Functional Areas in Business: Skills and Employee Effectiveness

This report provides a comprehensive overview of the functional areas within business organizations, emphasizing the significance of each area for overall business success. It details the key functional areas, including strategy, marketing, finance, human resources, technology and equipment, and operations, illustrating their interconnectedness and importance. Furthermore, the report analyzes the essential skills employees need to effectively contribute to these functional areas, such as commercial awareness, communication, teamwork, problem-solving, leadership, organization, perseverance, and confidence. It underscores the importance of these transferable skills for employee performance and overall company efficiency. The report concludes by highlighting the need for interconnectedness among functional areas to meet business goals. This report is valuable for students seeking to understand the core components of business management and the skills necessary for professional success, providing insights into practical business applications and strategies.

Functional Areas
Author:

Table of Contents
Introduction....................................................................................................................................2
Various functional areas in business organisations....................................................................3
Types of skills needed by employees to be able to work effectively in functional areas..........6
Conclusion......................................................................................................................................8
References.......................................................................................................................................9
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Introduction
One of the objectives for dividing business processes into business functions is to enable each to
work within its area of competence, resulting in increased efficiency and effectiveness across the
company. The nature of the market and the size of the company influence the functional areas of
a company. Manufacturing businesses such as Nike and Apple, for example, have large R&D
teams to keep ahead of the competition in their respective business categories. Retail
organizations, on the other hand, may not have an R&D department, but they may invest
extensively in Supply Chain Management operations. Aside from that, various general
competencies and skills are required to carry out a business's functional tasks. These are
important employability abilities that enable a person to perform effectively in several functional
areas.
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Various functional areas in business organisations
While inaugurating a business, an entrepreneur must have a business plan. This plan includes
different strategies and functional areas regarding which an entrepreneur must know. Without
knowing these areas, an organisation may fail to implement its policies and operate successfully.
A good business plan helps an entrepreneur initiate a business by examining all functional areas
to handle business efficiently (Kasaev, Petrovskaya and Kasaev, 2019). Many new and existing
entrepreneurs failed to manage their businesses due to a lack of essential pre-planning in
functional areas. Statistics show that 80% of entrepreneurs failed within five years because they
lack pre-planning and their mismanagement in functional areas triggers such failure.
As a young entrepreneur, Jhon is acquiring a local electronics with some functional areas of
operation with 200 employees based over two sites in Manchester and Liverpool. Generally, the
six functional areas of a business include strategy, marketing, finance HRM, technology,
equipment, and operation. Therefore, John should focus on planning and develop an
understanding of these areas since they are indispensable for John's business. The six areas of
John's newly acquired business are as follows:
1. Strategy: An essential aspect of the business is called the "brain" of a business. Entrepreneurs
must formulate vision and mission statements to appreciate their goal, why they want to
accomplish it and how it will be accomplished. As a newcomer in the business, John needs to
assess the competitive landscape and market condition to identify opportunities for his business
and grab those opportunities. While formulating strategy, John should assess the electronics
products market and conduct a SWOT assessment on his competitors and business (Flynn,
2019). It will help him accurately picture where Jhon's business will fit in the competitive
landscape. It will help John identify and help his market access strategy that involves
positioning, differentiating from rivals and branding.
2. Marketing: As marketing and sales will yield revenue, entrepreneurs must know their
potential markets and identify means to access them. Marketing consist of all the activities that
an entrepreneur or business performs to determine customers needs and develop goods and
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services to meet those needs (Kasaev, Petrovskaya and Kasaev, 2019). Marketing activities also
involves promoting goods and services, developing product differentiation strategy to gain
competitive advantage. Since John's business is a technology and electronics business, he needs
to ensure his company's presence in the virtual world and promote it through social media such
as websites, blogs, Facebook, e-mail and campaign to grow business.
3. Finance: Almost all entrepreneurs focus on business since they need loans or investment to
establish a new project or new business. Money is the blood that helps to keep a business in
force. Without cash, it is impossible to start and operate a business. Since Jhon won a £10
million lottery, he will buy and maintain his acquired company. The other things he needs to
make predictions of cash flow are difficult to predict in the future (Flynn, 2019). In this regard,
Jhon should make an expenditure budget and estimate potential revenue. John can obtain deep
knowledge regarding finance from similar businesses and gather financial information for this
acquired business.
4. Human resources: Hiring appropriate people for business is probably an essential function of
a business (Aagaard, 2020). However, there's a lot to the workforce than just filling in the
headcount. John acquired an electronic business with its 200 employees. He needs to assess the
skills, experience, and qualifications of these people. If it is found that they are not capable, he
should hire new employees with these features. Along with recruitment and staffing, Jhon also
should focus on some significant HR areas like compensation and benefits, training and
development, labour and employee relations etc. The success of Jhon's business depends on the
performance of human resources, which is an asset for him.
5. Technology and equipment: It includes tools and technology needed to conduct the business
and communication, strategy, and business transportation. Entrepreneurs need to understand their
needs and satisfy budgeted demands (Kasaev, Petrovskaya and Kasaev, 2019). They should be
creative while managing technology and equipment. Since John's business is a technology and
electronics products based business, he should consider the technological aspect carefully.
6. Operations: Equipment alone is not enough to determine the success of a business. Operation
is also essential in this regard. Operations are those activities that help to produce and deliver
goods or services to customers (Aagaard, 2020). In the case of a new business or sole
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proprietorship, the owner performs the operational activities. But the thing he should bear in
mind is that he is managing the business, not doing a job. So as an owner, John should perform
his operation so that each task bears equal weight and products are accepted by customers.
Figure 1: Functional Areas of Business (Source Self-made)
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StrategyMarketingFinanceHumanresourcesTechnologyandequipmentOperations

Types of skills needed by employees to be able to work effectively in
functional areas
Employers emphasise searching and hiring those candidates who have skills and competencies
for their business. Depending on the organisation's operation and career sector, employees need
to develop skills, abilities, and knowledge to perform jobs in a functional area (Mertens, 2019).
Some general competencies and skills are essential to perform the functional task of a business.
These are known as crucial employability skills that help an employee to be able to work
effectively in functional areas. These skills are also called transferable skills. These are improved
over time and helps to develop the career of an employee. The top ten skills needed by
employees to be able to work effectively ib functional areas are as follows:
1. Commercial awareness: It is the knowledge of a business or industry how it moves and
serves in the market (Aagaard, 2020). Understanding what an enterprise wants to accomplish
through products and services and its financial goals is essential to performing its duty.
2. Communication: Communication includes verbal, written, and listening abilities. Clear,
concise, and focused communication abilities may tailor Jhon's employees' message to the
customers (Mertens, 2019).
3. Teamwork: An employee needs to demonstrate his team player able to handle and delegate to
others and take on liability to perform duties in functional areas (Serletis and Barnett, 2018).
Therefore, John's employees should build a positive relationship with everyone to achieve
organisational and personal goals.
4. Negotiation and persuasion: This is all about setting out what an individual wants to attain
and understanding where the other individual is coming from to get what they want or need and
feel optimistic about it (Mertens, 2019).
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5. Problem solving: Employees need to demonstrate the ability to accept a logical and analytical
approach to solve problems (Wendtland, 2017). Employees should possed the skills to solve
problems of functional areas from different angles.
6. Leadership: Leadership is essential to motivate employees and supervise all aspects of an
organisation (Wendtland, 2017). Employees need to display their potentials to motivate the team
and peers who work with them. John's employees should assign and delegate tasks, meet
deadlines and lead in a well-groomed way in all functional areas.
7. Organisation: It is all about demonstrating priority, efficiency, productivity and management
of organisational tasks. Employees need to show their employers that they can organise, focus,
and meet deadlines (Serletis and Barnett, 2018).
8. Perseverance and motivation: Employers recruit people who are diligent and self-motivated
(Wendtland, 2017). A real-life workplace is a bit difficult, and employees need to show
perseverance while working with colleagues and employers. They also need to be self-motivated
in their workplace.
9. Ability to work under pressure: This is about remaining stable in a crisis not becoming
overwhelmed or worried in different situations (Wendtland, 2017). Jhon's business may face ups
and downs. But skilled employees remain the same in all situations, and they know how to deal
with such situations.
10. Confidence: Confidence is vital for employees to perform their functional duties. If they are
confident enough, employers delegate them with authority and reward them for their positive
performance. Employees confidence is also crucial for their colleagues and teammates (Serletis
and Barnett, 2018).
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Conclusion
The primary goal of functional areas is to ensure that all critical business tasks are completed
effectively. This is necessary if the company is to meet its goals and objectives. Furthermore,
particular regions will be in charge of assisting with specific sorts of goals and objectives.
Furthermore, business functional domains are interconnected. Sales must be aware of production
plans and agree with Production on order delivery dates so that customers are not promised dates
that cannot be met, Production must inform Sales of production issues that consumers, Finance
must be aware of customer inquiries so that their credit rating can be checked before sales occur,
and HR is in charge of job openings, promotions, and training programs. Employees are critical
to a company's success since they can't do day-to-day tasks without transferable skills and a
thorough understanding of the job. As a result, the sorts of abilities that employees require to
perform functional tasks are shown here. To maintain efficiency and effectiveness in a firm,
functional sectors are required. Efficiency in employee work, on the other hand, is critical for a
successful business.
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References
Aagaard, A., 2020. Business Functions for Sustainability. 2nd ed. Gistrup, Denmark: River
Publishers.
Armstrong, M. and Landers, R., 2018. Gamification of employee training and
development. International Journal of Training and Development, 22(2), pp.162-169.
Flynn, P., 2019. The Functional Areas of Business. 3rd ed. New York: Business Expert Press.
Kasaev, B., Petrovskaya, M. and Kasaev, M., 2019. Innovative Approaches to Business
Managing Functional Areas in a Territory. Industrial Engineering & Management
Systems, 18(3), pp.440-453.
Kirstein, R. and Will, B., 2019. Efficient compensation for employees' inventions. 3rd ed.
Saarbrücken: CSLE.
Mertens, D., 2019. The Employer's View of Research and Evaluation Skills. 2nd ed.
Serletis, A. and Barnett, W., 2018. Functional structure inference of Business. 4th ed.
Amsterdam: Elsevier.
Wendtland, D., 2017. Strategic Training of Employees. 4th ed. Amherst: HRD Press.
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