The Core Functions within the Business - Term Paper Example

Entrepreneurship Introduction In the recent years, agriculture business has assumed a greater importance not only in thedevelopment and commercial agriculture internationally but also in developing and subsistence type agriculture. Therefore, a farm manager must not only understand the methods of agricultural production, but also the main key management tools that would results to the profits he or she needs. Since successfully managing a farm, business is certainly the main goal of a farm owner. Farm management deals with the organization and operation of a farm to maximizing profits from the farm business continually; thus a farm manager needs to adjust his or her farm organization time by time to keep abreast of changes in methods of farming, prices variability, and the available resources among other factors. This means that for a farming business to succeed, a manager should, therefore, develop core functions to secure the success of the business. Some of the main functions that should be developed, in this case, a coffee farming business, include internal, external, and support functions (BROWN, 2008, p. 53-56). This paper will, therefore; discuss the roles and responsibilities of these functions and the significance of the functions to the sole traders and SME’s in the success of their businesses. Identify the core functions within the business and explain their roles and responsibilities First, internal functions consist of all necessary and essential business activities that help lay a foundation for a business. They are, therefore, required to continue the business objectives that are established by the business owner during an establishment of a business. Internal functions are also needed to continue the regular activities of a business and examples of the internal functions acquisition of finance, hiring of labour, purchasing raw materials, overhead expenses, and production of goods. In a coffee farming business, acquisition of finances is important since it will need high capital at the start-up and the running of the farm activities. Finances can be acquired from investors, banks, and other financial institutions and resources can be channelled to initiate some of the preliminary activities such as purchasing machineries such as processing plants, buildings, and land. Once this is done, the farm will need labour; people who will help cultivate the land, planting coffee and making sure the coffee plants are a conducive environment to grow. Additionally, the business also requires a management team, who will carry out function such as controlling the overhead expenses, controlling the production of coffee, and establishing a supply chain (BROWN, 2008, p. 53-56). External functions are other important aspects of the coffee farming business. These functions consist of all activities carried out outside the business and which promote the goods a produced by the business. It is in this case, the responsibility of the sales manager to forecast, plan, and control the external functions of a business. The main external functions that would fit in a coffee farming business include selling, distribution, and marketing research. First, market research is an important function in the coffee farming business since it will help explore and find out the market needs, which market for the coffee it, will be profitable. The information collected from the market is analysed carefully by the top-level management to ensure the future growth of the product in the market. The sales function, on the other hand will help establish the connection between the business and the final consumer after the coffee is processed to its final product. In this case, there will be sales promotion of the final product and advertisement as a way of informing the final consumers about the product (BROWN, 2008, p. 53-56). Finally, distribution, an activity in external function, ensures that the final product gets to the consumers. Therefore, the distribution channel will be as follows considering it as a large-scale production: Manufacturer to wholesalers (supermarkets, mall, and exporters) to the consumers. For small-scale production of the coffee, the suitable distribution would be; from manufacturer to the wholesalers to retailers and to the final consumers; this is important when the manufacturer wants to sell the product to a wide client range. Alternatively, the farm owner can establish selling points where they can sell directly to the final consumers; this would help reduces the distribution cost. Conclusively, external functions help the business penetrate the market and gain a position where the product will be profitable (BROWN, 2008, p. 53-56). Support functions are third major function helpful to coffee farming business, and they consist of those activities that facilitate and ensure smooth working of both external and internal functions of the business (BROWN, 2008, p. 54). These functions are taken up the management in cases where they would need information that they would utilize to take strategic decisions regarding external and internal functions. Some of the functions applicable in a coffee farming business include accounting operations, quality control, human resources services, and business process outsourcing. Accounting operations are an important part of the business since the function is required for recording and transacting daily financial transactions of the business. For example, sales, expenses, purchases, and incomes among others, thus, it help the management know the profitability and sales turn-over of the product (BROWN, 2008, p. 53-56). Quality control in turn, helps assess the inputs and outputs using some pre-determined standards. This function helps take care that the produced coffee re n accordance with the established standards set by the business also in the distribution of quality goods to the consumers. Business process outsourcing helps the business outsource some non-productive works needed in the business, for instance, preparation of payrolls and taking consumer complaints. Finally, in the support function, there are the human resources services that are helpful to the management in employing suitable employee for available positions in the business. In this case, there is the establishment of a panel who will determine the eligibility of a candidate for the position (BROWN, 2008, p. 56). Explore the significance of core business functions within SME’s and sole-traders Small and medium-size enterprises and sole-traders are businesses that do not have several business functions in them since they are management by a small management. Therefore, in the internal functions of the business, the main activities that would be helpful to a sole-trader or SME business include hiring labour, acquisition of finances, and overhead expenses (WESKE, p. 42). The main significance of the activities is that they carry on the business objectives decided at the time of the business establishment. For instance, the management must understand the cost incurred while operating essential business activities. Without this activity in the internal functions, a business is likely to suffer a risk of collapse; also, establishing a stable source of finance, or methods that can be used to acquire funds is also an important activity to the sole-trader and SME business. Therefore, internal functions are an important aspect of a business especially the SME since they lay the foundation both during start-up and during running of the businesses (WESKE, 2012, p. 41-45). Establishing strong external functions in SMEs and sole-traders helps the business seek profitable opportunities in the market. For instance, market research, advertisement, sales promotion, and selling and distribution are fundamental aspects to SMEs. Doing a market research on a suitable ground for establishing business and the market segment where products will be sold is important when a business needs to make strategic decisions, for instance, on the methods of market penetration and sustainability. Marketing activities has been termed from the past as activities that help a business product and services known to the consumers such activities include advertisement and sales promotion. Marketing helps a business sustain a competitive advantage, but SMEs and sole-traders lack the finances to market their products, however, with enough finances, external functions can help SMEs run their activities smoothly despite the competition (FOX, 2009, p. 77-80). On the other hand, the problems in maintaining a competitive advantage over other businesses in the corporate industry faced by the SMEs and sole-trader businesses have become a major concern in the recent past. Several businesses are adopting technologies and best practices to support the rapid change in the business world (FOX, 2009, p. 77-80). Support functions such as accounting operations play an important role in businesses to maintain a competitive advantage. However, SMEs and sole-traders face a problem in handling their accounting functions due to lack of knowledge of general accounting rules and their application to a business. That is why establishing stable support functions in business become a significant aspect in successfully establishing a competitive advantage in the market. Outsourcing is another significant activity in the support functions to a SME or a sole-trader business, for example, outsourcing accounting practices and technology among others. Outsourcing is helpful since it helps SMEs focus on income-generating activities of a business such as acquisition of finances, distribution, sales, production of goods, and advertisements. Primarily, support functions generally help the business focus more on the internal and external functions that stabilize businesses in a competitive market (WESKE, 2012, p. 41-45). Summary and recommendations Small businesses owners frequently make the mistake of creating jobs for people they have rather than putting employees into positions the business needs. To properly staff and run a business, creating an organization chart that, incorporates the primary business tasks any company must be available to help maximize its success. Therefore, creating working business functions, that is internal, external, and support functions, can enable a business acquire the market stability it needs also sustain a competitive advantage. I would recommend that, SMEs and Sole-traders business outsource some of the activities so that they would concentrate more on the activities that would be beneficial to the businesses. References BROWN, S.P., 2008. Business Processes and Business Functions: a new way of looking at employment. Monthly Labor Review, 131(12), pp. 51-70. FOX, W. M. 2009. The management process: an integrated functional approach. Charlotte, N.C., Information Age Publishing. WESKE, M. 2012. Business process management concepts, languages, architectures. Berlin, Springer. Read More