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Introduction to Small Business Management

Updated on October 10, 2014

Is Your Business a Train Wreck?

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What is Small Business Management?


What is business management? Stated simply it is the sum of all procedures, policies and actions that make a business work. A small business, especially a startup, faces an immediate problem: lack of structure. There is a sort of structure, to be sure, but it is usually not one imposed by the owner/manager, but by circumstances. Why is this so? A new business is an exciting thing, perhaps too exciting. The owner is often guilty of observing events as they show up rather than arranging things with a goal in mind. This article is about business management, specifically about small business management, and the basics of running a business enterprise. those things that the owner has to do if the business is to be a success. It's all about business management.

A Business Plan

Before you open your doors you should have a business plan. Most business people realize that they should have a business plan but put it off because it seems to complicated. But without a business plan your company is subject to the vagaries of events as they unfold. Imagine a load of very unpleasant stuff hurling rapidly toward a fan. You will also miss a lot of opportunities and get caught up in a lot of crises. If you don't set goals you have nothing to aim for. Your number one goal should be to write a formal business plan, not just some ideas jotted down in a notebook but a formal plan. Software, such as Business Plan Pro can help walk you through the steps. Some business owners hire a business consultant to help write the business plan.

A business plan is a tool for management, but it is also a necessary document to have on hand if you seek financing, either equity or debt. If you are looking for someone else's money, that person wants to know how it will be a sound investment and how you plan to make it so.

A business plan is never really complete, at least not if you are serious about it. The worst mistake a new business owner can make is to file the plan away and never look at it again. Think of a business plan as a dynamic document. Make an appointment with yourself to consult it at least once a week. Make amendments and changes as necessary, and don't forget to date the changes. Some businesses start out in a shared office suite, and then move on to larger quarters. This should be in your plan

Hiring Employees

Entrepreneurs Like to see themselves as good judges of character and talent. This may be so, but in the area of hiring and managing personnel, following gut instincts is a mistake. As you gather resumes, read each one carefully, very carefully. A resume is an opportunity for a job applicant to show the reader that the person behind the resume will make a good employee. There is no excuse for a typo or a mistake in a resume. The applicant has the opportunity to proofread it and to have others do so as well. Ask yourself: Do you think the person will stop making mistakes if you hire him?

The formal job interview is another area where you need to exercise cautious management rather than rely on a misguided belief in your judgment of human nature. An interview is a show where both the interviewee and the interviewer put on their best act. The interview is important, but good business management requires that you follow it up by calling references.

Marketing

Marketing, as distinguished from actually making a sale, means telling as many people as possible what you do and telling them constantly. Marketing is a more dynamic activity than it was just a few short years ago. Social media sites such as Twitter, Facebook or LinkedIn have opened up a new marketing universe for the entrepreneur to capitalize on. If you don't know about social media already, learn about these sites and use them. Take a seminar if necessary.

Social media hasn't replaced traditional marketing but enhanced it. You still need to use all of the good old marketing tools. Good business management means putting these ideas in the marketing section of your business plan. Here are just a few:

· Networking. There is no better marketing than face-to-face contact. Join appropriate organizations and go to meetings. Most of all, participate and make yourself useful to the organization. Nobody wants to listen to a constant sales pitch. Bring value to the organization and the organization will deliver value to you.

· Public Speaking. If you hate public speaking and, like many people, are even afraid of it, you need to challenge yourself. Public speaking is a wonderful opportunity to put yourself in front of groups. If you're not a speaker, become one. The good old Dale Carnegie Course is still alive and well and helping people overcome their dread of speaking in public. Check them out at www.dalecarnegie.com.

· Website. There is no such thing as a business that can't benefit from a well done website. If you can't afford to hire a website designer and don't know how to do it yourself, check out such companies as Network Solutions or Godaddy. These companies will not only host your site but will provide you with simple to follow templates for designing your own site. They are very inexpensive.

Managing the Business

Business management is more than just telling people what to do. It's keeping on top of every aspect of the business, from finances to marketing to sales to human resources. Learning how to delegate and set up accountability procedures is nothing more that sound business management. Some entrepreneurs learned this while working at a job. Others went to school for it. Some people have a natural knack for management. Some are jerks. How you manage and how you are viewed by your employees and customers is up to you.

Some Simple Tips for Good Business Management

  • Keep yourself and your employees trained. Training isn't something that's done once; it's a constant practice of any well run organization. Check out the American Society for Training and Development (ASTD) the organization for people who train people. See astd.org. You can rent training videos on a huge array of subjects. Youtube is a wealth of useful training videos. But an experienced live trainer who regularly conducts classes in your organization is by far the best.
  • Read. Whether read trade journals to keep up with trends in your industry or reading a book to improve your management skills, you must devote part of your time to reading about business management.
  • Go to meetings and conventions. organizations that are geared to your industry are not only a great way to keep up with the latest trends but they are also a good way to make valuable contacts.
  • Meet regularly with other managers. There's nothing like kicking around ideas with business owners who face the same issues as you. Formally this is known as Peer Group Advisory groups or panels. The most well known are Vistage, formerly known as TEC, and The Alternative Board (TAB). The groups meet once a month and the meetings are all about business management and how your peers handle problems like yours. You have to pay to be part of such a group but the experience may be well worth it.

Small business management, done properly, will mean success; done poorly and it can be a train wreck.

The writer of this article, Russ Moran, is the author of The APT Principle: The Business Plan That You Carry in Your Head.

Copyright © 2014 by Russell F. Moran - All Rights Reserved

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    • rfmoran profile image
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      Russ Moran 5 years ago from Long Island, New York

      A business plan that isn't used may as well not exist.

    • rfmoran profile image
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      Russ Moran 5 years ago from Long Island, New York

      I feel your pain. I've had similar experiences. I long ago gave up trusting my instincts when interviewing.

    • leahlefler profile image

      Leah Lefler 5 years ago from Western New York

      This is great advice - hiring employees can be a tricky thing to do, and costly if a poor candidate is chosen for a position. I once hired a person who appeared to be intelligent and hardworking in the interview, but we found he could not perform simple addition once on the job. Since we worked in a fast-paced laboratory environment, this proved to be a great problem! We had to institute a basic math test after that snafu!

    • rfmoran profile image
      Author

      Russ Moran 5 years ago from Long Island, New York

      Thank you Simone. Glad you found it useful.

    • Simone Smith profile image

      Simone Haruko Smith 5 years ago from San Francisco

      Now THIS is a fun field!!! You've offered such a great advice in this overview. Even though I went to business school, many of these important principles didn't hit me until years after I graduated.

      Great point on how business plans should be considered more as dynamic guides. Great tips on hiring employees, too. Ugh, and networking... I really need to become better at that. I'll get there!

      Thanks for the important reminders and useful tips!

    • greatstuff profile image

      Mazlan 5 years ago from Malaysia

      I agree with you that most small business people have a business plan in place, but will not follow and implement them as they either don't have the time and patience, or find it too complicated. That is why some banks, will walk them through their initial phase of the business, if they provide them with a business loan. Voted up and useful.