February 27, 2024

Functional Activities

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

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

What Are the 5 Core Functional Areas of a Business?

There are five primary functional areas. These are:

Management

Operations

Finance

Sales/marketing

Research and development

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

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