Business Management

Key Management Skills for Success

To run a successful business you need a diverse range of business management skills. Here are some of the keys areas of successful management.



1. Time Management:
Having time management skills is simply having the ability to recognize and solve time management problems. It is as the old adage says, to never put off for later what can be done right now. You can develop this personal management skill by keeping a calendar and beginning to schedule everything including scheduling free time.

2. Financial Management:
The keys to successful financial management revolve around the ability to create wealth for the business, generate cash, and provide an adequate return on investment for owners of the business.

3. Communication Skills:
Business is all about people regardless of your industry and you will encounter a range of people on a daily basis in the operation of your business from customers and suppliers to employees and business associates. With great communication skills comes the power to influence and encourage others and yourself.

4. Leadership:
A true leader inculcates feelings of confidence, admiration in the followers and a sense of commitment towards the business. A leader influences others to follow him. Leaders need to be flexible, adaptable to change and encourage these qualities in the team members too. Being innovative is important for business growth. Innovation is a skill in itself. Leaders need to be open to new ideas, they need to innovate, bring in positive change as and when needed and progress.

5. Foresight:
This is important in business management. You need to be able to sense trouble ahead of time. You need to be prepared for it and plan accordingly. You need to think ahead of time to be ahead in the industry. An excellent example of a manager and business developer with foresight was Steve Jobs. You can't just ask customers what they want and then try to give that to them. By the time you get it built, they'll want something new, he said. He believed in anticipating customer needs in advance to be able to give them products they would start wanting.

Management is about taking the right decisions at the right time and getting them implemented by the right people. Effective business management requires you to have a variety of basic skills. The skills outlined here certainly are not all inclusive. Perhaps, the most important thing you need to have is common sense.

Business Management

Ways to preserve cash

Conserving cash can create benefits in economic conditions facing business today. When business is in a slow growth pattern, cash is very important and if you don’t have cash when you need it the most operations can be constrained and the business may fail.

Preserving cash may not be easy for those businesses that have been used to having the money to spend at any time. However, when some belt-tightening is necessary, some practical cash preservation methods may be prudent.
Here are a few tips:
• Spend wisely. Make sure that purchases are made for need to have not nice to have items. Items should have a focus on producing revenue where possible.
• Ensure new employee hiring is necessary. Employee salaries are a significant cash drain so efforts to maximize productivity from current employees should be a first step.
• Lease equipment. Leasing vs buying can be an important option since equipment purchasing can be a serious cash drain.
• Plan ahead. Make sure you forecast financial activity. A plan outlining expected revenues and expenditures is vital to understanding cash needs. You certainly want no surprises on cash flow activity.
• Renegotiate leases. Rent is often a sizeable fixed cost that can be negotiated. Speak with your landlord; there may be an opportunity to downsize or even temporarily obtain rent reductions. Landlords often prefer to accept lower income than losing tenants.
• Go to the clouds. If your business is large enough to have in-house servers you are aware of the maintenance costs. If business is increasing this may be a cost effective way to create additional capacity without buying expensive new servers.

Business owners should share their cash flow objectives with other key managers to ensure every opportunity to maximize cash savings is realized.

I hope these thoughts are of value as you manage this key resource. Remember: banks don’t usually give you a second chance to run out of money.

Business Management

Business Principles to follow for Success

Business owners don’t often think about basic operating principles but here are a few thought starters to ponder on what fundamentals might help drive the business successfully.






1. Measure risk
In early stages you can have an appetite for greater risk as there is lots of time to recover if you misstep. As the business and ownership matures perhaps a more prudent approach to risk taking is appropriate.

2. Maintain control
Take a hands-on approach to accounting and record keeping and take ownership of results. Gaining control of information allows you to end any dubious activities promptly.

3. Communicate, Communicate, Communicate
Whether it is with investors, customers, co-workers, or business partners, you have to over communicate.
Listen carefully, communicate regularly, and try to be clear and concise.

4. Be Respectful
Treat others with the utmost of respect. Regardless of differences, positions, titles, ages, or other types of distinctions, always treat others with professional respect and courtesy. Value every individual for their unique skills and contributions.

5. Build a network
The activity of building a network of contacts within the industry and the local business community will be invaluable in the long term. Attending networking events and community activities can expand awareness of the business and expose potential future consumers to your products or services.


There are many other principles that could be added to the list; these should provide some input to how you operate your business.

Business Management

Why Businesses fail

There are many reasons businesses fail and these have been well documented. This blog will serve as a reminder to some of the more common issues and I hope create additional focus by owners to avoid the same failure.



1. Weak Management
New business owners frequently lack relevant business and management expertise in areas such as finance, selling, production, and managing employees. Unless they recognize what they don't do well, and seek help, business owners may soon face issues of a failing business.

2. Insufficient Capital
A common fatal mistake for many failed businesses is having insufficient operating funds. Business owners underestimate how much money is needed and they are forced to close before they even have had a fair chance to succeed. They also may have an unrealistic expectation of incoming revenues from sales.

3. No long-term plan 
Often there is a focus on short-term profits. It is obvious that there must be profits but this should not be at the expense of building a long term value in the business and understanding the potential of long term customer relations. Building value requires hard work and planning based on good current information and a realistic forecast of the future.

4. Uncontrolled growth
Seem surprising? Too much growth? Over expansion can be fatal if the business does not have the resources to cope with growth including appropriate financing, personnel and capacity to meet demand. Sometimes less is more.

5. Poor Information
The business cannot be managed if owners do not know what is going on. Without accurate financial information the business is flying blind. Don’t expect the accounting firm who does tax filing to keep track of day to day business; that must be handled within the company by the CEO or top finance person.

6. Inefficient operations
Paying too much for rent, labor, and materials weakens the bottom line. The leanest companies are at an advantage and usually are more flexible and adaptable to market change. Not having the tenacity or awareness to negotiate terms that are reflective of today’s economy may leave a company uncompetitive.

The marketplace is rarely forgiving and owners need to eliminate missteps that certainly are avoidable with a little insight into business management.

Business Management

Business Growth In Slow Economies

It can be difficult to grow a business anytime but properly managed small businesses can thrive in even poor economies. Here are steps to consider when facing challenging markets:





1. Manage costs: To stay ahead of the curve businesses have to cut costs with the precision of a surgeon. Cut too little and the company’s survival may not be assured; cut too much and the business may jeopardize the quality service offered to customers.

2. Broaden the customer base: The business is at risk if too much dependence is placed on a few customers who could develop financial difficulties. Spread the risk and reliance by having as large a base of stable customers as possible. At the same time give important customers special attention, nurture relationships that will build loyalty.

3. Refine Marketing: Refine key selling points and use new internet based marketing to attract a new generation of customers. Take full advantage of free social networking; Twitter and Facebook may offer new free ways to advertise. Combine this with other direct marketing approached to reach customers.

4. Manage assets and profits: Many businesses focus on sales, expenses, and margins and often ignore assets, particularly cash flow. Profits and hence net worth can be increased through cash flow management. Prudent management of needs with both short and long term sourcing of funds with a plan developed in conjunction with a banker can be a strong tactic to ensure growth.

5. Maintain flexibility: Businesses must stay alert and respond quickly to market changes. Pay attention to market feedback and analyse facts. Adapt new systems and use current technologies to facilitate response.

Finding the optimum balance between sales and expenditure will guarantee growth in austere times and enable business to thrive when the market improves.

STRATEGIC PLANNING

Strategic planning is an investment in the business.

Let’s review a few key factors on Strategic Planning that help small business owners determine the value of this process.





1. WHAT IS IT?

- A planning tool for management to formulate high-level business strategy.
- Strategic Planning provides the foundation for the development of a more detailed Business Plan.
- Strategic Planning is top down: Strategic – Tactical – Operational.


2. WHY DO STRATEGIC PLANNING?

- To define the precise mission of the firm.
- To measure the competitive environment.
- To prioritize external opportunities and assess potential threats.
- To help manage growth.
- To focus on key objectives.
- To satisfy succession planning needs.
- To focus on internal strengths and overcome weaknesses.
- To formulate strategy to maintain a competitive position.


3. WHEN TO DO STRATEGIC PLANNING

- When the business needs to establish guidelines for a new or updating of a Business Plan.
- When a review is needed to maximize resource utilization.
- When the business needs to prioritize growth options.

4. What are the goals for Strategic Planning

- Quantify objectives for the business.
- Establish indicators of achievement.
- Develop an implementation plan.
- Assign responsibilities and accountability.
- Identify resource requirement for plan achievement – financial, personnel, equipment, facility, products.


Creating, articulating and sticking to your vision is the single most important job you have as a leader. Strategic planning isn’t a one-time event. Once you’ve laid out your strategy, it’s crucial to stay focused over the long-term.

I hope you are able to plan for success.
   

Keys to Managing Success

Let’s look at some key factors that contribute to business success. The role management plays is critical and management must focus on and achieve the goals and objectives set for the business. This is accomplished with a number of key management functions.





1. Planning: 
The key to your success is having a business plan in place. Whether you're about to launch a start-up or you've been in business for years, your business' direction is guided by your business plan. To begin the planning process, you'll need to do some critical analysis; business planning is about realistically forecasting where your business is going.

2. Organizing: 
Organizational design is the way in which you set up your company (employees, information and technologies) to best meet your business objectives. How you structure your business has a major impact on how well it functions. There is no single best organizational design for all small businesses. Each business structure is as unique as the organization it represents.

3. Leadership:
A leader is someone who has a vision, a drive, and a commitment to achieve beyond that vision. The leader must then also have the skillset to enlist the support of others in the organization to achieve the stated goals.

4. Controlling:
Many small businesses lack proper control systems because they are focused on production or service issues.
Having a control system allows you to monitor measure and adjust your organisation’s performance, whether it is sales, production capabilities, or general efficiencies. In other words, the purpose of business control is to identify unfavourable business performance so appropriate actions can be undertaken.

5. Communicating:
Communication is essence of management. The basic functions of management as shown, planning, organizing, leading, controlling cannot be performed well without effective communication. Business communication involves constant flow of information and receipt of feedback. This is essential for the growth and success of the organization.

In the end, management will determine the success or failure of a business. Success surely cannot be attained without decent management skills.