Monday 26 January 2009

What is the importance of an organizations functional areas to the strategic management process and why must the functional areas be integrated...

A
business's functional areas are the departments, teams or divisions (depending upon the
company's management structure) that oversee and implement the major functional areas of
business in a company. Most businesses share the major functional areas in common. Some
functional areas are marketing, accounting, customer service, and human resources. There may be
other functional areas such as, but not restricted to, international business and research and
development.

Strategic management planning comprises the four (sometimes
stated as five) steps involved in developing a strategic business or product plan. A strategic
management plan relies upon research data to analyze the market and
competitive environments for the business or product. This analysis is used to
develop a strategic plan of approach for progress toward the
company or product goal and objective. The plan developed is then implemented and
launched
in a community or larger market. The implementation is
evaluated for strengths, weaknesses, successes and failures. After
evaluation, the strategic management process starts all over again to incorporate observations
into a revised strategic plan to be implemented and launched in its
turn. 

It is easy to see that if any of the functional areas, for example
accounting and marketing, are left out of the strategic management planning process and not
integrated, then the efforts of the company are bound to fail
because integral functions of running a business and of successfully introducing a company or a
product into a community or a larger or more specialized market are bound to fail. For example,
if the accounting functional area is not integrated into the
strategic management plan, the cost of the plan may or may not be within the budget thus may or
may not be possible.

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