ADMINISTRATIVE FUNCTIONS OF A COMPANY: IMPORTANCE AND EXAMPLES - DUDAS - 2025

The administrative functions are those duties or activities that every manager should be used to achieve outstanding results in the short and long term in a company. These functions are universal in nature, so every manager can implement them in their respective work.

Administrators, broadly speaking, participate in a common set of functions to meet the objectives of the company. These administrative functions were described by Henri Fayol in his book "Industrial and General Administration" in 1916.

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Administration, also known as business administration, is the management of an office, company or organization. It involves the efficient organization of people, information and other resources to achieve the objectives of the company.

Information is key to business operations, and people are the resources that make use of information to add value to a company. This means that companies will have difficulties if they do not have some kind of administrative management.

Administrative process

When the administrative process is implemented in a systematic way, favorable results are generated in the management of companies. This process considers that the administration is the one that executes certain activities called administrative functions: planning, organization, coordination, direction and control.

It is valued as a process because an organization cannot be carried out if planning has not been established, it cannot be coordinated if it has not been planned and organized previously, and so on, until it cannot be controlled if it has not been planned, organized, coordinated and directed activities.

The 5 administrative functions in a company

These functions are intended to indicate in which fields the work will be carried out and where the efforts will be applied, in addition to solving the problem of how to do the tasks in each of these areas to achieve the predefined objectives.

These functions comprise vital parts of the structure of a company, helping the organization to manage resources and people efficiently.

Planning

It means being able to decide in advance what to do, when and how to do it, as well as who should do it. Map the path from where the company is, to where it wants to be.

The planning function involves setting goals and organizing them in logical order. Also, set the strategies to follow to achieve them. Management participates in both short-term and long-term planning.

In planning, unity must govern and it must be precise, as well as being flexible and continuous in a certain way. Previous experiences must be taken into account, in order to avoid any problems presented previously.

Organization

It involves identifying the responsibilities to be carried out, grouping the responsibilities into departments or divisions and specifying the organizational relationships.

The purpose is to achieve coordinated efforts among all elements of the organization. The organization must take into account the delegation of authority and responsibility and the scope of control within the supervisory units.

Good work organization is essential, because in this way the activities to be carried out can be ordered so that the company's structure is solid.

Coordination

It refers to linking the procedures with the tasks carried out in the company in order to complement them and help in the work of each of the workers.

Its objective is to consolidate everything that is done in order to meet the goals and general objectives proposed by the company.

Address

It is leading people in a way that achieves the objectives of the company. This implies an adequate allocation of resources and providing effective support.

Leadership requires exceptional interpersonal skills and the ability to motivate people. The right balance must be struck between an emphasis on staff needs and an emphasis on economic production.

It must be carried out by a manager, so that employees can take the actions set out and achieve the planned goals.

Control

It is the function that evaluates the quality in all areas and detects potential or actual deviations in the organization's plan.

This ensures high-quality performance and satisfactory results, while maintaining an orderly and trouble-free control of the environment, including information to measure performance management and the implementation of corrective actions.

Inspects and evaluates that the tasks to be carried out in the company are carried out correctly. In addition, you must be aware of correcting the errors generated, as well as that there is any deviation from the objectives.

Importance

Keeping finances healthy

If you don't control spending, reduce waste, and have confidence in your data, it's impossible to keep your finances healthy. If all areas of the company are organized, including the finance department, it is much easier to manage cash flow.

Establishing the frequency and methods to maintain this control is very helpful. Information should also be centralized to avoid duplication and errors when sending it to other locations.

This is why you need to replace multiple spreadsheets with a single reliable system that is updated by a small number of people.

Increase productivity

You can identify which teams perform certain tasks best and let them focus on strengths. Identifying the errors in the process and correcting them will result in a more efficient methodology that will waste less time and also fewer resources.

By identifying and correcting errors, it is possible to produce more in less time and use fewer resources in the process, ensuring better results.

Help meet goals

Administrative management makes it possible to achieve the required results. This is because it focuses on the implementation of more effective processes that certify that the objectives are achieved.

Generate customer satisfaction

The most efficient processes are reflected in quality and deadlines, resulting in clients meeting their needs. The relationship with customers can be closer, helping to better understand their needs, in order to offer products and services that satisfy them.

Promote data-driven decisions

Decisions are made based on the results. That is, if everything that is happening is being monitored, it will be recorded in data. Based on this data, more precise decisions can be made, analyzing past and current scenarios, to plan for the future.

Examples

Commercial function

It is the function that links the company with the external environment. It is in charge of all the activities required for the goods and services produced to reach the clientele.

Through a market analysis, the aim is to establish what product or service needs to be produced, which people you want to target, how it will be promoted, where it will be sold, what will be its price, etc.

This activity will seek to make the customer feel satisfied with the product or service provided and not with any other that the other companies have placed on the market.

Accounting

It keeps control of the resources that companies have, in order to manage them efficiently. First, the accounting process is required to be established, carrying out the automation, valuation and registration stages.

In addition, it informs through the financial statements on the operations carried out by the company. It must show what are the resources and how much is the amount of debts, products, expenses and assets, also making an evaluation of the company's performance.

The information offered by the accounting of a company is essential to be able to make the decisions of both the owners and the managers.

Finance

Plan the economic resources in such a way that its application is done in the most optimal way possible. In addition, it investigates the sources of financing to attract resources when the company requires them.

It seeks to reduce the uncertainty about the investment, in order to achieve the maximum profitability of a company or earnings per share.

Hygiene

It is defined as the activity applied to protect the physical integrity of employees and prevent future accidents. Controls and prevents environmental risks for humans in the company, which could cause diseases.

It is responsible for minimizing the existing risks for workers and for work teams in their mutual relationship.

References

1. Ecourses Online (2020). Functions of administration. Taken from: ecoursesonline.iasri.res.in.
2. Reference (2020). What Is an Administration Function? Taken from: reference.com.
3. Institute of Administrative Management (2020). Administrative Management. Taken from: instam.org.
4. Economic Encyclopedia (2020). Administrative functions. Taken from: encyclopediaeconomica.com.
5. Sabino Ayala Villegas (2006). The administrative process and its basic functions. Taken from: gestiopolis.com.
6. My Abcm (2020). Learn the importance of administrative management to business. Taken from: myabcm.com.