These are activities or areas in the life of an organisation. It cuts across all organisations. Some companies describe them as follows:
Production, Manufacturing – Operations
Particularly, if the business of the company has to do with tangible products, they describe this activity as production or manufacturing.
There are also operations. That is not to say that those who produce, or manufacture do not have operations. More specifically, if you are dealing with intangibles or services, you are likely going to call it operations. For example, a hospital, a bank, or a school will call their activities operations. Here, it is not production nor manufacturing that these organisations deal with rather they deal with intangibles.
Marketing, Sales, Distribution and Support
Every company will have marketing activities taking place in addition to sales, distribution, and support. With marketing, an organisation will have to explain the products or services they offer. Some companies also do sell products and services. For example, a company that sells cars will also sell spare parts and carry out repairs. A hospital dispenses drugs and consults. With marketing, an organisation will have to explain what they do. The sign on the product, the customers, the market they want to operate in, the process or channel they use to get the product they are dealing with, or services all fall under, marketing.
Organisations must sell their product or services in their chosen market. They also must distribute these products. Finally, some companies must support not just their product, but their customers, and the geographical market they operate in. For example, an organisation that manufacture cars may need to support its product especially if it is of a specialised brand.
A typical example is, when a Nigerian automaker decides to enter the Ghanaian market, it will be expected that they will open a workshop in Ghana. The workshop will be used to support their brand in the Ghanaian market, or they may have to train, pre-qualify, and assign personnel to workshops privately owned to help them support their products and customers in the Ghanaian market. Without these, the entry might be unsuccessful and short-lived as there will broken down vehicles as a result of lack of spare parts and no repair support. Customers coming down to Nigeria to buy spare parts and repair their vehicles is not just feasible.
All these have to do with the second level every organisation must have. Some may be heavy into it or not. Organisations depend on what they choose to do when you look at the value chain of that industry. No company operates in the entire spectrum of the value chain. In the healthcare industry, hospitals do not manufacture drugs and they do not train doctors. Some other organisations do these things. In all of these, organisations choose where they can operate in the value chain.
Admin and Corporate Service
The other activity that happens in an organisation is what we refer to as Admin or what some people call corporate services. Some companies have logistics and procurement as part of corporate service. Some companies have procurement reporting to the Admin. In big manufacturing organisations or organisations with complex processes, their procurement might be in operations or within the production section.
These are the three things you will find in different varying degrees in organisations.
In summary:
Activities/Areas
- Production/Manufacturing – Operations
Tangible Products Intangibles/Services - Marketing, Sales, Distribution and Support
3. Admin/Corporate Services
