Myself, MD. Shamser Azam Suzon and Mr. Karim appointed me as the Business Analyst of his forthcoming business ‘Karim’s Grocery Shop’. Sir (Mr. Karim), you have asked me to assess the core business functions of your grocery shop to be more focus on the functions and told me to evaluate the business aims & their relation with stakeholders. So now I am here with the complete and detail solution. At first I’m going to start with the core business functions of ‘Karim’s Grocery Shop’.
Core Business Functions of ‘Karim’s Grocery Shop’
Basically the core business function is a process or operation that is performed routinely to carry out a part of the mission of an organization. The core business function of an organization is an idealized construct intended to express that organization’s “main” or “essential” activity. It means that a firm’s success depends not only on how well each department performs its work, but also on how well the company manages to coordinate departmental activities to conduct the core business process. First of all you should define that what should be the core business functions of your (Mr. Karim) Grocery Shop. I’m pointing out those here,
2. Finance & Accounting
3. MIS (Management Information System)
4. Human Resource Management (HRM)
5. Marketing & Sales
6. Customer Care Service
All large organisations depend on an administrative spine. The role of administration department within an organization is to process all of the admin and documents for the rest of the company. The main functions of an admin department of an organization like Karim’s Grocery Shop are;
‘ To process paperwork for external suppliers.
‘ To process paperwork and information for internal people. This could be anything from looking after the basic bills to the internal post.
‘ Looking after the internal communications so that all members of the business are aware of what is going on within the organization / shop.
‘ Organizing any deliveries or suppliers coming into the shops for the day for any reason.
‘ Arranging organizational extras such as business cars and any hotels for business trips that may be needed.
‘ Sending out any mail on behalf of the organisation / shop. This could be for different stakeholders, customers or even for staffs.
‘ The admin department will be responsible for ensuring that all records that pass through the department are filed correctly and can be found and referred to if and when they ever become necessary.
This is an important department for any organistaion like Karim’s Grocery Shop and they work across all departments and with all kinds of work. I guess that no one day is the same as the last in an admin department as there is so much that they are responsible for.
Finance & Accounting
The Finance & Accounting department consists of many different roles, most of which are critical to any smooth running company. Its main job is to provide the financing and accounting information which is needed to make various decisions.
The main areas of Karim’s Grocery Shop in Finance & Accounting department include:
‘ Book keeping – The finance department is responsible for keeping track of all sales and capital spending at the shop.
‘ Profit and Loss – Another responsibility of the finance department is to provide management with a profit-and-loss statement that will show the overall strengths or weaknesses of the whole business.
‘ Providing management information – On-going financial information will be required by managers to enable them to make better decisions in regards to Mr. Karim’s business. Then they will be able to decide if it is worthwhile to switch to have some alternative product or business ideas to increase sale.
‘ Wages – This section of Accounting will be responsible for the payment of all wages and salaries of employees. The wages section also organizes collection of income tax and national insurance for the Inland Revenue. They also have to make sure that all of the employees of the shop are paying the right amount of tax on time without doing any mistake.
‘ Raising of finance – The finance department are also responsible for the way in which Karim’s Grocery Shop raises finance, for example through loans and what the repayment of interest is on that finance. The finance department will also supervise the payment of dividends to shareholders
‘ Making payments ‘ Will make sure that all bills are paid by the shop, on time and also at the least cost possible. They will be also responsible for all outgoing payments and making sure that what they are paying is correct.
‘ Receiving payments – The accounting department must also receive payments and make sure that these are all processed correctly & on time.
‘ Budgets – They will be also responsible for giving budgets and estimates of what they feel the shop should spend. They must also predict budget figures for years to come so that Mr. Karim knows what he should spend and more importantly, charging to customers.
All of these reports play a vital role in today’s businesses whether they will be multi-billion dollar corporations or a mom and pop corner store in a small town. Not only do they provide valuable information to potential investors, they will give Mr. Karim a snap-shot of the financial health of his business at any point in time the reports are generated.
Management Information System (MIS)
Management Information System can be defined as ‘The combination of human. A management information system (MIS) provides information that organizations need to manage themselves efficiently and effectively. Management information systems are typically computer systems used for managing three primary components: technology, people (individuals, groups, or organizations), and data (information for decision making). The basic function of the MIS department in Karim’s Grocery Shop will be as bellow:
‘ Will study business problems and implement systems to solve them.
‘ Analyze problems and change business processes.
‘ Develops software to gather and store data.
‘ MIS will extract and analyze organizational data.
‘ Organize a team of analysts, programmers and others to create an innovative solution.
‘ This will also monitor and inspect the operation plans and comprises with the differences between operation and plan.
‘ Predicting the future situation of the business.
‘ The MIS mechanism will enable the organisation / shop to weigh the pros and cons of several methods of accomplishing a task and choosing the most practical one.
‘ Will help the smooth running of the business by providing informations on the shop’s data (such as accounting figures). Employees from different levels will then evaluate these informations so that decisions can be made to ensure that Mr. Karim’s business remains competitive and successful.
Human Resource Management (HRM)
HRM is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training.
The core functions of HRM for Karim’s Grocery Shop is listed bellow:
‘ Manpower Planning – It involves the planning for the future and finding out how many employees will be needed in the future by the business and what types of skills should they possess.
‘ Job analysis and Job description – HRM Department will also be involved in designing the Job analysis and Job description for the prospective vacancies. It’s the process used to collect information about the duties, responsibilities, necessary skills, outcomes, and work environment of a particular job.
‘ Determining wages and salaries – HRM Department will also be involved in conducting market surveys and determining the wages and salaries for different position of Karim’s Grocery Shop through a consultation with top management and the Finance department.
‘ Recruitment and Selection – One of the most important jobs of HRM department is to recruit the best people for the organization / shop. Details regarding the recruitment and selection procedure can be found here.
‘ Performance Appraisal – Once the employees will be recruited, the HRM Department will review their (employees’) performance on a regular basis through proper performance appraisals.
‘ Training and Development – In order to improve the efficiency level of the employees they have go undergo regular trainings and development programs which is directed by the HRM department.
‘ Employee/ Labor welfare and motivation – HRM Department will conduct various employee and labors welfare activities which might include their get-together, annual staff parties etc. HRM department will also review organizational / shop policies and its impact on the motivation of the employees and labors.
‘ Dismissal and redundancy – HRM Department will take firm actions against employees who are not following the organizational code of conduct, rules and regulations. This can result in the dismissal of the employee.
Marketing & Sales
Marketing & sales department serves as the face of the organization, coordinating and producing all materials representing the organisation. The department interacts with people on all sides of a business, from top-level management to end-users. The sales department of any business is the catalyst of how well the products are introduced into the marketplace.
For Karim’s Grocery Shop the basic functions of Marketing & Sales department will be like bellow:
‘ Product Definition – Customer requirements, preferences and needs can change rapidly. Products in demand in one season might exhibit low demand in the following season. A marketing department’s research function will shed light on shifts in customer demand. Marketing and sales will be helpful to translate customer demand into product specifications. These definitions can include color choices, package sizes, feature modifications and even shifts to a new product line.
‘ Produce Promotional Materials – The marketing department writes and designs promotional materials like brochures, catalogs, direct mail pieces and advertising for print media, television, radio and the Internet.
‘ Media Relations – The marketing department will be like a conjunction between the company and the media, including newspapers, magazines, television stations, radio stations and websites. Thus Mr. Karim’s business will be featured among the people quite easily.
‘ Conduct Market Research – Marketing departments will often conduct research to evaluate customer satisfaction and the effectiveness of advertising and promotional campaigns.
‘ Manage Customer Relationships – One of the most important functions of a marketing & sales department is to keep current customers happy through building a good relationship with them. This might include giving customers regular interaction with the shop, letting them know about new products, and providing value after the first sale.
‘ Support Strategic Plan – An effective marketing department will develop their promotional efforts to support the goals that Karim’s Grocery Shop lays out in its strategic plan.
‘ Develop Promotions – A marketing department’s main responsibility will be to promote the products, services, mission and brand identity of a shop.
‘ Boost Sales – Often, a marketing department is responsible for supporting the efforts of the sales department. They meet with the sales staff and develop materials that will assist in selling the company’s products and services.
‘ Customer Identification – It is the responsibility of the sales department to identify the customer base of the shop. The sales department will work closely with the marketing department to ensure the shop’s products or services are marketed and sold to target consumers.
‘ Value Creation of Product – The sales department will must create value for the products they are selling to customers in order to grow the sales of the product. This value creation will also retain existing customers if the products continue to improve and work proficiently for the clients.
‘ Giving Special Offers – Retention of existing customer base through sales programs (i.e. discounts, customer loyalty rewards).
Customer Care Service
Basically this department is a part of Marketing & sales but if you (Mr. Karim) want to take your business to a higher level you should keep this department in mind. Customer service is the provision of service to customers before, during and after a purchase. Customer service is a series of activities designed to enhance the level of customer satisfaction ‘ that is, the feeling that a product or service has met the customer expectation.
Putting the basic functions of this department of the shop are bellow here
‘ Will support the shop to help customers to resolve their queries.
‘ This department will develop rapport with the customer base, greet by name, have knowledge of account ownership, be responsive and timely with correspondence and problem resolution, and display a caring attitude.
‘ Following the Code of Business Conduct and Ethics and other related policies, maintaining ethical behavior at all times and also working for the shop to promote business.
‘ Will give appropriate and relevant information to the customers.
‘ Maintaining a position of the business / shop of trust and responsibility by keeping all customer business informations confidential.
‘ Making initiate conversation to uncover customers’ needs by the customer care executives.
At present time almost all types of businesses are monitored & controlled by an ICT department. The number of crucial business tasks carried out on computers and the importance of the data stored in the system mean that any system failure can be catastrophic. Most organisations / shops like Karim’s Grocery Shop have a computer network where staff computers are linked through servers. Maintaining the servers, installing new (communal) software and additional hardware, such as printers and scanners, is all part of the ICT function. The main functions of ICT department in Karim’s Grocery Shop will be like bellow:
‘ Recommending new/updated systems and software to keep abreast of technological developments and of the needs of the business
‘ This department will buy & install the new hardware and software to keep shoulder to shoulder of technological developments and important needs of the business.
‘ There might be various types of computer problems among the computer users of the shop and the whole business. ICT department will be responsible to solve such problems as soon as possible.
‘ There might be need to repair the computer system and ICT department will do the work when required.
‘ If there is any need to connect new or additional equipment to the system the ICT department will take care of it and do the possible solution.
‘ Advising on / obtaining / issuing computer supplies and consumables.
‘ Installing a security system that limits access to authorized users and protects against hackers and viruses.
‘ ICT department will technically maintain the shop’s website.
‘ Monitoring computer use for compliance with the business / shop IT policy.
‘ They will operate a back-up system so that any kinds of critical data can be recovered easily and quickly in an emergency.
Sir (Mr. Karim), though you have decided to initiate the business with only food items but you also have a plan to make it large within a short time. In that case you should take a well & strong security system not only for your products but also for your various kinds of informations, files & electric data safety etc. The goal of a business is usually low expenses and high profits. That’s what business is all about, but the good businesses usually don’t sacrifice security and safety for profit. Functions of this department will be like bellow:
‘ The main function of a security department in a shop like Mr. Karim’s one, is to patrol the facility in order to find any security and safety infractions.
‘ Safety of products and distribution areas is a top priority for continued business profits.
‘ Enforcement of safety rules and regulations reduces accidents and product damage.
‘ Regular patrols of hazardous material areas for unsafe conditions help to avoid fires and employee injuries.
‘ Access control of the main and employee entrances and shipping and receiving areas helps reduce the chances of unauthorized access and theft.
‘ They might create customized software to protect all the data and information of the business or organization or shop. It’s too much important to keep confidential these informations to maintain a strong place in the highly competitive market.
So, dear Sir (Mr. Karim), I have completed my explanation & hope that you are quite satisfied with my assessment about all the core business functions for your forthcoming Karim’s Grocery Shop. I want to mention you that if you want to take Karim’s Grocery Shop to a next level, competing strongly with all the competitors that you have in this field, you should follow my assessment thoroughly that I stated above. I’ve suggested you three more departments which wasn’t in your plan that is, Customer Care Service, Security and ICT department because these departments will differentiate yourself from competitors based on superior customer service & security system. In the field of this kind of business which you selected, there are lots of competitors you will find around you. So, you have to be more & more conscious about the implementation of almost all the functions of each department stated above. If you can make it done perfectly then Karim’s Grocery Shop is going to be huge within a short time that you are dreaming. Hope, you get my points of view.
Now Mr. Karim, I’m going to tell you about the business aim which you should take for Karim’s Grocery Shop and how the stakeholders are related with those aims & objectives.
Business Aim of Karim’s Grocery Shop
A business aim is what a business would like to achieve in the future. A business aim is set up at the beginning of the business and is revised regularly. Through out the year, as they are set every year, they help to monitor the business progress. Aims are set with this in mind as SMART:
‘ S ‘ Specific
‘ M ‘ Measurable
‘ A ‘ Attainable
‘ R ‘ Realistic
‘ T ‘ Time
However, the most important aims are as bellow that you (Mr. Karim) should keep in your mind to make Karim’s Grocery Shop successful in this regarding field as your desire:
Statistics suggest that a learge number of new business fail within the first 12 months, therefore when a new business first starts operating, it’s main business is likely to be survival. To survive all a business has to do is ensure that it breaks evn, in other words it must ensure that the money it recieves from selling its products is at least enough to cover its outgoings.
If a business like your’s (Mr. Karim) one can servive in the short term then it may be able to set alternative long term aims such as growth or increasing profits.
Profit Maximisation – Profit Maximisation or the profit growth is the primary aim of most of the business organizations like Karim’s Grocery Shop . The basic equation of profit is the revenue minus costs. On the other hand, most shops do not expect to earn a profit in the first couple of years of their inception. Thus, most business owners list specific profit goals for at least the first five years of their operations as like you (Mr. Karim).
Growth – For most of the grocery shops one of the main aim is to increase the level of sales.. Organization / shops set this because they believe that the best way to achieve greater profits to is to achieve greater sales.
Improving the Corporate Image – For larger businesses aim is to improve the image of the shop and the brand or the product. Sometimes you (Mr. Karim) can spend some money sponsoring charitable or sporting events. While the sponsorship can be very expensive and therefore can reduce profits it should carried out in the hope that your shop’s image will be enhanced as a result which should ultimately lead to a greater level of sales.
Return on Capital Employed (ROCE) – The most important measure of profitability, also called the Return on Investment (ROI). ROCE is calculated as profit divided by long-term capital employed (in percentage). The level of profit that a business earns does not relate profitability to the amount of funds (capital) employed in making those profits.
Maintaining a Competitive Advantage – You must maintain a competitive advantage over your competitors to stay relevant to the consumer. Businesses achieve this goal through product differentiation and brand recognition.
Market Share – The percentage of the shop’s total sales that is earned by the shop over a specified time period. This metric is used to give a general idea of the size of the shop to its market and its competitors. You (Mr. Karim) can use policies such as competitive pricing strategies, advertising, and sales promotions.
Future – Company officials will discuss the long-range aims and objectives they want for the business, and what direction they see the business heading. They will determine aims for each of the other types of general aims, such as advertising and profit, and will draft out a rough plan to achieve them. These future aims will then be analyzed and steps outlined to meet objectives.
I think the aims that I’ve mentioned above will be quite effective for Karim’s Grocery Shop. Now I’m going to let you (Mr. Karim) know that how the stakeholders are related to these aims:
The stakeholders in a corporation are the individuals and constituencies that contribute, either voluntarily or involuntarily, to its wealth-creating capacity and activities, and that are therefore its potential beneficiaries and/or risk bearers. Basically A stakeholder is anyone who can affect or is affected by the actions of a corporation (organisation, company or business).
Stakeholders are generally divided into two groups; internal and external stakeholders. As the terms suggest, internal stakeholders come from within the corporation and external stakeholders are those outside the corporation but with a vested interest in it. The diagram below shows common internal and external stakeholders.
Table 1: Stakeholders and their Objectives
Stakeholders Who are they Objectives
Owners They invest capital in the business and get profits from the business Profits, growth of the business
Workers Employees of the business who give in their time and effort to make a business successful Job security, job satisfaction and a satisfactory level of payment for their efforts
Managers Employees of the business who manage a business. They lead and control the workers to achieve organisational goals High salaries, Job security, Status and growth of the business
Consumers These are the people who buy the goods and services of the business. Safe and reliable products, value for money, proper after sales service
Government Government manages the economy. The government charges a tax from the business and also monitors the working of businesses in the country Successful businesses, employments to be created, more taxes, follow laws.
The community Community is all the people who are directly or indirectly affected by the actions of the business.
. They expect more jobs, environmental protection, socially responsible products and actions of the business
How Stakeholders are Related to Business Aims
The employee would be interested in the business because they would want the business / shop to succeed and make more money than other businesses around the community so that they can earn a good wages in time.
Managers are another stakeholder. Their interest in the business would be that it runs successfully so they can earn higher bonuses.
An owner would keep an interest in the business because they would want their business to stay successful and make the maximum profits from the business.
The local community would keep an interest in the business / Karim’s shop because they would want quality and value for money when they will buy their products from the business. They would want the business to meet their standards and expectations so that they could always buy their food items and others also from there without any complications.
The government keeps an interest in the business because a huge successful grocery shop would be good for the government as it creates them with wealth and employment. The government also receives taxes from the profits that the business will make.
For a new company, free media exposure is good because it builds awareness in its products and services. For a publicly traded company, media attention can be a mixed blessing.
Financers are groups or organisations that lend loans to businesses like Karim’s Grocery Shop. They might keep an interest in the business because they want the business to do well so in addition they can have their loan repaying on time.
Customers determine an organizational or shop’s viability and profitability. The business / shop must anticipate and respond to changing customer preferences. This involves developing new product importing ideas, adjusting advertising expenses in select markets, and investing in customer service and technical support.
Suppliers provide all the products and services. The grocery shop may have to suspend operations if suppliers are experiencing financial or manufacturing problems.
When it comes to corporate mission values stakeholders will maximize the value for all stakeholders, as opposed to shareholders who only maximize the value for themselves.
Stakeholders also play a role in the decision making process in a business like grocery shop. Although since employees and customers are included in being stakeholders they too are considered when it comes to decision making.
When it comes to accountability it does not just come down to being accountable to them. Accountability lies with the customer, suppliers, community, employee and government stakeholders.
So now, at the very end of this report I want to say you (Mr. Karim) that, virtually every business needs a business plan, aims & objectives. Lack of proper planning & defining proper aims & objectives are the most often cited reasons for business failures. Business plans will help you to identify business goals and objectives and provide them with tactics and strategies to reach those goals. They are not historical documents; rather, they embody a set of management decisions about necessary steps for the business to reach its objectives and perform in accordance with its capabilities.
In order to make your grocery shop’s management more effective and to increase the sale more I’ve suggested three special departments in the functional areas such as ICT, Customer Care Service and Security. Though you are at the initiating stage of your business / shop but I’m strongly recommending you to implement these departments from the very beginning of your business because if you start your business with all of these functional areas / departments then you will be able to make a competitive strong position beating your rivals at the market.
Finally I’m telling you that if you are succeed in the implementation of the aims which are mentioned in this document then your dream regarding Karim’s Grocery Shop will come true within a short time. Best of luck for you & your Grocery Shop!