Study Notes

Functions in a Business (GCSE)

AQA, Edexcel, OCR, IB

Last updated 22 Mar 2021

Once a business has been properly established and has taken on a reasonable number of employees, the organisational structure will involve the business being splits into number of different departments, each of which has a specific job or task to do - these are called 'functions'.

The main functional areas of a business are outlined briefly below:

Human Resources / People

What it does:

Responsible for all aspects of managing the people who work in a business.

Main activities:

Organise hiring employees (recruitment)

Set up and manage employment rules

Organise employee training & appraisal

Monitor the working conditions for employees

Manage communication with staff

Ensure business complies with employment-related legislation


What it does:

Responsible for understanding the needs and wants of customers

Main activities:

Research into the market

New product development

Development and delivery of promotional campaigns

Setting and monitoring prices

Ensuring suitable distribution

Obtaining and auctioning customer feedback

Production / Operations

What it does:

Organises the transformation process that turns inputs (e.g. materials, people) in finished goods and services

Main activities:

Organising suitable method of production

Controlling the use of inputs to produce efficiently

Managing the quality of finished output

Accounts / Finance

What it does:

Manages the financial resources of the business and reports on the financial position & performance

Main activities:

Allocating and monitoring the use of financial resources through budget

Ensuring business has sufficient cash to enable it to pay its liabilities as they fall due

Reporting on financial performance

Ensuring business meets legal requirements re financial reporting

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