Business Functions II

Finance: Represents long and short term requirements and requires optimal management of limited resources. 

Business finance: those business activities concerned with the acquisition and conservation of capital funds in meeting the financial needs and overall objectives of business enterprises.

Financial Managment: Task of providing funds needed by the business or enterprise on terms that are most favorable in the light of its objectives – almost exclusively concerned with procurement of funds, could include instruments, institutions and practices of fund raising; also includes legal and accounting relationship between a company and its sources of funds.
- Concerned with cash – everything that takes place in the conduct of a business (Broader term)
- Procurement of funds and effective utilization – widest accepted theory

Classification:

• Financing decision
• Investment decision
• Fixed capital management
• Working capital management 
• Dividend decision

Financial planning: Pre-estimating financial needs of an organization to ensure availability of adequate finance. Organization should be neither flush of funds or in shortage – right amount of finance at the right time.

Marketing: Process of determining the needs and wants of consumers and being able to deliver products that satisfy those needs and wants – including all activities necessary to move a product from producer to consumer.
Marketing mix: the ingredients/ tools/ variables that the marketer mixes to interact with a particular market; the set of tools the firm uses to pursue its marketing objectives in the target market.

• Product planning
• Pricing structure
• Promotion
• Packaging
• Distribution System
• Servicing

Marketing vs. selling: selling a narrower concept that involves transfer of goods or services from producers to consumers.

Basis	Selling	Marketing
Focus	Focuses on producers	On customers
Supremacy	Producer	Customer
Demand	Assumes demand for products	Demand generated for products needed by customers
Motive	Profit	Profits generated by customer satisfaction
Process	Exchange of goods for valuable consideration	Involving identifying and satisfying customer needs
Scope	Flow of goods to customer	Concerned with all activities that facilitate flow of goods to customers
Emphasis	Product disposal or sale	Product identification and development for customer satisfaction
Approach	Fragmented approach – sell all that’s produced	Integrated approach – identify and satisfy customer needs
Law	Caveat emptor – buyer beware	Caveat vendor – seller beware
Perspective	Short term with profit maximization	Long term – customer creation, satisfaction, growth and stability

Functions of marketing:

-          Aggregate of economic activities related to transfer of property right, selling and buying, transport and storage of goods, distribution, packaging, financing and procurement.

-          General and specific functions

-          General:

o       Marketing and consumer research

o       Permanent adaptation

o       Full satisfaction of demand

o       Maximizing of economic efficiency

Principles of marketing

1. Market knowledge

o       structure and dynamics of demand

o       Tastes and preferences of customers.
Produce what you can sell, not sell what you produce. 

Anticipation of consumer preferences – forecast of future market trends
Marketing for the company, not company for marketing – all resources need to be invested in the business, and staff to be motivated to adhere to the company’s general objective.

2. Human Resources
- Getting things done through people
- Essential part of every manager’s responsibilities
- Specialized division
- People most valuable asset
- Business must at all times be staffed correctly by the right number of people with skills relevant to the business needs.
- Human Resource Management (HRM) – Process of bringing people and organizations together so that the goals of each are met.
- Needs to be integrated with the overall strategy to ensure effective use of people and provide better returns to the organization in terms of Return on Investment (ROI) for every rupee spent on them.
Unfortunately, human resources tend to be undertrained and underutilized.

3. Services

1. Legal - rapid access to legal knowledge
2. Secretarial Functions - Conducting board meetings as required under companies act involving issuance of notices, drafting agenda, recording minutes and preparing reports/ corporate governance reports etc for listed companies, joint venture companies and other group companies; conducting GM for shareholders.
3. Accounting - Function of business that gathers data and information from all different aspects of business
4. Administration - Ensures that all the office work is completed and to ensure that paperwork can be accessed easily if necessary and sent to any people that need it.
Performance or management of business operations and the making or implementing of a major decision.
5. Information Technology - implementing modern tech to increase efficiency and profits