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2. AREAS OF MANAGEMENT

An organizational structure can also be divided more or less horizontally into areas of
management. The most common areas are finance, operations, marketing, human resources, and

administration. Depending on its purpose and mission, an organization may include other areas as
well – research and development, for example, or risk management.

Human Administra Other (eg.
Finance Operations Marketing resources tion Research &
Develop-

ment

A financial manager is primarily responsible for the organization’s financial resources.

Accounting and investment are specialized areas within financial management. Because financing
affects the operation of the entire firm, many of the presidents of the largest companies are people

who got their “basic training” as financial managers.
An operations manager creates and manages the systems that convert resources into goods

and services. Traditionally, operations management is equated with the production of goods.

However, in recent years many of the techniques and procedures of operations management have
been applied to the production of services and to a variety of nonbusiness activities. Like financial

management, operations management has produced a good percentage of today’s company
presidents.

A marketing manager is responsible for the exchange of products between the organization

and its customers or clients. Specific areas within marketing are marketing research, advertising,
promotion, sales, and distribution.

A human resources manager is in charge of the organization’s human resources programs.
He or she engages in human resources planning, design systems for hiring, training, and appraising

the performance of employees, and ensures that the organization follows government regulations
concerning employment practices.

An administrative manager (also called a general manager) is not associated with any

specific functional area but provides overall administrative leadership. A hospital administrator is a
good example of an administrative manager. He or she does not specialize in operations, finance,