop this skill as it helps in analysing the
books of the business. In context of IOM Electronics Ltd, they need to hire people with
analytical skills in this department as this will help in maintaining the accounts of the
organisation.
CONCLUSION
By above discussion it can be concluded that the role of different functional department in the
organisation is very essential. Every department is assigned with different kind of tasks and these
tasks are executed accordingly by the employees. This division of functional areas help in
ensuring a smooth flow of operations in the organisation. Every department requires different
skills sets to bring efficiency in the employee. These skill sets help the individuals to contribute
to the organisation goals as a whole.
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REFERENCES
Books and Journals
Amarakoon, U., Weerawardena, J. and Verreynne, M.L., 2018. Learning capabilities, human
resource management innovation and competitive advantage. The International Journal
of Human Resource Management, 29(10), pp.1736-1766.
Carnall, C., 2018. Managing change. Routledge.
Ismail, M. H., Khater, M. and Zaki, M., 2017. Digital business transformation and strategy: What
do we know so far. Cambridge Service Alliance, 10, pp.1-35.
Linnenluecke, M. K., 2017. Resilience in business and management research: A review of
influential publications and a research agenda. International Journal of Management
Reviews, 19(1), pp.4-30.
Pedersen, E. R. G., Gwozdz, W. and Hvass, K. K., 2018. Exploring the relationship between
business model innovation, corporate sustainability, and organisational values within the
fashion industry. Journal of Business Ethics, 149(2), pp.267-284.
Shah, D., 2021. Co-operatives and Agricultural Marketing in India: Structure, Progress and
Functional Dimensions. Progress and Functional Dimensions (May 8, 2021).
Trieu, V. H., 2017. Getting value from Business Intelligence systems: A review and research
agenda. Decision Support Systems, 93, pp.111-124.
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