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Managing your business is no walk in the park, especially considering the tough market competition nowadays.
When you start your own business, you need to carry all its weight on your shoulders, from conceptualizing your next advertisement, hiring or firing staff, and even taking care of your inventory.
This is exactly why most business owners easily get overwhelmed.
Thankfully, it is possible to simplify how to manage your business. If you want to have a look at the right way to approach business management, this guide is for you.
What is Business Management?
Business management refers to the organization and coordination of all activities related to your business. As a business manager, you are responsible for overseeing operation and enabling your staff to maximize their skills and resources to reach optimum productivity. Business management also covers the training of new employees to reach financial and operational milestones.
Business management does not only involve the manager and the staff. It also covers utilizing all resources including finance, equipment, and technology in an efficient manner to fill gaps in operations and solve strategic issues.
Types of Business Management Styles
The types of management styles can vary depending on the situation. The different factors that affect the types of business management styles are the following:
- Corporate culture
- Employee engagement
- Skill level of staff
- Employment laws
- Market condition
Keep in mind that any effective business owner can adjust his or her management style depending on the situation, and still keep their focus on achieving their targets. Here are the different styles you should know.
This type of management style is characterized by a top-down approach to leadership. Managers and leaders who follow this style make decisions alone, and they are also responsible for setting policies for employees to follow.
Usually, feedback is not requested from the staff.
This type of style is effective when there is a crisis and when managers need to make a quick important decision.
However, because only one person is in control, innovation is limited. If the manager is tough, it can also result in a high employee turnover.
As its name implies, this type of business management style happens when managers ask their staff for feedback.
The feedback and concerns of these people are taken very seriously so those within the organization can wholeheartedly share what they think is and isn’t working. But despite the open communication within the organization, the manager still has the final say.
This management style is great for those who want to improve employee engagement. However, it’s not the best autocratic style because there are many people involved in influencing minor and major decisions.
This type of business management style is when employees can heavily influence decision-making processes within the company. It’s amazing if you want to foster openness among all levels of the organization.
It is also a solid long-term growth strategy because employees feel empowered.
However, those who use this style always encounter debates. Consultation is also needed and this can delay decisions.
Managers who use this style serve as mentors to employees, not leaders. Their goal is to guide employees through every decision on how they can move forward.
When it comes to this style, monitoring is extremely important. However, managers still should not get heavily involved with individual projects.
Laissez-faire management style allows employees to become self-motivated. But because it is a hands-off approach, many employees may feel neglected.
For this management style, managers still have the power to make decisions. What makes it unique is that they make employees understand why the decision was made and how it can benefit the company.
By sharing their reasons behind a decision, they can make the working environment more inclusive.
This is an effective business management style to motivate employees especially when your team is less experienced, and it is also preferred by many compared to the authoritative style. However, it’s still very one-sided.
The main goal of this management style is to inspire innovation. Those who follow transformational business management motivate their employees to reach goals by pushing them out of their comfort zone.
This is an amazing style to follow if you want your staff to reach their full potential because it improves their problem-solving abilities. However, it will only work if you have the right employees who are ready to adapt and learn.
The rationale of managers who follow this style is when their staff feels fulfilled, they will be more productive. The collaborative management style is mainly focused on employee satisfaction.
Because of this, it’s one of the best styles to follow for organizations of any size, especially non-profits.
Because collaboration is highly valued, the staff is immensely loyal to the organization.
However, leaders may get burnt out fast, and it may be challenging to inspire strategic planning.
17 Ways to Improve your Business
If you’re like other entrepreneurs, you may be feeling stuck and uninspired to think of ways to improve your business. We’ve rounded up the best business tips to try below to help your business grow.
1. Prioritize your finances
Whether you have a small or big business, you need to fully understand your financial standing.
If you do not have the financial skills to keep track of your daily, weekly, monthly, quarterly, and annual financial transactions, hire an accountant.
This professional will help you gain valuable insight on how you can steer your business to become more profitable.
2. Familiarize yourself with key information
As much as you can, stay on top of key information. Know your net profit, cash on hand, credit score, and gross margin.
Aside from your finances, make sure to know your target audience from head to toe by heart.
3. Always set SMART goals
Running a business without setting goals is like driving a car with blindfolds on. However, setting any goal is not enough. Your goal has to be the following:
S – specific
M – measurable
A – achievable
R – relevant
T – time-based
For example, if you want to increase your website traffic, you need to specify by how much, as well as the time constraint.
So instead of writing “increase traffic drastically,” it should be something specific like “increase website traffic by 150% within 6 months.”
4. Think about marketing
A lot of business owners think they need a huge budget for marketing. However, there are many ways you can develop a real connection with your audience without breaking the bank.
Start by testing new marketing tactics, and by the end of the quarter, examine the metrics and see which of them performed best. Leverage the power of social media and SEO to build your brand authority.
5. Learn how to make business presentations
As a small business owner, you need to learn how to make attractive business presentations to capture your audience.
Every time you present to a wide audience, make sure your presentation is not overloaded with text.
6. Monitor trends
No matter how successful your business is now, you need to stay on top of trends if you want to remain relevant.
As much as you can, read the news and current trends in your industry and community.
For instance, video has emerged to be the top content form today, with 84% of consumers1 saying they’ve been convinced to buy a product or serve after watching a video. If you continue to ignore trends, you will be overshadowed by your competition.
7. Improve your selling skills
Whether you have a sales team working for your brand, or you’re a one-man team, you need to find ways to improve your selling skills.
Put yourself in the shoes of your customers and try to assess what they want to see and experience from your brand. More than that, you can also find a mentor, or ask for feedback.
8. Don’t forget about your staff
You’ll be surprised at how your business will skyrocket if your staff is highly motivated. As a business owner, you must motivate your employees and keep them happy.
Do this by giving them fair compensation, and encouraging them to achieve a work-life balance. It also helps to ask for their insight so they feel valued regardless of their position.
9. Set limitations
Nobody is a perfect leader. Whatever business management style you follow, you need to be self-aware. For instance, if you’re great at conceptualizing business marketing plans, but you don’t excel in graphics, hire someone to do it for you.
Understandably, a lot of business owners feel reluctant to let others take the reins of their business, but delegating tasks to people who know what they are doing will save you time and effort. It will also lead to better results.
If you have employees, you can train them to do time-consuming tasks. If you can’t afford to hire a full-time staff, hire a gig worker to take care of a specific task such as writing your captions on social media.
10. Value breaks
No matter how small your business is, running it without taking a break will take a toll on you. The best way to be the best leader is to take a step back and rest.
Book a flight to Siargao, visit your relatives in the province, spend one full day watching Netflix – whatever it is you want to do, do it. Who knows, this may be the secret ingredient to reigniting your passion.
11. Protect your cash flow
One of the best-kept secrets of successful entrepreneurs is their discipline to manage their cash flow. This is evident in the acronym “CFIMITYM” or “Cash Flow Is More Important Than Your Mother.”
Keep in mind that one of the most common reasons why businesses fail is due to lack of cash flow.
The goal of every business owner is to always have a positive cash flow. You can do this by adjusting your expenses, extending your payables schedule, adjusting inventory levels, obtaining a loan for emergencies, and accelerating your receivables collections.
As much as possible, create a cash flow plan for the next two months so you can allocate funds better and prevent issues.
12. Invest in automation
When it comes to running a business, remember that technology is your friend. You need all the help you can get to save time and money. You can do so by automating some of your processes.
For instance, you can use apps to track your inventory, set up automatic bill payments, schedule your posts on social media, and even record timesheets. Usually, these apps only have a short learning curve.
You can also automate your to-do lists and make it easier for you to schedule plans and keep track of important tasks.
Automation may take a significant investment so make sure to weigh the pros and cons before you take the plunge. Thankfully, there are also free apps and services available today.
Related: Business Development 101
13. Don’t rush employee training
The moment you hire additional staff, you may think you can have time to rest and take a vacation. However, it will take some time before you can offload some of your tasks to this person.
This is because they still need to learn the ropes of your business before they can start doing relevant work.
Give your new staff ample time to learn the ins and outs of your business processes, and make sure they are equipped with all the resources and training materials they need to learn fast.
When you train new employees right and set clear expectations from the start, you can avoid high employee turnover.
14. Build your online presence
Many marketers put all their effort into their content that they forget the important things in their social media and website, such as their call to action, contact numbers, and other key information.
When you have established your presence on the internet, maintain a good impression by offering good customer service to customers. As much as you can, respond to questions and comments within the day.
Another great tip when it comes to leveraging the power of your online presence is to be present in as many channels as you can.
This can include email, your online store, Facebook, Tiktok, Instagram, and many more.
After a few months of trying out this multi-channel approach, see which ones are the most effective in reaching customers, and then zero-in on those that have proven to provide great results.
15. Build customer relationships
Acing your social media strategy is not enough, you also have to nurture your relationship with potential and current customers.
Customizing your content, offers, and services may take a lot of time and effort, but you will be rewarded with loyal customers who will not hesitate to share your brand with their peers.
16. Offer strong security
One of the things customers expect from business owners is cybersecurity. You should have a strong cyber security infrastructure in place especially if you take payments online.
The last thing you want is to leak important information to cybercriminals. To do this, only use trusted platforms and payment gateways, and update your software consistently.
17. Attract tomorrow’s workforce
The way Gen Z professionals choose their employers is extremely different from the previous generations. If you want to leverage the next generation of effective workers, make sure you ace your company’s reputation.
More than that, rework traditional interview questions to inspire potential hires to use their wits and creativity.
You can also explore a work from home setup for some of your business’ operations. This could not just attract more talent to your workforce, but could also help cut costs from your business’ monthly operational expenses.