Tag: BUSINESS MANAGEMENT BASICS

 

MORE A FOREWORD: AS USUAL WITH MY COURSES, THIS ONE ALSO DOES NOT GO DEEP INTO THEORY OF BUSINESS MANAGEMENT, ALTHOUGH THEORY PRINCIPALLY PLAYS AN IMPORTANT PART OF BUSINESS MANAGEMENT. THIS COURSE SHOULD GIVE NEW WOULD-BE ENTREPRENEURS SOME HINTS WHAT TO DO IN MANAGING THEIR BUSINESS, AND WHAT THEY JAVE TO EXPECT.

BEFORE WE START GETTING INTO DETAILS, WE NEED TO KNOW WHAT BUSINESS MANAGEMENT IS.

MANAGEMENT OR MANAGING IS

the process of coordinating and overseeing the activities of an organization to achieve its goals

(COURTESY OF BING)

WHERE BUSINESS IS ANY ECONOMIC ACTIVITY.

WE SEE THAT BUSINESS MANAGEMENT IS NOT A ONE-TIME APPEARANCE, BUT A PROCESS THAT LASTS AS LONG AS THE ECONOMIC ACTIVITY EXISTS.

THE PROCESS “BUSINESS MANAGEMENT” IS IN ITSELF DIVIDED INTO FIVE COMPONENTS WHICH THEMSELVES ARE PROCESSES. THESE COMPONENTS ARE:

— PLANNING,

— ORGANISING,

— STAFFING,

— LEADING, AND

— CONTROLLING.

THESE FIVE COMPONENTS DO NOT EXIST SEPARATED FROM EACH OTHER, BUT THEY ARE USUALLY OVERLAPPING. THAT MEANS THAT ONE OF THE COMPONENTS COMES INTO ACTION WHILE OTHERS ARE ALREADY ACTIVE. FOR EXAMPLE, YOU MIGHT BE PLANNING A NEW PART OF YOUR BUSINESS WHILE YOU ARE CONTROLLING THE EXISTING ONES. OR YOU MIGHT BE STAFFING A NEW PART OF YOUR BUSINESS WHILE YOU ARE LEADING THE EXISTING STAFF OF YOUR BUSINESS.

TO BE A SUCCESSFUL MANAGER, YOU MUST FOLLOW THESE FIVE COMPONENTS OF BUSINESS MANAGEMENT IN THEORY AND PRACTICE. IN THE NEXT LESSONS, WE WILL LOOK AT EACH COMPONENT MORE THOROUGHLY.

 

 

AND NOW TO THE QUESTIONS:

• DEFINE IN YOUR OWN WORDS WHAT MANAGEMENT IS.
• WHAT CAN BE MANAGED?
• HOW CAN BUSINESS BE DEFINED?
• WHAT ARE THE FIVE COMPONENTS OF BUSINESS MANAGEMENT?
• GIVE TWO EXAMPLES HOW YWO COMPONENTS OF BUSINESS MANAGEMENT CAN OVERLAP.

THE NEXT LESSON WILL BE PUBLISHED BEGINNING OF NEXT WEEK.

 

ACCOUNTING PLAYS AN IMPORTANT ROLE IN ORGANISING YOUR BUSINESS. WITHOUT A PROPER ACCOUNTING, YOUR BUSINESS MIGHT COLLAPSE WITHIN THE FIRST YEAR OF EXISTENCE.

WELL, I KNOW THAT MOST PEOPLE BECOME AFRAID WHEN THEY HEAR THE WORD “ACCOUNTING”. THEY ASSOCIATE THE ITEM WITH DOUBLE-ENTRY ACCOUNTING, CALCULATING DEPRECIATION, AND OTHER HORROR IMAGINATIONS.

BUT FOR YOU AS OWNER OF A MICRO OR SMALL BUSINESS, THAT DOES NOT NEED TO BE THE CASE, AT LEAST NOT FOR THE BEGINNING. WHEN YOUR BUSINESS GROWS, YOU MIGHT NEED TO OCCUPY YOURSELF WITH ISSUES LIKE SPROGRAMMES ON THE INTERNET. OR YOU CAN USE SOME GUIDES OF HOW TO USE MICROSOFT EXCEL FOR ACCOUNTING PRACTCES.

BUT LET US GET BACK TO THE START OF OUR ACCOUNTING. FOR THE BEGINNING, IT IS SURELY ENOUGH TO USE A SIMPLE INCOME/EXPENSES METHOD TO SEE AT THE END OF THE MONTH WHETHER YOUR BUSINESS MADE A PROFIT AT THE END OF THE MONTH, OR A LOSS.

YOU MAKE A LIST WHICH UOU SEPARATE INTO THREE PARTS UP DOWN. ONE SMALLER PART ON THE LEFT IS RESERVED FOR THE DATE, THE NEXT PART WILL SHOW THE INCOME (KEEP IN MIND THAT YOUT INITIAL WORKING CAPITAL IS YOUR FIRST INCOME). THE INCOME MUST CONTAIN THE AMOUNT YOU RECEIVED, AND FOR WHAT YOU RECEIVED IT THE LAST COLUMN IS FOR THE EXPENSES AND MUST CONTAIN THE AMOUNT OF EXPENSES AND FOR WHAT. FOLLOWING IS A SAMPLE:

 

DATE	INCOME (IN GHC)	EXPENSES ( GHC)I
1ST JANUARY 2025	10,000 INITIAL WORKING CAPITAL	2,500 RENT
2ND JANUARY 2025		5,000 PURCHASE OF GOODS FOR SHOP (SPECIFY)
3RD JANUARY 2025	1,575 SALES OF GOODS ON THAT DAY (SPECIFY; GHC 500 PROFIT)
	AND SO ON	AND SO OM
TOTAL JANUARY 2025	TOTAL INCOME AT THE END OF JANUARY	TOTAL EXPENSES AT THE END OF JANUARY
TOTAL JANUARY	INCOME MINUS EXPENSES

 

GOOD AND EXACT PLANNING IS ESSENTIAL FOR EVERY SUCCESSFUL BUSINESS. WITHOUT THOROUGH PLANNING, YOUR BUSINESS IS SURELY ABOUT TO FAIL. BUT LET US FIRST OF ALL LOOK HOW BUSINESS PLANNING IS DEFINED:

Planning is the primary function of management that involves formulating a future course of action for accomplishing a specific purpose. Planning enables managers to decide what task to do, how to do the task, when to do the task and by whom the task has to be done.

AND TO ACHIEVE A PLSNNING WHICH BENEFITS YOUR BUSINESS, YOU WILL NEED A BUSINESS PLAN.

A business plan is a roadmap for your business. It outlines your goals, strategies, and how you plan to achieve them. It’s a living document that you can update as your business grows and changes.

(COURTESY wisebusinessplans.com)

BUT NOBODY EXPECTS YOU TO WRITE A BUSINESS PLAN JUST LIKE THAT. YOU WILL NEED GUIDANCE HOW TO WRITE SUCH A BUSINESS PLAN. AND THERE ARE LOTS OF TEMPLATES TO BE FOUND ON THE INTERNET. IN MY OPINION, ONE OF THE BEST TEMPLATES IS THE PRINCE’S TRUST BUSINESS PLAN PACK. YOU CAN DOWNLOAD IT HERE:

BUSINESS_PLAN_2015.pdf (ctfassets.net)

WHEN YOU WRITE SUCH A BUSINESS PLAN – NO MATTER WHERE YOU TAKE THE TEMPLATE FROM – YOU MUST BE AWARE THAT SUCH A BUSINESS PLAN IS NOT A ONE-TIME EVENT. AS MUCH AS YOUR BUSINESS EVOLVES OVER TIME, THE BUSINESS PLAN HAS TO DO THE SAME. THAT MEANS THAT YOU HAVE TO REVIEW YOUR BUSINESS PLAN REGULARLY TO SEE WHETHER IT STILL REFLECTS REALITY, OR WHETHER YOU REALISED CHANGES FOR YOUR BUSINESS THAT NEED A CHANGE IN YOUR BUSINESS PLAN.

YOU SEE THAT THE BUSINESS PLAN’S PURPOSE IS NOT ONLY FOR EXTERNAL USE – THAT MEANS IF YOU WANT TO APPLY FOR A LOAN, OR YOU ARE LOOKNG FOR AN INVESTOR – BUT IT IS ALSO IMPORTANT FOR YOU PERSONALLY.

JUST LIKE THE BUSINESS PLAN MUST BE REVISED REGULARLY, YOUR OWN BUSINESS MUST BE REVIEWED THE SAME. KEEP IN MIND THAT THE BUSINESS IS NOT A STATIC EVENT, BUT YOUR BUSINESS HAS SOMETHING LIKE A “LIFE”. IT CAN ONLY EXIST IF IT IS FED REGULARLY WITH NEW DATA, CONFRONTED WITH NEW SITUATIONS THAT NEEDS SOLUTIONS.THEREFORE, IF YOU WANT TO START A BUSINESS, YOU MUST BE READY TO COMMIT YOURSELF COMPLETELY TO START AND ESPECIALLY DEVELOP THE BUSINESS.

LASTLY, IT MUST BE SAID THAT PLANNING CAN NOT BE SEEN ISOLATED FROM OTHER COMPONENTS OF BUSINESS MANAGEMENT. ESPECIALLY CONTROLLING – AS WE WILL SEE IN ONE OF THE NEXT LESSONS – FORMS AN INSEPARABLE ALLIANCE WITH PLANNING.?

 

 

AND NOW TO THE QUESTIONS:

• IN YOUR OWN WORDS: WHAT IS PLANNING A BUSINESS?
• WHY IS PLANNING A BUSINESS A PROCESS?
• WHAT FUNCTIONS DOES A BUSINESS PLAN HAVE?
• WHAT COULD PREVENT YOU FRON COMMITTING YOURSELF COMPLETELY TO YOUR BUSINESS? (EXAMINE YOURSELF)
• GIVE AN EXAMPLE HOW PLANNING AND CONTROLLING OVERLAP.

 

COMPARED WITH THE OTHER FOUR COMPONENTS OF BUSINESS MANAGEMENT, STAFFING MIGHT NOT BE EASIER TO ACCOMPLISH, BUT IT IS AT LEAST EASIER TO UNDERSTAND. HERE IS FIRST OF ALL THE DEFINITION:

An effective staffing process helps you find and retain strong candidates who are a good fit for your organization. More specifically, you can keep refining your staffing. Successful programs establish a continuous system of evaluating and developing your relationship with employees and selecting for qualities that are most effective. Ideally, the process of staffing can help you find great employees and maintain strong relationships with them.

DEFINITION IS COURTESY OF INDEED

OF COURSE, THE BASIC ASSUMPTION FOR EFFECTIVE STAFFING IS THAT YOU WILL NOT RUN YOUR BUSINESS ALONE, BUT THAT YOU TAKE ONE OR MORE EMPLOYEES.

THE FIRST STEP TO FIND THE SUITABLE EMPLOYEE FOR YOUR BUSINESS IS TO INTER VIEW CANDIDATES. YOU MIGHT FIND THESE CANDIDATES AMONG YOUR FRIENDS AND ACQUAINTANCIES, OR YOU MIGHT PUT AN ADVERTISEMENT IN LOCAL AND/ OR SOCIAL MEDIA.

WHEN ONE OR MORE CANDIDATES HAVE CONTACTED YOU FOR THE JOB, WE WILL GET TO THE INTERVIEWS. BUT BEFORE YOU START THE INTERVIEWS, IT IS ADVISABLE TO DEVELOP A SO-CALLED “QUESTIONNAIRE”. A QUESTIONNAIRE IS A LIST OF QUESTIONS WHICH YOU CONSIDER IMPORTANT TO FIND THE RIGHT EMPLOYEEYOU’RE YOUR BUSINESS. BASIC QUESTIONS SHOULD BE THOSE FOR AGE AND EDUCATION LEVEL. FOR SOME JOBS, IT MIGHT ALSO BE NECESSARY TO KNOW WHETHER THE CANDIDATE – NO MATTER WHETHER FEMALE OR MALE – IS MARRIED AND HAS CHILDREN, OR – ANOTHER ADRA OF IMPORTANCE – HOW THE CANDIDATE’S KNOWLEDGE OF THE ENGLISH LANGUAGE IS. OTHER QUESTIONS MOSTLY DEPEND ON THE KIND OF JOB YOU WANT TO HAVE AN EMPLOYEE FOR.

BUT MOST IMPORTANTLY – AS YOU CAN ALSO SEE FROM THE DEFINITION – YOU MUST BE ABLE TO ESTABLISH A POSITIVE RELATIONSHIP WITH YOUR FUTURE EMPLOYEE. BE CAREFUL: DON”T MISUNDERSTAND A POSITIVE RELATIONSHIP AS LEADING TO AN INTIMATE RELATIONSHIP WITH YOUR FUTURE EMPLOYEE! AN INTIMATE RELATIONSHIP COULD LEAD TO AN INCORRECT JUDGMENT OF THE EMPLOYEE’S HANDLING OF YOUR BUSINESS.

SO, WHAT IS A POSITIVE RELATIONSHIP THEN? THERE ARE FOUR PARTS THAT CONSTITUTE A POSITIVE RELATIONDHIP. THESE ARE:

— MUTUAL RESPECT,

— TRUST,

— COOPERATION, AND

— UNDERSTANDING.

IN PRINCIPLE, THESE FOUR SHOULD CONSTITUTE THE BASIC OF EVERY RELATIONSHIPL UNFORTUNATELY, THEY DO NOT. MOREOVER, THEY ARE EXTREMELY IMPORTANT IN AN EMPLOYER-EMPLOYEE RELATIONSHIP,THE EMPLOYER MUST SHOW RESPECT TO HIS EMPLOYEE (AND VICE VERSA), AND ONLY WITH A TRUSTFUL COOPERATION BETWEEN THE TWO THE BISINESS WILL BE SUCCESSFUL FOE THE MUTUAL BENEFIT OF THE TWO.

AND NOW TO THE QUESTIONS:

• WHEN – ACCORDING TO THE DEFINITION – WILL A STAFFING PROCESS BE EFFECTIVE?
• IN WHAT WAYS CAN YOU LOOK FOR CANDIDATES FOR A JOB IN YOUR BUSINESS?
• WHAT SHOULD YOU PREPARE BEFORE THE INTERVIEWS WITH THE CANDIDATES?
• WHAT ARE THE BASIC QUESTIONS IN EVERY JOB INTERVIEW?
• WHAT ARE THE FOUR COMPONENTS OF A POSITIVE RELATIONSHIP BETWEEN EMPLOYER AND EMPLOYEE?

THE NEXT LESSON WILL FOLLOW SOON – WATCH OUT!