The article discusses about the typical corporate functional teams through which the work of the organization passes through.
A typical corporate consists of several teams working in tandem to carry out the operations and to take care of compliances involved.
Various teams working in an organization are as under:
- Core Production/Service Operations
- Supply Chain Management
- Quality teams
- Research & Development (R&D)
- Finance & Treasury
- Purchase to Pay (P2P) or Accounts Payable
- Accounts Receivable (AR)
- Asset & Project Accounting (APA)/ Asset Accounting team
- Order to Cash (O2C), Sales or Revenue Accounting
- Record to Report (R2R)
- Master Data Management (MDM)
- Tax (Direct & Indirect)
- Internal Audit
- IT Support team
- Human Resource Development (HRD) & Administration
- Environment, Health and Safety (EHS)
- Corporate Communications
Let’s us discuss briefly the role of various teams and their cross-functional dependencies
Core Production/service operations team is engaged in managing the manufacturing of goods or rendering of services by getting the core operations done through casual labourers. They also record the consumption of material and stock position. They help other functions by providing them with the report of materials consumed, stock positions, wastage reports etc.. Such reports are used by costing team, direct & indirect tax team and R2R team in their respective functions. They also coordinate with the Marketing team to know about consumer demand patterns and planning production accordingly and with SCM team in the usage of raw materials, dispatching of finished product to customers. The production process involves a lot of documentation. Infact, the production team is responsible for documenting the batch-wise end to end the flow of production process.
Supply Chain Management (SCM) team – SCM team is taking care of material inward & outward movement, warehousing. SCM team support production team by managing storage of raw materials and supplying to them as and when required. They also co-ordinate in inbound & outbound movement of goods. On receipt of material or any service invoice, the receipt of same is recorded by SCM team which is known as Goods Receipt Note (GRN) Accounting. It is only when GRN is posted in system, invoice can be posted by Accounts Payable team (AP) which is known as knocking off invoice against GRN. Thus, every invoice posting gets routed b/w two teams- SCM and AP.
SCM team is also responsible for generating way bills required at the time of dispatching goods, they seek help of indirect tax team in case of any difficulties faced in generating same.
Quality Management team- Quality team test the material on the specified standards of quality. It may reject the materials if the same donot pass quality tests. They also co-ordinate in case of customer, vendor or regulatory audits of productions/service operation facilities.
Marketing team- Marketing team as the name suggests markets the product to prospective customers. They are also a link between customer and other teams of the company i.e. if anybody want to interact with customer they have to get it done through Marketing team. Marketing team is responsible to collect the required documents from customers like invoice copies, agreements, LC. They are also responsible for following up with customers in collecting dues from them.
Research and Development- R&D team undertake research activities with an objective to develop new products and to improve the quality of existing one. They mainly co-ordinate with Production and SCM team in carrying out their R&D activity.
Finance & Treasury- Finance & Treasury team by analyzing the reports from various teams like Sales, AP &AR, direct and indirect tax, HRD & Admin etc. work out the sources, requirement and usage of funds in short & long term and accordingly plan the finances to keep the business going smoothly. This function is headed by CFO. Heads of crosss functional teams like P2P, O2C, R2R, APA, Direct & Indirect Tax reports to CFO. Further, for making any exceptional payments prior approval of CFO or GM Finance is required who will seek a root cause analysis of the same. For example- Tax demands which are not being challenged by tax team and recommended to be paid off to settle the litigation. Tax team required to take the approval of CFO/GM Finance explaining as to why the demand has to be paid and the corrective measures by which it recurrence can be avoided.
Purchase to Pay (P2P) or Accounts Payable (AP): P2P/AP team is responsible to account the vendor invoices against the GRN posting done by SCM team. They are also responsible to pay off the vendors and engaged in preparing various reports relating to vendor management. They coordinate with tax teams in case of any queries arising while posting vendor invoices pertaining to taxes charged on invoice.
Order to Cash (O2C), Sales or Revenue Accounting: O2C team is responsible to generate the sales invoices and account the same into system. They are responsible to prepare various reports relating to sales like sales MIS, segment-wise sales reporting, customer credit ageing analysis etc.
Record to Report (R2R): R2R team is responsible to monitor all the general ledgers (GL). They co-ordinate with various teams at the time of GL period closure (monthly).
Asset & Project Accounting (APA)/ Asset Accounting team: APA team performs end to end fixed assets accounting. They are responsible for measuring the depreciation, impairment, fair valuation and revaluation of fixed assets which has to be done in line with the prevailing accounting standards (IND AS notified by Ministry of Corporate Affairs)
Master Data Management (MDM): MDM team is having ownership of various entity vide master data like vendor master, customer master, material master etc. They are required to continuously update the master data and share the same with various user teams. The quality and completeness of master data decide the quality and completeness of various reported extracted from system. They coordinate with various user teams to update the master data. For example: In order to update GST no. of a new vendor they will contact AP or SCM team.
Tax (Direct & Indirect): Tax team is responsible for tax compliances (filling of returns, calculating tax liability), internal advisory on tax issues to various teams, handling tax litigations, tax refunds, tax reconciliations, tax audits and so on. They will also coordinate with internal and statutory auditors to get the tax accounting and compliances get audited.
Legal: Legal team is responsible to critically examine the terms & conditions of the various contract entered into by the company and making ware the management of any adverse terms & contract which may be prejudicial to the interests of the company.
Costing: Costing team analyses the cost factors. They suggest the measures of cost control and cost reduction. They closely work with production and SCM team.
Internal Audit: Many companies are having their own in-house internal audit team which is responsible to audit the various processes both technical and others in order to find the gap between the standard operating procedure (SOP) and actual procedures used. They are required to rate the risk involved and controls failed due to deviations or gaps observed.
IT support team: IT support team are of two types viz. core IT support and system support. Core IT team will resolve the user queries/grievances with respect to usage of computer systems in general. System support IT team helps users in resolving their queries relating to use of applications like SAP, Oracle or software used by the company for any process. They also work for enhancement or upgradation of the systems due to changed user needs.
Human Resources Development (HRD) and Admin: HRD team is responsible for end to end recruiting function, performing compliances to labour laws, initiate employee development activities and resolving employees queries and grievances pertaining to work and other matters. In HRD team, there will be HR Business Partners (HRBP) working at the mid-level of HRD hierarchy to whom any matter requiring serious attention may be escalated.
Admin team is responsible for administration work of the company which includes travel facility management, canteen, housekeeping, security and company’s assets management (other than business assets)
Environment, Health and Safety (EHS) : EHS team is responsible for the well-being of human resources working in the company as well as of the environment. They provide training to the people to explain them how to work safely. They are also responsible to suggest measures to minimize the damage to the environment due to the company’s operations.
Corporate Communications: Corporate Communications is the link between company and outside world, they only represent the company at various media events. They also make aware the people working of the various initiatives carried on and various achievements made. They only handle the company’s handle on social networking websites like twitter, facebook etc. They generally report to MD or CEO.
Security: Security team is generally not working on the rolls of the company but yet have very important role to play. They are responsible to control any unauthorized movement of material or human being in or out of the company. They report to the Admin team.
All the teams are the dependent on one another and major operational success of organization depends on how well these teams coordinate with one another by providing timely and accurate information to one another.
Thanks for reading the article. Your queries and suggestions are most welcomed.