Business functions Flashcards
Purpose of the eight business functions
Work together to achieve business goals
Each function carries out specific functions linked together to achieve business goals
Roles and tasks may change depending of growth of the business
Work together to ensure survival and sustainability of the business
Importance of general management
Sets direction
Leads, organizes and controls other functions
3 different levels
Level of management
Degree of power and authority mangers possess
Top level management
Long term strategic plans
Leads, controls and manages tasks
Determine mission, objectives and strategies
Middle level management
Medium tactical plans
Responsible for specific departments in the business
Implements visson and plans from top level
Lower level management
Short term tactical decisions
Follow instructions from middle level
Productivity, support and motivation
Role of top level management
Plans for the future
Manage change in the business
Plan businesses activities
Roles of middle level management
Link between top and lower level management
Pass information from top to lower level management
Carry out strategic plans
Role of lower level management
Make routine activities
Plan daily activities
Motivate and guide employees
Management tasks
Planning
Leading
Organizing
Controlling
Risk management
Planning
Sets goals develop strategies
Tactical plans implement choose plan
Consider different plans
Organizing ting
Execute plan
Requires training to make sure job is done successfully
Ensures people know what is expected of them in terms of authority
Organize jobs
Leading
Motivate and guide others to achieve goals
Inspire employees to do tasks
Guide employees in the right direction
Controlling
Ensure business achieves goal
Ensure standards are met
Ensure activities are carried out as planned
Risk management
Identify risk bearing activities in the business
businesses analyze risk and when it’s likely to happen
Evaluate potential risk impact on business
Handles risk using risk contingency plan
Administration function meaning
Stores/records information using latest technology
General office work such as filling and storing information
Activities of administration function
Collecting
Handling
Office work
Information technology
Collecting information
Information is collected outside and inside the business
Info is correct, reliable and available
Handling information
Handle information with care to avoid making wrong decisions with wrong information
Types of information in admin
Accounting records
Cost accounting
Bugbet
Statistics
Information technology
Electronic information is used to communicate and handle information
Office practice
Admin handles thier staff
Dress code
Proper filling of documents
Data
Raw/unprocessed facts
Can be processed manually or using technology
Information
Processed/analyzed data
Stores information on electronic devices
Financial function
Planning and managing funds
Purpose of Financial function
Establish sources of capital
Ensures business generates income to cover capital and rising capital
Reasons why we need finance
Find best investors
Source of funding
Bank loan
Money borrowed from the bank that must be repaid with interest
Bank overdraft
Spending money which isn’t there that must be repaid with interest
Asset based loans
Loan used to purchase assets until it’s fully paid
Grant
Money given to local business by government
Receiveable loan
Loan given to business while waiting for payment of goods and services
Angel funding
Money offered by wealthy entrepreneurs to other businesses for a share in the business
High risk investment
Venture capital
Money offered by individuals or organizations to start or expand a business for a position of the board of directors in the business
Budgeting
Planning tool that is used to determine how money received will be spent
Capital budget
Fixed capital drawn up every 5 to 10 years
Cash budget
Working capital drawn up at the end of every financial year
Investments
Invest money to generate profits
Fixed capital
Long term assets business need to operate
Working capital
Money used for day to day businesses operations
Owned capital
Owner provides capital
It is not a liability
Borrowed capital
Money obtained from financial institutions
It is a liability
Purchasing function
Buying raw material and services for the business
Look for suitable, new and better supplier
Ensure goods are delivered at agreed price, right quanties and quality
Purpose of the Purchasing function
Mange stock level
Continuously look for the best suppliers
Send damaged goods back
Contact other departments to determine their needs
Negotiate best possible payment
