The Importance of Functional Strategies

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A functional strategy

A functional strategy refers to any plan that each functional branch of an organization adopts and implements with the aim of contributing towards the achievement of the overall corporate goals (Moore, 2011). The various functional divisions, for instance, the operations department, human resource management department among others, all come up with certain objectives which if met by the specific employees contribute towards the overall success of the organization. The operations and the marketing are amongst the most effective functional strategies that contribute to the achievement of organizational goals.

Operations strategies and marketing strategies

Operations strategies refer to functional strategies applied by the operations department of an organization to support effective infrastructure purchase and production (Nath, Nachiappan, & Ramanathan, 2010). The main goal for these strategies is maximizing production at the most minimal costs possible. This could be done through inventory management, optimization of the supply chain, a steady and frequent creation of a new product among other ways (Stevenson, 2005). Marketing strategies, on the other hand, refer to functional strategies applied by the marketing department of an organization to ensure that their products acquire and retain market share (Nath, Nachiappan, & Ramanathan, 2010). Marketing strategies basically create a blueprint for building and maintaining clientele for an organization's products. This could be done through the introduction of new products or even advertisement.

Working together to achieve economies of scope goals

The two strategies work together to achieve economies of scope goals. Some of these goals could be the acquisition and retention of competitiveness, profit maximization, and production cost reduction. Combining an operational strategy such as supply chain optimization and proper advertisement ensures that the competitive aspect of the organization is enhanced while still minimizing the production costs. Increasing the variety of goods and services, that a firm produces, results in a decrease in production costs making it necessary to adjust the operations and marketing strategies (Moore, 2011; Nath, Nachiappan, & Ramanathan, 2010). The best corporation example is which has managed to achieve a competitive advantage over other phone companies (Nath, Nachiappan, & Ramanathan, 2010). This proves that indeed increasing variety reduces the production costs while adding competitiveness.

Enabling organizational success

Functional strategies enable the various functional levels of an organization to chip in towards the overall goals of the enterprise. Both marketing and operation are sub-branches of functional strategies whose roles are aimed at achieving economies of scope. A combination of all these ends in increased productivity and organizational success.


Moore, J. I. (2011). Strategy and Strategic Management: Theory and Practice at Enterprise, Corporate, Business and Functional Levels. Penguin UK.

Nath, P., Nachiappan, S., & Ramanathan, R. (2010). The impact of marketing capability, operations capability and diversification strategy on performance: A resource-based view. Industrial Marketing Management, 39(2), 317-329.

January 19, 2024

Business Economics

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