Every organisation relies on a set of core business functions to operate effectively, achieve its goals, and deliver value to customers. Whether you’re running a startup or managing a growing enterprise, understanding these functions is essential to improving productivity, aligning teams, and driving business success.
For a company to run successfully, it requires a combination of various systems. All models must work together towards specific goals. Business processes and functions are among the primary elements that every company must focus on.
Understanding the two areas makes it easy to work on enterprise resource planning. The problem, however, is that not every person gets the distinction between processes and functions. Although the two are similar in some ways, business owners, managers, supervisors, and other stakeholders should be aware of the differences.
The success of any business process or function depends on how effectively it’s implemented. For that, you have to know what works where.
In this guide, we’ll explore the main business functions, how they interact, and how you can optimise them for greater efficiency and growth.
What are Business Functions
A business function consists of activities specific to a particular operation. It is usually carried out by a department and occurs regularly to help a business accomplish its mission. Functions can be internal, meaning that they are part of the organisation, or external, which is supplied by a third party.
The different areas of a business function are interdependent. Therefore, they require data from each other. The success of a company, workflow and communication all depend on how well functional areas are integrated. Function falls into two categories: core and support.
Core functions are the activities directly responsible for producing goods or services, either for the market or a third party. So, tense functions are part of a company’s main activities.
Companies can have one or more primary functions. Support functions are secondary or ancillary, hence contributing to the success of core functions. The outcomes of these activities don’t have direct contact with the intended market.
Regardless of the business type (private, non-profit, government), industry, or size, an enterprise has three standard functions – operations, finance, and marketing.
What Are Business Processes
A business process involves various activities that use available inputs to create an output that contributes to a specific objective. For this reason, successful business operations and growth rely on the effective execution of processes.
Through business process management (BPM or BPMS), enterprises can deliver their best value. The generated value has to consider the customer. Like with functions, business processes have internal and external customers. Depending on the elements involved, a business process can be complex or straightforward.
How are business processes different from other tasks, though? A process is flexible, measurable, repeatable and specific.
Core Business Functions (And What They Do)
These are the mission-critical areas of a business responsible for delivering products, services, or value directly to customers.
Operations
The heart of production and service delivery. This function ensures everything runs smoothly, resources are managed efficiently, and goods/services meet quality standards.
- Examples: Manufacturing, logistics, supply chain, service delivery
Marketing and Sales
Responsible for identifying customer needs, promoting products, and generating revenue.
- Examples: Advertising, social media marketing, lead generation, B2B/B2C sales
Finance
Keeps the business financially healthy. Handles budgeting, financial planning, cash flow, and compliance with financial regulations.
- Examples: Bookkeeping, forecasting, reporting, payroll, taxes
Human Resources (HR)
Manages your most valuable asset—your people. This function recruits, trains, motivates, and supports your workforce.
- Examples: Hiring, training, performance reviews, conflict resolution, benefits management
Research and Development (R&D)
Focused on innovation and continuous improvement. This team develops new products, improves existing services, and keeps the company ahead of the competition.
- Examples: Product design, market analysis, innovation labs, testing
Support Business Functions
These functions don’t directly generate revenue but are critical for enabling core functions to succeed.
Information Technology (IT)
Supports systems, software, hardware, data management, and cybersecurity across the business.
- Examples: Network setup, help desk, software management, data backup
Legal and Compliance
Ensures that the business operates within the law and adheres to industry regulations and ethical standards.
- Examples: Contracts, GDPR compliance, risk management, intellectual property
Procurement
Responsible for acquiring the goods and services needed to support operations, often with a focus on cost-effectiveness and reliability.
- Examples: Supplier sourcing, inventory management, vendor negotiations
Customer Service
Handles interactions with customers after the sale, ensuring satisfaction and building brand loyalty.
- Examples: Help desks, returns processing, feedback channels, FAQs
How Business Functions Interact With Business Processes
It’s easy to confuse business functions with business processes, but understanding the difference is key:
- Functions: Organisational areas with specific responsibilities (e.g., finance, HR).
- Processes: Workflows that often span across multiple functions to deliver a result (e.g., onboarding a new employee involves HR, IT, and finance).
Example: The Customer Onboarding Process might include:
- Marketing (lead acquisition)
- Sales (closing the deal)
- IT (account setup)
- Customer Service (support)
The process flows through several functions.
Examples of Functions and Processes
A practical scenario for each area provides a better understanding of how they work.
Business function example: Let’s take marketing and sales as the functional areas. In such cases, the functions include marketing a product, taking sales orders, providing customer support, advertising, and sales forecasting.
Business process example: Consider the sale of a smartphone. The functional area is accounting and finance. Here, the input is financial help to buy a phone, while the process involves a business arranging in-house financing options. Thus, the output would be a customer receiving financing through the tech company.
Importance of Business Functions and Processes
The business function sets the framework for activities in a business, helping to identify responsibility areas. Functions can be separate from the product or service they are responsible for creating. Therefore, when an organisation’s needs shift, its functions can also be adjusted to meet the new demands.
Business processes facilitate communication between customers, suppliers, and stakeholders. All the infrastructure a company builds should be designed to enhance processes. Improved business processes boost productivity by eliminating redundancies and unnecessary tasks.
Picking between business processes and business functions can be difficult, especially when the distinction between the two is unclear. Processes transform inputs into services and goods, while functions are specific to a particular area. Both elements are critical to business operations, which is why a company must work on improving business processes and functions.
How do you identify a business function?
Business functions are typically divided into two main categories: core functions (which directly contribute to value creation) and support functions (which enable core functions to perform efficiently).
Here’s a breakdown of common business functions and what each is responsible for:
Operations: Core business processes. Handles the day-to-day activities that produce goods or deliver services. Examples: manufacturing, logistics, production scheduling, quality control
Human Resources: (Support) Employees – Manages employee life cycles—from hiring to training and performance management. Examples: recruitment, onboarding, payroll, workplace policies
Sales and Marketing: (Core) Generating new business. Generates revenue by attracting, converting, and retaining customers. Examples: market research, advertising, brand development, sales outreach
Finance and Accounting: (Support) Managing budgets. Oversees the financial health of the business. Examples: budgeting, bookkeeping, forecasting, and financial reporting
Research and Development: (Core) Innovating new business products and services. Drives innovation through new products, services, or process improvements. Examples: product design, prototyping, testing, competitive analysis
Information Technology (IT): (Support) Systems and applications (apps). Supports digital infrastructure, tools, and system security. Examples: hardware/software management, data security, system support
Customer Service: (Support) Managing customer relations. Builds customer satisfaction and loyalty through ongoing support. Examples: troubleshooting, returns handling, customer feedback.
Tip: When analysing your business, look at each function in terms of what role it plays in delivering your product or service. This helps clarify responsibilities and align strategies with your business goals.
Business Functions & Processes
Understanding and managing business functions effectively ensures your organisation runs like a well-oiled machine. It improves communication, clarifies responsibilities, and strengthens alignment across teams. When functions work together through clearly defined processes, your business becomes more agile, efficient, and successful.
Checkify Business Processes
Checkify offers a way to manage business processes with checklists.
Checklists enable you to store processes and launch them to use anytime so tasks are completed the best way every time.
FAQs Business Functions
Why are business functions important?
They help define roles, responsibilities, and resource allocation. Without clearly defined functions, teams can become disorganised, misaligned, and inefficient.
What’s the difference between a function and a department?
A department typically carries out a business function, but functions may span departments. For example, “compliance” could be handled by both legal and HR.
Can business functions change over time?
Absolutely. As your company grows or adapts to new markets, you may restructure or create new functions (like data analysis or sustainability).