ICS

Functional analysis in business
optimization

Serbia

One of the good ways for proper planning and implementation of optimization is to include a functional analysis. This analysis has been widely used in companies of different sizes and ownership structures. Its basic advantage is that it looks beyond the definition of jobs through job descriptions and group tasks according to the types and impact on the outcome of the work. And what is its biggest advantage is that narratives that abound in descriptions of duties and tasks turn into mathematics and clearly outcome.

One of the key aspects of this analysis is also reflected in the extent of choosing how it will be implemented. It means that by applying this method, you can select the level of aggregation (complexity) to observe the jobs that are performed within your company, but above all, you will observe groups of jobs, not the people who perform those jobs. Therefore, you can consider jobs as groups of activities that make up a smaller part of activities and define its impact on the final result of the company's business. It avoids subjectivity in the business management segment, because you are analyzing if the job has affects on the final result of the company or not.

The simplest division of business functions is on commercial or functional jobs and administrative jobs. Commercial or functional jobs are those that are aimed at achieving a positive result of the company in a financial way, but also in terms of achieving corporate goals. These are sales functions, but also sales support functions, customer care activities, marketing and promotion activities, etc.

Administrative functions are support functions. These are all functions that are performed in order to provide logistic and administrative support in company. Its include secretarial and office work, accounting, etc. Sometimes, functional analysis introduces a third category – commercial/ administrative functions, which defines group of jobs that are important for achieving the results, but are not in the function of direct profit generation. These are procurement group of jobs, logistics, etc.

The ideal proportions of administrative and commercial functions are 20%: 80%, but this is a rare achievement. It would be helpful to keep this relationship at 30%: 70% and to try to keep it that way when you develop your company both in terms of jobs or staff issues. When you find out which job group you do not have for achieving this proportion, you will also know how to rearrange or optimize jobs on employees that you have or you will have.

---

Author: Bojana Jovanov, Consultant for financial analytical processing and implementation of matrix management models, during her professional development she worked on team-based methodologies for evaluation and classification of jobs, as well as the application of functional analyzes in the operations of companies of different sizes and ownership structure in the territory of the Western Balkans, lives and works in Serbia