Functional Manager

A Functional Manager's job is to optimize the efficiency of the assigned function and to coordinate strategy across functional boundaries. Functional Managers assume responsibility for an entire department:

• Research & Development (R&D)
• Marketing
• Production
• Finance

Functional Managers are the authority for all rules that apply to their area.

Efficiency Concerns

R&D Managers should monitor project completion dates. Since the rules require that projects can only begin on January 1, projects that did not finish last year "lock out" a new project for that product this year.

Marketing Managers should monitor promotion and sales budgets. As these budgets increase, they experience diminishing returns. Price drives product margins, but Marketing Managers must be sure it is appropriate for the intended segment.

Production Managers should monitor inventory levels, plant utilization and overtime. These factors vary with automation levels. For example, running a second shift for a product automated to 10.0 (the upper limit) is different than for an automation level of 1.0.

Finance Managers should monitor cash positions, and, more broadly, the capital structure of the firm. Does the capital structure support the performance measures selected by the team? Is sufficient working capital on hand to weather a sudden surge in inventory?