All organizations provide either a product or service in some form that we’ll refer to as a result of some defined activity. The words products and services usually become commingled because most products provide a service and most services also involve a product. A consultant’s report involves a product and a service—a result. Insurance and financial institutions provide products and services—results. The arts and related activities such as symphonies, film, theater, literature, painting, and others provide a service through the use of products. Fast-food organizations provide a product and a service. The government provides products and services; building an infrastructure is both a product and a service—a result. Healthcare services market their products to provide services.
All organizations operate within some form of structure. shows a generic functional structure for any organization and will be used as a model throughout our discussion on managing at the entry level. All the functions listed may not apply to any one organization, and they can be disregarded if not essential. All of these functions will have different levels of importance depending on the organization. The organizational model shown includes three groups: genesis, distribution, and services.
Genesis
- Research
- Development
- Production
Distribution
- Marketing
- Sales
- Physical Distribution
- Customer Service
Services
- Financial
- Human Resources
- Patent and Legal
- Public Relations
- Procurement
- General Administration
Genesis
Genesis includes the basic functions of research, development, and production that play some role in every organization. The types of research will differ, and development may come from any discipline, but eventually something must be produced as a result of the research and development effort. That result may be a product, a service, a combination of a product and service, or some intangible benefit, but there will be a result from that activity.
Distribution
Distribution, which includes marketing, sales, physical distribution, and customer service, are common activities in all organizations. Distribution is more commonly associated with industrial organizations, but it applies to all organizations. The government, from the federal to the smallest entity, provides these functions, although not necessarily to our satisfaction. Academic institutions market, sell, and provide services to their customers, who are the students and the community. Arts-related organizations also market, sell, and provide a service to their customers and the community. All organizations, without exception, must provide some level of these four distribution functions.
Services
An organization’s service functions provide all the ancillary work necessary to achieve some desired result. No organization can operate without them. Certainly financial and human resources are absolutely essential. Patent and legal services include trademarks, copyrights, and protection of intellectual property. Public relations, depending on the size of the organization, can be an organized function or handled by some designated person. And every organization requires assignment of the procurement function to some individual or group. The general administration classification includes all of those activities that we too often take for granted—benefits administration, internal and external communication services, custodial services, information and data processing, economic and other studies, fire and emergency evacuation, food services, library services, internal and external mail services, medical health and hygiene, transportation and travel services, and many others that we depend on for meeting our commitments as managers.