What is the relationship between production department and finance department?


3 Answers

Connor Sephton Profile
Connor Sephton answered
The relationship is integral. The production department is involved and concerned with the making of the product or the development of the service. It is the heart of businesses as they need to provide something that the consumer wants, and in product firms, the production department deals with the making and development of a product to make the consumer want it, or feel that they need it in their life.

The finance department deals with all kinds of monetary transfer that the business is involved with, and of course the production department is one of the biggest areas of loss. The production department needs to go about creating the product and in near enough every business, there is a cost to creating the product or service. Hence, the finance department will deal with how much of the firm's funds or assets are being lost to this and will decide whether the efficiency of the business is sufficient.

The cost per unit will be monitored by the finance department and this is an incredibly important concept that overlaps between the two firms.

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Instead of relying on the Internet for answers, be sure to stick to the syllabus and use the right sources of information to write your answers. That way you can ensure that you are answering in the right context and using the right information in your answers.
amber Jhon Profile
amber Jhon answered
There is a strong interaction between the finance and production departments. For all the production costs the production department has to contact with the finance department. The aim of organizations is to increase profitability and to reduce cost and therefore, production department has to design the products which can reduce the costs incurred by the company and improve the quality of the products. Hence, finance and production departments keep interacting with each other.
Ellie Hoe Profile
Ellie Hoe answered
The conflict occurs because of shortage of resources which departments have to share and allocate among themselves. Production department might demand funds for the new equipment or new technology to improve work processes whereas finance department might have shortage of funds which can cause conflict of interests between the two departments. Similarly production department may realize need for salary increase of front line workers whereas finance department may come up with their own different analogy. For successful implementation of projects and planned goals, it is important to avoid conflict between the two departments.

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