Scope of management specifies the organisational functions in which management is relevant. Organisational functions differ from organisation to organisation depending on their nature while functions of management are the same in all the organisations.

In a business organisation, organisational functions are divided into four categories: production, marketing, finance, and human resource.

These organisational functions are called functional area of management and have their own strategies, policies, procedures, etc.

In referring to these functional areas, the term management is suffixed with each functional area like production management, marketing management etc.

Production Management-

Production management involves planning, organizing, directing, and controlling the production function so as to produce the right goods, in right quantity, at the right time, and at right cost.

It includes the following activities:

  • Location and layout of plant and building.
  • Designing the product.
  • Planning and control of factory operations.
  • Purchase and storage of materials.
  • Repairs and maintenance of plant and other related assets.
  • Inventory, cost and quality management.
  • Research and development.

Marketing Management:

Marketing management involves identification of customer’s needs and supplying them the products (goods and services) which can satisfy the needs.

It involves the following activities:

  • Marketing research to determine the needs and expectations of the customers.
  • Planning and developing the suitable product.
  • Setting appropriate prices.
  • Selecting the right channel for distribution.
  • Undertaking promotional activities like advertising, sales promotion, and personal selling to communicate with the customers.
  • Customer relationship management.

Financial management:

Financial management involves ensuring the right amount and type of funds to business at right time and at reasonable cost.

It includes the following activities:

  • Assessing the volume of funds required for both long term and short term needs of the business.
  • Selecting the appropriate sources of funds.
  • Raising the required funds at the right time.
  • Ensuring the proper allocation and utilization of the funds so as to maintain the safety and liquidity of the funds and the creditworthiness and profitability of the business.
  • Appropriation of earnings.

Human Resource Management:

Human resource management involves recruiting and employing right type of personnel, developing, retaining and integrating these personnel with the organisation to achieve desired objectives.

It includes the following activities:

  • Human resource planning.
  • Recruitment and selection.
  • Training and development of the employees.
  • Performance appraisal.
  • Promotion and transfers.
  • Compensation.
  • Employee welfare services.
  • Industrial relations.
  • Human resource records and research.

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