Business Administration Functions

Functions of Business Administration

• Administration is a systematic process involving activities oriented towards a specific goal.
• The core activities within this process are: planning, organization, human resource management, direction, and control.

Planning

• Planning sets the objectives to be accomplished and develops plans plus programs to assist in that achievement.
• Strategic plans look long-term.
• Tactical or functional plans focus on the medium-term.
• Operational plans have a short-term scope, usually around a year.
• Strategic, tactical, functional, and operational plans define the path for fulfilling the organization's mission and goals.

Organizing

• Sets up a business's organizational structure including defining tasks, outlining responsibilities, grouping tasks, and determining reporting structure.
• The organizational structure should clearly detail who carries out specific tasks and is responsible for the outcomes.

Directing

• Administrative direction involves influencing individuals towards achieving organizational and group goals.
• The objective of administrative direction is to properly integrate people into the organization including finding the right person for the job (selection process), promoting mutual adaptation between the individual and the organization, and supporting the individuals growth within the organization.

Controlling

• Control is the concluding function in the management process, linking organization, staffing, and direction to planning objectives.
• It ensures business action is effective, enabling feedback to align operations with objectives.
• Control involves systematically setting standards, measuring progress, and taking corrective actions.

The control process unfolds in four steps

• Establishing performance standards, derived from planning objectives, must be specific and measurable.
• Measuring the actual performance via economic and reliable methods.
• Comparison of real performance against defined metrics.
• Taking remedial actions if deviations exceed allowable limits.

Strategic Analysis

• Strategic analysis aims to assess a company’s performance
• Steps involved including strategic formulation, implementation, and evaluation.

Stages of Strategic Analysis

• Begins with defining the company's mission, values, and objectives.

• Conduct a thorough analysis of three key elements including the external environment (identifying threats, opportunities), the internal aspects of the company (strengths, weaknesses), and the social situation with stakeholder interests.

• Once the analyses are complete, you move into strategy formulation at different levels depending on the focus on business operations.

• After formulation comes the implementation phase that involves structuring both organizational and cultural aspects.

• The process continually retro feeds to identify potential improvements and adjust the strategy accordingly.

Establishing the Mission, Vision, Values, and Objectives

• The primary goal of a company to define its core purpose, scope, and societal role is the "mission of the company."

• The mission defines the path and limitations.

• "Vision" is the company's aspirations or what it hopes to become in the future.

• To define the mission, determine the offerings, target audience, and business marketplace

• Evaluate the company's vision by considering future aspirations and desired perception.

• The mission provides direction, the vision outlines a long-term goal.

• Besides values, a company must define a consistent approach to operations as a guiding reference when making decisions.

• Values must be shared and ingrained within the organization.

SMART Objectives

• Objectives should be "intelligent" – or SMART.
• Specific (clearly defined goal), Measurable (how success is gauged), Achievable (realistic to attain), Realistic (considering time and resources), Timely (deadline to achieve).

Environmental Analysis

• Considers every factor surrounding and influencing the organization.
• Determines the suitability of the analysis for the specific company.

Nature of the Environment

• Establishes the necessary scope and depth of the analysis based on its characteristics including stability (static vs. dynamic analysis), and complexity/diversity.

Levels Competitive Environment

• Variables affecting an organization on both global and sector-specific levels. Global factors call for a general environmental analysis, while sector-specific issue mandates a more targeted approach.

Generic Environment Analysis (PESTEL)

• Analyzes the variables related to the "country effect."
• Examining how localization factors affect competitiveness and present opportunities or threats.
• PESTEL framework encompasses evaluation of political, economic, socio-cultural, technological, ecological, and legal aspect affecting a company.

Specific Environment Analysis (Porter's 5 Forces)

• Focuses on a sector-specific analysis.
• Evaluates internal analysis, including competitors, clients, and vendors, to determine the external factors to prioritize.

Competitors In Sector

• Focus on companies that fulfill the same customer needs.
• Online as well as offline, competition should be analyzed based on competitors number, sector growth, differential of products, plus barriers for sales.

Potential Competitors

• All the companies that are not competing in the sector but could be.
• Consider obstacles to entry, product differentiation, legal as well as administrative regulations, and investment requirements.

Substitute Products

• All those products that addresses our same customer needs, even if different.
• Important factors include grade substitution, product and price differentials.

Negotiating Power of Providers

• Analyze the power that sector providers have.
• Consider number of providers, size and grades differentiation of the product and provider change fees

Negotiating Power of Clients

• Analyze what is the negotiating power based on
• Number of clients and size
• Customer importancy for the brand
• Grade differentiation of product

Internal Company Analysis

• Analysis of the company's internal environment aims to identify its strengths and weaknesses.

• It examines the exclusive resources, unique capabilities, or unique resource combinations that provide a competitive edge.

• Audit internal resources by categorizing them as either tangible e.g. physical assets and financial resources or intangible e.g. human expertise and reputation.

• After defining resources, define competencies as the skills for coordinating and utilizing these resources toward achieving company goals.

• Exclusive resources or core competencies are those important enough to give you a competitive advantage versus other companies.

• Resources and capabilities must exceed those of competitors, be scare but profitable, in addition to hard to imitate.

Value Chain

• It segregates the company’s activities into primary ones (directly involved in getting and acquiring products) plus supporting ones (increasing efficiency).
• Support activities include supplies sourcing, technology development including human resource management, and infrastructure or direction finance.
• You should target tasks that optimize your best expertise and be efficient for external subcontracting.
• Also analyzes relationships between activities in order to get an overall integrated management.
• Value chain descriptions will offer a description of the company pros that we will develop as the cons that we want to avoid

Summary of the Situation (DAFO Analysis)

• A common framework for summing up internal and external situations is the DAFO (or SWOT, in English) analysis.

• DAFO evaluates weaknesses, threats, strengths, and opportunities.

• The DAFO matrix assists in understanding benefits and potential market damages and aids in proper decision-making.

• Critical external success are new consumers behaviour, competition. Changes on tech that can damage the business. The matrix divides the external analysis in opportunities and threats

• Opportunities present an occasion the enterprise can improve on or a opportunity that will allow them take be taken advantage of. To identify we would question. Are there new market trends?

• Threats can endanger the survival of a company or reduce its quota in the market.

Stakeholders Analysis And Social Responsibilities

• Another primary study that has to go unnoticed its to analyze the groups of interest and the social responsibilities.
• Should observe all the company participants for their own interests. This includes employees, directors, banks and politics.

Formulation of Strategies

• Strategic formulation will start by looking at the grades off a company.
• Analyzing corporate strategies , establishing growth methods, and setting up advantage and disadvantages.
• It has to be realized at 3 grades.

Corporate Strategies

• It is the biggest strategic grade performed by the manager and consist of a time extension.

Matrix BCG(Boston Consulting Group)

• Is a tool that help direct business to a specific area.
• This matrix allows to analyze the selected business in accordance with the business market growth and the position of the competition to see if they match. This method will show what is to improve invest and if to abort – Estrella consist on high growth high stake and highly recommended to continue to grow the business. – Question sector which are sectors with high market growth and scarce stake, recommended to invest to diversify. We have to check the strategy to grow it.

– Vacas consist on low growth high high profit. Since there is a limited market its the place to keep costs effective to re invert on new stars. – Perro is a sector wit low growing and low market participation, the business it’s not growing and low opportunity’s recommend ti get rid of it. Generally its is the products at the end of time.

Competitive Or Business Strategies

• Once the process has been made and decided what to invest in we have to decide what marketing competition or business strategie should follow for these business.
• Follow strategy cost with all the implication on getting a good trade and low products. Strategy market that try’s to sell to a reduce market with a high product There are two types.
• Strategy is to reduce price and all the operation costs to increase the amount of cell to sell.
• Focus in market is the way to improve the communication.

Implementation plus Evaluation of strategies

• Once all the best strategies have been observed they will not have change it not taken to a location where they are allowed to perform in a correctly form and don’t count.
• In implementation is well be taken into to account two variables. Organizational were will apply that organization best suits the company . Human capital resources have to be also designed yo each task and the development of the strategies.