Business Management

Managing Business Development

Effective management is the key to the establishment and growth of the business. The key to successful management is to examine the marketplace environment and create employment and profit opportunities that provide the potential growth and financial viability of the business. Despite the importance of management, this area is often misunderstood and poorly implemented, primarily because people focus on the output rather than the process of management.

Business managers sometimes become absorbed in improving product quality, sometimes ignoring their role vis-a-vis personnel. The focus is on reducing costs and increasing output, while ignoring the long-term benefits of motivating personnel. This short-sighted view tends to increase profits in the short term, but can create a dysfunctional long-term business environment.

In large businesses, planning is essential for developing a firm's potential. However, many small businesses do not recognize the need for long-range plans. Nevertheless, the need for planning is as important in a small business as it is in a large one.

There is a need to manage both the External Environment and the Internal Environment. This article deals with some of the key Internal Environment issues.

1.     Ensure open communications

Effective communications play an integral role in managing and operating any successful business. With open communications changes and their effects on the organization are quickly shared. Your firm then has the time and skills needed to respond to changes and take advantage of evolving opportunities

2.     Balance schedules, stress, and personnel

Without organization and good management, the compressed time schedules associated with modern business can cause stress and make extraordinary demands on people. An effective management structure can reduce stress and channel the productive capacity of employees into business growth and profits.

3.     Define duties and responsibilities

An organization is characterized by the nature and determination of employees' duties and responsibilities. While many organizations use different methods for determining these, it is essential that they be clearly defined. The core of any organization is its people and their functions. Duties, tasks and responsibilities often evolve in an ad hoc manner. A typical firm starts with a few people, with often one person performing most duties. As the firm grows, others are hired to fill specific roles often on a functional basis. Roles that were handled by consultants and specialists outside the firm now are handled internally. As new needs emerge, new roles are developed.

4.     Control conflict

Another key to successful management lies in controlling conflict. Conflict cannot be eliminated from either the business or the interpersonal activities of the enterprise. A measure of the organization's success is the degree to which conflict can be exposed and the energies associated with it, channelled to develop the firm.

5.     Establish authority

The central element of organizational management is authority. Through authority your firm develops the structure necessary to achieve its objectives. The authority that once was conferred by either owning a small business or having a position in the bureaucracy of a larger firm has been replaced by technical competence. Once the owner-manager controlled the entire business, but suppliers, customers, unions and the government have severely limited the ability of the business owner-manager to take independent action. A primary component of authority is the exercise of control within the organization. A thorough system of controls ensures the firm's operation and provides a mechanism for imposing authority.

Successful management is founded on the mastery of a myriad of details. While management schools teach the importance of focusing attention on major issues affecting the business, practical managers realize the major issues are the variety of small aspects that form the business. In an increasingly structured society, inattention to even one minor detail can result in significant disruption of the business or even its failure.

Business Planning

Succession Planning

Succession Planning is actually about putting in place a strategic business plan for your business which allows you outline your business and personal goals and relates directly to your ability as a business owner to extract the maximum amount of value from your business when you exit, to provide for your retirement planning needs.

Planning for the day you leave your business is a valuable investment. Whether you decide to sell up, retire or have to get out of business due to health reasons, it’s important that you spend the time with your family and/or your business partners and plan what you are going to do. A succession or exit plan can help you outline what will happen and who will take over your business when you leave.

A good succession plan enables a smooth transition with less likelihood of disruption to operations. By planning your exit well in advance you can maximise the value of your business and enable it to meet future needs.

Is there a legal document that dictates the terms of the succession? If so, what are the terms? Are there any contracts that need to be modified in the event of the succession, e.g. partnership contract? Are there any new contracts that need to be drawn up?

If you are in a partnership do you have a buy-sell agreement in place? What are the terms? Will the remaining partner(s) buy your partnership share or will it be open to external partners/family members? Does this arrangement apply to all partners in the organisation?

Make sure your succession plan is attainable - set a realistic timetable and measurable milestones along the way and stick to them. As time passes your circumstances may change and having your succession plan up to date will ensure you are always ready in the event you need to leave earlier than anticipated.

Business Management

Make Better Business Decisions

Making a decision is one of the most powerful acts for inspiring confidence in leaders and managers. Yet many bosses are sometimes squeamish about it. Some decide not to decide, while others simply procrastinate. Either way, it's typically a cop-out -- and doesn't exactly encourage inspiration in the ranks.

It can help to learn how to make better decisions. You'll be viewed as a better leader and get better results overall. Here are five tips for making quicker, more calculated decisions:

1.     1. Stop seeking perfection. Many great leaders would prefer a project or report be delivered only 80% complete a few hours early than 100% complete five minutes late. Moral of the story: Don't wait for everything to be perfect. Instead of seeking the impossible, efficient decision makers tend to leap without all the answers.

2.     Create a constructive environment. For successful decision making, make sure you establish an objective, involve stakeholders, hear others opinions, and ask the right questions.

3.     Generate Good Alternatives. This step is still critical to making an effective decision. The more good options you consider the more comprehensive your final decision will be. When you generate alternatives, you force yourself to dig deeper, and look at the problem from different angles. If you use the mindset ‘there must be other solutions out there,' you're more likely to make the best decision possible.

4.     Don't problem solve, decide. A decision can solve a problem, but not every problem can be solved by making a decision. Instead, decision making often relies more on intuition than analysis. Deciding between vendors, for instance, requires examining historical data, references and prices. But the tipping point often rests with your gut. Which feels like the right choice?

 

5.     Communicate Your Decision, and Move to Action! Once you've made your decision, it's important to explain it to those affected by it, and involved in implementing it. Talk about why you chose the alternative you did. The more information you provide about risks and projected benefits, the more likely people are to support the decision.

An organized and systematic decision-making process usually leads to better decisions. Without a well-defined process, you risk making decisions that are based on insufficient information and analysis. Many variables affect the final impact of your decision.