Examples of Functions of Management

Examples of Functions of Management thumbnail
Successful managers increase profit and grow the value of the firm.

Management has several important functions in properly operating a company. The chief responsibility is to increase profits and grow the value of the firm. To achieve this goal, managers must ensure the sound financial management of revenue and expenses, enhance product offerings and conduct long-term strategic planning.

  1. Monitoring Expenses

    • One of the key functions of management is to keep expenses in line with budget expectations. This includes office supplies, marketing, advertising, travel, employee expenses, cost of goods, product development, taxes and all other business-related costs. These obviously directly relate to the net profit of the firm, with greater savings increasing profitability. Good managers make the judgment call about what expenses are necessary as a day-to-day cost, which expenses are a good long-term investment and which expenses can be eliminated.

    Product Development

    • Managers are also intimately involved in the process of updating and improving existing products, as well as adding new ones to the mix. Managers must make critical decisions about what features to add and how to apply them. Steve Jobs made one of the most famous product development decisions in recent years. As CEO of Apple, he made the final decision on the simple, clean and extremely appealing iPod product. Billions of dollars in sales later, it is remembered as a landmark decision.

    Sales

    • Sales is another important management function. Without sales, there is no business. Having an effective and motivated sales team is critical for growing the company. Managers must help sales people find leads, manage information, promote the product, negotiate contracts or prices and close deals. In addition, managers may use the feedback from customers that sales people provide to further enhance the product or service offerings of the business.

    Strategic Planning

    • Besides managing day-to-day operations, managers must think about the long-term future of the company. This includes financial management and budgeting. It also includes financing with debt or equity, issuing stock options and other capital structure questions. Finally, managers are responsible for new acquisitions or changing the direction of the firm. They do this by conducting an industry or competitive analysis and considering what they are lacking or could improve upon. In 2010, for example, managers at United Airlines and Continental Airlines agreed to merge. They believe that by combining their routes and operations, they could create a more efficient, powerful firm in the airline industry.

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References

  • Photo Credit manager image by Dmitri MIkitenko from Fotolia.com

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