Question

Critically discuss the relationship between the three major functional areas (Operations Management, Finance and Marketing) within any given organisation. What motivates the operations manager to maintain a sound interrelationship between these functional areas? Motivate your answer fully.

Answer 1

In any organization, the areas of operations , marketing and finance are highly interrelated. The operations area of management mainly deals with the production of goods and services, the finance area relates to the sourcing and usage of funds in the organization and marketing mainly deals with the activities that drives the flow of goods from producers to consumers.

The marketing department helps in identifying the needs of the customers through marketing research. It identifies the type of products the firm should produce and the quantity the firm should produce in order to meet the needs of the consumers. Once the product to be produced is identifed, the operations area of the organization is responsible for managing and supervising the production process so that the required number of units are produced . The finance area of the organization helps in sourcing the funds required for the marketing activity as well the operations activity. The budgets prepared by the marketing team will help the finance team to acquire the required funds and once the funds are acquired, it overlooks the usage of funds. The operations area budget will provide inputs regaring how much financial assets would be required for the production area and the same will be allocated to the operations area of the management.

Thus the three area are closely interrelated and each area requires close coordination with other areas for the organization to operate smoothly.