DEPARTMENTS OF A COMPANY AND THEIR FUNCTIONS - CULTURE VOCABULARY - 2025

The departments of a company can be divided into commercial, human resources, finance and administrative departments. A company is an entity in which capital and labor intervene as factors of production.

This means that labor factors are used, such as labor, to create products or services. Companies can be divided into three sectors depending on the economic activity they develop.

The companies in the primary sector are those dedicated to obtaining resources from nature, these can be agricultural, fishing or livestock. Secondary sector companies are those dedicated to industry and construction, that is, to take the raw materials obtained by the primary sector, and transform them into finished products. And, finally, companies in the tertiary sector are those destined to the production of services.

As companies are a legal entity, they can also be classified according to their constitution. They can be individual companies, which belong to a single person, or they can also be companies. Companies are companies made up of a group of people, and within companies, we can make a distinction based on the responsibility of their partners.

Limited liability companies are those in which the partners have legal liability limited to the contribution made.

In joint stock companies, the capital is divided into shares, and the partners are responsible for the shares they have. And finally, cooperatives, which are societies in which responsibility is unlimited in the participation of members, and decisions are taken democratically.

Companies can also be classifiable according to their size. In SMEs or large companies. SMEs are considered medium and small companies, up to a maximum of 250 workers. Large companies, which are those with more than 250 workers, have a characteristic organization to develop their economic function.

These are divided into specialized departments for better organization of tasks. These departments are the commercial department, the human resources department, the finance department and the administrative department.

Although the company is fragmented into smaller departments, they all have to work in harmony and have great interdepartmental communication for the company to be successful in its business. If departments do not communicate with each other, or work together, the company will be fragmented and unlikely to survive in the market.

Departments of the companies

commercial department

The commercial department of a company is one of its most important parts. He is in charge of creating general action plans, and another one for the medium to short term. The marketing plan created has to function as a guide for action.

Market studies are carried out in this department, these studies are necessary to understand and analyze the viability of the company. They study the environment, here they value consumers, their buying habits, tastes, etc. And also the resources and competitors that they can face in the market in which you are operating.

Through the market study, we also try to find the suppliers that are available, to find out which one offers the best price with the best conditions. This is called supply management.

Another function of the commercial department is to take care of marketing and customers. How to get new customers, promote the company's products and maximize sales.

In addition to all these functions, the commercial department is in charge of managing the warehouse. This management consists of controlling raw materials, finished products, packaging, etc.

HR department

Depending on the size of the company, the human resources department may be managed by a few people, or it may be divided into more subsets. It has many varied functions where it is necessary to manage a dedicated team.

• Job function

This function consists of the organization of work templates, the selection and training of personnel. The human resources department is in charge of planning the staff and the positions that are necessary, offering the jobs with a clear description of the profile that is needed and carrying out the selection process for new workers.

Once the workers are selected to be part of the company, they also have to be in charge of training them. Another task is to process the dismissal procedures.

• Personnel administration function

Once the workers become part of the company, the human resources department is in charge of formalizing contracts, managing payroll and social security, managing vacation leave, leave, etc; and establish a disciplinary regime if the workers do not abide by the rules of the company.

Within this function, the function of labor relations that develop in the company can also be included, and mediate in cases of problems with workers.

• Human resource development function

This characteristic activity of human resources implies that it is in charge of establishing training plans and studying the potential of the personnel. It is a very important task for the company, since a good development of human resources generates greater motivation in the workers, which translates into more productive employees.

Finance department

It is the department in charge of managing all the inflows and outflows of money. The basic functions that every financial department must fulfill are the control of accounting, cost management and the realization of budgets.

In the accounting of a company, all the costs that the company has are reflected, they can be direct, indirect, fixed, variable costs…

Once the costs are calculated, the finance department is in charge of managing them. The cost analysis determines if the company is profitable, or on the other hand if it is necessary to change production or even close the company.

Another important function of the finance department is the creation of budgets. Budgets, in cases such as public limited companies, have to be later ratified by the board of directors. With the preparation of the budget, we control where to invest, where to spend and it is established as a follow-up plan for the company.

For large companies that are listed on the stock market, their financial department is the most important part for shareholders, since it is in charge of deciding what to do with the company's profits and whether to distribute dividends.

Administrative department

The administrative department is the one that is in charge of encompassing the rest of the departments. Its main functions are those of organization, planning, direction, coordination, control and evaluation.

Organization and planning are one of the most important tasks of the administrative department. Through these, all departments communicate to achieve a harmonious process in the company with the goals to be achieved, and how to achieve them. In this way, each person and department is clear about their role, duties and responsibilities.

Through the direction, instructions are given to carry out what is organized and planned. It is important that the management has good qualities for the success of the company.

The direction must be reasonable, this means that the orders sent to the departments have to be workable, taking into account the person, and if they have the experience and skills necessary to fulfill the task. The orders given must be complete and clear so that they do not lead to confusion.

All this is included in the coordination function of the administrative department. Actions and efforts of all the company's departments must be harmonized. And finally, evaluate the development of the business activities that are carried out and look for improvements if necessary.

The administrative department is also in charge of the correspondence that reaches the company. And it maintains communication with suppliers and customers to maintain the commercial relationship of the company's environment.

Likewise, he is in charge of filing all the legal documents that the company has. It classifies and keeps them, and is in charge of their computerized or microfilmed processing to keep them for as long as they are valid.

When companies are large, the administrative department is also in charge of the secretariat and communication. These tasks could be included in the coordination and organization function.

And it is that the part of the secretariat is in charge of facilitating relations between management and staff, through meetings, conferences, etc., as well as relations with the outside world through interviews, press conferences and communiqués.

marketing department

The marketing department is in charge of defining the image of a company and promoting the product it offers. You must find a way to represent the company in a positive way before clients, shareholders, investors or other groups.

That is, it has the function of creating a representation of what the company or product is, what it contributes, how it acts, etc.

Advertising campaigns, market studies, web optimization, customer or supplier supervision or social media management are some of the most common techniques used by the department to achieve its goal.

Technology department

This department is in charge of the management, development and support of the different computer and computing systems of a company.

You work in all directions, as most departments depend on your support to develop effectively.

Its main functions include the maintenance of systems, the management and administration of databases, the implementation of programs and platforms, the development and digital design or the responsibility of ensuring the security of all the above.

Communication Department

Its main mission is to manage the internal and external communication of a company. Although in small and medium-sized companies it is usually merged with the marketing department, they are two different groups.

Marketing is more focused on selling, while communication is on the values ​​and reputation of the company. In turn, while marketing seeks to achieve short-term objectives, communication is a more persistent job that will provide benefits in the medium or long term.

Its functions include managing and spreading positive messages, standardizing communication processes, creating a feeling of belonging to the company and generating credibility with clients.

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