Functional Approach to Internal Analysis
FUNCTIONAL APPROACH TO INTERNAL ANALYSIS
INTRODUCTION
The purpose of the internal analysis is to evaluate how the company is doing, so that its efforts can be directed in the most effective and efficient way. It s a Decision making approach in which a problem is broken down into its component functions (accounting, marketing, manufacturing, etc.). These functions are further divided into sub-functions and sub-sub functions ... until the function level suitable for solving the problem is reached.
Every organization of a given type must perform certain jobs in order do its work. For example, key functions of a manufacturing company include production, purchasing, marketing, accounting, and personnel. The functions of a hospital include surgery, psychiatry, nursing, housekeeping, and billing. Using such functions as the basis for structuring the organization may, in some instances, have the advantage of efficiency. Grouping jobs that require the same knowledge, skills, and resources allows them to be done efficiently and promotes the development of greater expertise.
Functional analysis is a tool used to express the needs of a client/user in terms of functions and performances expected, instead of focusing on a solution. In other words, the problem is presented without thinking about the solution.
To accomplish this, the buyer must identify, sort, characterize and prioritize the needs of a client (internal customer).
Functional analysis is the basic tool for Value Management. Value is the ratio between the level of client satisfaction and the relative cost of a product or service. Value Management is a method to increase value to clients.
Functional analysis is a support to better identify clients needs in order to increase their satisfaction at the lowest cost.
The Functional Specification of Requirements is the end product of the Functional Analysis. It is the document that formalizes the client’s needs.
It is a technique used to identify the labour
INTRODUCTION
The purpose of the internal analysis is to evaluate how the company is doing, so that its efforts can be directed in the most effective and efficient way. It s a Decision making approach in which a problem is broken down into its component functions (accounting, marketing, manufacturing, etc.). These functions are further divided into sub-functions and sub-sub functions ... until the function level suitable for solving the problem is reached.
Every organization of a given type must perform certain jobs in order do its work. For example, key functions of a manufacturing company include production, purchasing, marketing, accounting, and personnel. The functions of a hospital include surgery, psychiatry, nursing, housekeeping, and billing. Using such functions as the basis for structuring the organization may, in some instances, have the advantage of efficiency. Grouping jobs that require the same knowledge, skills, and resources allows them to be done efficiently and promotes the development of greater expertise.
Functional analysis is a tool used to express the needs of a client/user in terms of functions and performances expected, instead of focusing on a solution. In other words, the problem is presented without thinking about the solution.
To accomplish this, the buyer must identify, sort, characterize and prioritize the needs of a client (internal customer).
Functional analysis is the basic tool for Value Management. Value is the ratio between the level of client satisfaction and the relative cost of a product or service. Value Management is a method to increase value to clients.
Functional analysis is a support to better identify clients needs in order to increase their satisfaction at the lowest cost.
The Functional Specification of Requirements is the end product of the Functional Analysis. It is the document that formalizes the client’s needs.
It is a technique used to identify the labour
References: Michael A. Hitt, Robert E. Hoskisson & R. Duane Ireland, Management of Strategy Concepts and Cases. Seventh Edition, 2007.