Operations Within the Business

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The three main functional activities in a business are:
operations
sales and marketing
Finance.

The sales and marketing function work to find and create demand for the company's goods and services by understanding customer needs and developing new markets. The need for marketing and operations to work closely together is particularly important as the marketing function will provide the forecast of demand from which operations can plan sufficient capacity in order to deliver goods and services on time. The finance function is responsible for the obtaining and controlling of funds and cov¬ering decisions such as investment in equipment and price-volume decisions. Other functions which play a supporting role in the organisation include the personnel function which will play a role on the recruitment and labour relations, the research and development R&D function which generates and investigates the potential of new ideas and the information technology (IT) department which supplies and co-ordinates the computer-based information needs of the organisation. The relationship between functions can be seen as a number of sub-systems within the system called the 'organisation'. Thus each function (e.g. marketing) can be treated using the same input/process/output transformation model as the operations function. In other words each function within the organisation can be treated as performing an operations activity, as they are transforming inputs into outputs. This implies every part of the organisation is involved in the operations activity (to an external or internal customer) and thus the theory of operations covered in this book is relevant to them. When oper¬ation is cited as a function in itself however it is referring to the part of the organisation which provides goods and services for external customers. The operations function itself is involved in all parts of the firm and thus has a major impact on the competitive position of the organisation. The...
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