What are business activities? (With tips for improvement)
By Indeed Editorial Team
Published 5 September 2022
The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.
Companies that want to improve their overall activities can benefit from learning more about the various types of organisational activities. This requires consideration of the company's current operations and processes. By knowing more about these operations and processes, you can help your employer improve both profits and sales. In this article, we define business activities, explore their types and share additional tips you can use to improve company activities on behalf of your employer.
What are business activities?
Business activities are any activities that a business undertakes to make a profit and maintain its operations. Businesses may perform different activities depending on their size, organisational structure and the industry in which they operate. For example, a manufacturing company is unlikely to focus on service-based activities like customer service. Instead, it may concentrate more on building business-to-business (B2B) relationships with corporate clients.
Types of business activities
Organisations divide their activities into categories, which facilitates reporting and accounting processes. The three key types of business activities are:
Operating company activities
Operating activities directly impact the cash flow of a company. These are day-to-day activities that company employees undertake to complete their tasks and projects. In many instances, the success of the entire organisation depends on them. Stakeholders use information about operating activities to see the viability of the company, as it demonstrates the organisation's ability to cover its current expenses.
Generally, operating activities either generate revenue or expenses. Activities that generate revenue include customer sales or supplier refunds. Those that generate expenses include employee compensation or tax payments. Here are the most common types of operating activities:
In many organisations, sales is the core element of their operations. On a daily basis, the sales team identifies prospective leads, contacts customers, turns leads into sales and maintains long-lasting relationships with business clients. It's also essential that they track sales and negotiate prices to make sure the company earns enough money to cover its expenses. Some examples of other sales activities include:
cold emailing customers
Marketing activities serve to help promote a company's products or services. They allow members of the organisation to reach new audiences and make sure existing customers know about new deals or launches. There are different types of marketing in which companies invest, including:
Brand development: Brand development helps companies improve their position within the market and increase brand awareness, allowing customers to instantly recognise the company logo when they shop in stores and online. By implementing effective branding strategies, businesses can become more competitive.
Direct marketing: Direct marketing is the process of communicating promotional messages directly to potential and existing customers, for example, through ads or digital campaigns. More traditional forms include direct mail or telephone marketing.
Public relations (PR): PR represents the relationships that a company has with media outlets and the public. It allows members of the organisation to appear in the press, on TV programmes or on the radio to promote products or the entire company.
Networking: To maintain their operational activity, companies not only try to reach new customers but also grow their professional networks. Joining professional organisations or participating in conferences gives them a chance to analyse competition, create cross-promotion opportunities or stay up-to-date with industry news and regulations.
Finance activities help with allocating resources and making sure each department has enough time, money or human talent to support the growth of the organisation. A significant part of finance efforts involves accurate sales forecasting and budgeting. This can help a company allocate resources effectively to meet consumer demands and generate profits.
Accounting takes care of managing money that the company earns and spends. Professionals who handle accounting processes are also responsible for documenting any transactions and making sure their receipts, financial reports and statements comply with national, local and industry regulations and standards. Due to the documentation that the accounting team generates, executives can determine how the organisation spends money and if there's a way to reduce spending while maintaining or increasing revenue.
Customer service helps businesses ensure customer satisfaction with their purchases and how the organisation treats them. Customer service representatives may answer customer emails, send thank you letters or respond to their comments on social media. It's also important that companies invest in customer support, which serves to provide help when people struggle with a company's products or services.
The efforts of human resources (HR) representatives help to maintain company operations. They're also essential components of business expansions, as they facilitate candidate sourcing. Other tasks that HR departments handle include implementing employee benefit schemes, dismissing employees, recruitment or employee training and onboarding.
Investing company activities
Investing activities refer to dedicating a company's assets, like money or property, to attain an increase in value over a specific period. Many companies choose to invest on a larger scale and there are various ways in which they can do it. Some examples of investing activities include purchasing properties, other organisations' shares or marketable securities like stocks. Some executives also act as angel investors, helping new companies like startups financially in exchange for convertible debt or ownership equity.
Financing company activities
The financing activities within companies include their primary and secondary public offerings. They include transactions involving debt, equity and dividends. Reviewing a company's financing activities can help stakeholders and investors assess its financial strength and determine the effectiveness of its managerial strategies.
Ways to improve company activities
Improving company activities can help with reaching your performance goals. You can also use these tips to inspire your team or employer to implement better organisational strategies:
Clarify company goals
Setting goals and objectives is an important element of growth for both individuals and companies. You can help your employer clarify what they want the organisation to accomplish in the next year or two by carefully analysing the resources they have and assessing the organisation's potential. For example, if you establish that building brand awareness is the main goal for the company, it makes sense to invest more in operational activities, including marketing and PR efforts.
Staying up-to-date with trends provides you with valuable insight into the industry. It also allows you to understand what your competition does to promote new products, remain profitable and attract new customers. For example, you may notice that there's a shift in the way consumers discover brands online and work with the marketing director to create more video content rather than lengthy written articles.
Ask for feedback
Analysing company performance is critical for identifying its limitations and potential for growth. Working with an experienced team of analysts can help. Another, less expensive, way to do that is to encourage customers to leave reviews and comments for the business. Analysing what they say about the products or services the company offers can help you better understand how they make purchasing decisions and if there's anything else your team can do to meet their expectations and consumer needs.
Take care of employees
If you're responsible for improving company operations, it's helpful to start by working internally. One way to approach this is to understand how the employer treats employees and what benefits they offer. In some instances, offering specific departments more flexible schedules can improve the motivation and performance of staff. Offering schedule flexibility can also benefit the company's finances, as it allows them to pay less for renting offices or equipment.
Related: 20 common types of employee benefits
Implement automation tools
Automation is one of the best ways in which companies can overcome budget cuts or handle more projects without hiring more people. Technological advancements, like customer relationship management (CRM) or emailing software, can save a lot of time and allow employees to focus on more complex tasks, like designing new processes and developing creative ideas. Digital tools can also automate tasks related to accounting, customer service or even social media marketing.
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