Three Functions of a Business: Everything You Need to Know
Check out these three functions of a business that will lead to your success.3 min read
2. The Importance of Finance
3. The Importance of Marketing
The three functions of a business that lead to success include:
- Creating a product or service that people desire.
- Developing a plan to make money by selling this item.
- Pushing yourself and your team to manufacture the product and sell it before you run out of your initial investment.
To do this, you'll need three kinds of people on your team: thinkers, marketers, and pushers.
- Thinkers come up with new ideas based on their thorough understanding of the market. They understand your ideal customers and their shopping habits.
- Marketers focus more on the mechanics of getting word out about your product. They have a thorough understanding of the product and how to promote it to your customer base.
- Pushers are basically the leaders of the group. They'll motivate the thinkers and marketers to do a good job and achieve their goals.
Other important aspects of a business also contribute to its success.
The Importance of Communication
Communication is key to keeping relationships between co-workers, staff, customers, company representatives, and management steady and reliable. With clear and open communication between parties, you won't be able to manage your business efficiently. For example, a manager must be able to communicate effectively to his or her staff to make sure all the workers understand their job responsibilities.
Other important aspects of communication include:
- Job control, which dictates how an employee should act while on the clock. An example of this might be a job description or company policy. These might be communicated through graphics that note the hierarchy within the organization, written company policies that explain how employees should act, or an employee handbook that notes how to request vacation time.
- Decision-making, in which managers seek input from other employees when making decisions for the company. An example of this is if the product department informs the manager how many products they are making in a certain period. If they weren't able to meet their goals, the manager might hire more workers to help meet demand.
- Motivating employees using either written or verbal feedback. For example, a manager might provide workers with performance evaluations that show their strengths and motivate them to meet higher standards. You can also provide employees with rewards, incentives, and helpful criticisms.
The Importance of Finance
Finance is a crucial part of any business, as it is how a company gets the money it needs to operate. Those in charge of finance for a business will make purchases for supplies, goods, and other services needed to produce, distribute, and market the product. Other things the finance branch of a business must focus on include:
- Estimating revenue and profits.
- Budgeting expenses.
- Forecasting costs, losses, and debt.
If your business wants to stay competitive, you must put a significant focus on its finances. Many companies choose to utilize investment strategies that offer a short-term yield without excess risk.
An example of this is Amazon.com. While it's a thriving business today, Amazon originally made money by investing the profits from book sales before handing the money over to sellers. Because Amazon had a policy of holding onto transaction funds for 30 to 60 days after the sale, the company could invest the money during this period and keep any return on the funds before distributing the original amount to the seller.
The Importance of Marketing
Without marketing, you probably won't have customers. Your marketing team's goal is to make your customers believe your products will meet their desires and needs. It's also the marketing team's responsibility to know the customer's needs. This allows you to customize your product to meet your target demographic's wants.
Marketing is all about strategizing how to best create awareness about your product. Any advertisements or campaigns to tell the world about your items will be spearheaded by the marketing team. For example, if you sell candy, the team will be responsible for brainstorming creative ideas, such as promoting your candy at a video rental store or movie theater to boost its appeal and improve the customer experience.
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