Department

economic-dictionary

A department is a functional unit, which is assigned people, resources and responsibilities in the production process of a company.

Every company has a functional structure, which defines responsibilities and functions that contribute to the achievement of objectives, and that together, fulfill the mission of the organization and the vision in the long term.

This structure, in turn, has units that operate with their own resources, their own objectives, and their own work teams. Interconnecting in some parts of the production process with other operating units to deliver a final product; these units are departments.

Departments of a company

The departments of a company house areas necessary for it to function and elementally, at least the following can be identified:

  • Human resources department: It is in charge of the processes related to the company's workers, from the recruitment and selection stages, to their termination. This includes the internal training processes, registration of salaries and days of rest, legal holidays and benefits.
  • Accounting and finance department: It is in charge of recording the economic events of the organization on a day-to-day basis, as well as carrying out periodic analysis of financial indicators, delivering alerts to general management about possible risks. An example of these risks are deviations in accounts payable and receivable.
  • Operations and logistics department: It is in charge of the production of goods and services of the company, as well as their distribution. It could be called something like “the heart” of the company, since what customers will consume is carried out here. The management of the department is the most dynamic of all, as it responds to demand and market trends.
  • Commercial department: It is in charge of selling and meeting the goals of the company, through marketing, advertising and sales strategies. This department participates in the process prior to the elaboration of the products, through the market study, detecting business opportunities and, later, positioning its sales until it reaches the positioning of the brand.
  • Department of administration or general management: It is in charge of the global monitoring of the organization, as well as establishing the objectives of the company for a period (for example, for 2021). The general management responds to the requirements of the different departments, facilitating their work until the goals are met. Therefore, it is an agile and very well prepared department, in which professionals must have general knowledge of each field of action to interpret financial and commercial reports, and understand production processes.

Departmental articulation

Independent of the structure of the organization; Whether it is more hierarchical and vertical, or more collaborative and horizontal, the departments, yes or yes, must work together to some extent.

This is because there are dependencies in a process that is responsible for resources, deadlines and objectives to meet.

Examples of departmental articulations

To be clearer, here are some examples of articulation between departments:

  • Accounting and finance department with human resources department: How could the accounting and finance department know how much it should pay an employee at the end of the month, if human resources did not report the attendances and / or leaves that that employee had during said month ? So that internal communication line between both departments is necessary.
  • Human resources department with commercial department: How is the process of recruiting and selecting vendors carried out, if the commercial department does not provide the profile you need for an effective sale? They must communicate!
  • Sales department and operations department: How will the operations department know how much to produce, if the commercial department did not carry out the sales projection? That information is crucial to avoid out-of-stock or over-stock.

As you can see, departments tend to have, in part, a life of their own in business management. However, this does not make any sense if that work is not linked with the rest of the productive link. Together they make the company gain strength and achieve an impact on the market, and therefore, on people.

To achieve these communications between departments, technology offers a series of management software (ERP), where information is instantaneous and thus streamlines processes that would otherwise be very slow.

However, the human component and the relationships between people from different departments will complement the communication channels. Thus generating much friendlier dependencies between the internal customers of the organization.

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