The interdependent nature of business - OCRMarketing interdependence, human resource & finance

Interdependence

Interdependence means that things depend on each other. In the business context this means that the four main functional areas of a business need each other in order to carry out their own responsibilities, and in order for the business to operate effectively.

The four main functional areas are marketing, human resources, operations and finance.

Marketing

The marketing function of a business is responsible for:

• identifying market segments
• undertaking market research to identify target customers
• making marketing decisions based on the marketing mix, which consists of:
  • product
  • price
  • place
  • promotion

Human resources

The human resources function of a business is responsible for:

• the organisational structure and how the business works
• communication within the business
• recruitment and selection
• motivation and retention
• training and development
• complying with employment law

Operations

The operations function of a business is responsible for:

• production processes
• quality
• how products are sold, eg online or in-store
• complying with consumer law
• location
• working with suppliers

Finance

The finance function of a business is responsible for:

• identifying suitable sources of finance
• monitoring revenue, costs, profit and loss
• calculating the break-even point
• cash and cash flow
• calculating the average rate of return so as to be able to advise on investment decisions

Each of the four areas needs the other areas in order to carry out its role.