Business management is a business strategy designed to achieve better results. This is an important topic for organizations of all sizes and can significantly transform the way internal processes are carried out.
In a market that is constantly changing, promoting adaptable and flexible management, but at the same time safe and planned, is essential to maintain the sustainability of the business.
With this in mind, we have prepared this article, which explains the best way to apply effective business management and ensure results.
What Is Business Management?
Business management is a set of strategies and tools applied to the company, to improve the quality of operations and ensure sufferable development.
All areas of the company are included in this approach: from finance, legal, and marketing, to customer service. It is also necessary to take into account the infrastructure of the company and the established objectives.
A company is a complex ecosystem, in which each area affects the others. Therefore, having good leadership and a smart business plan completely changes the direction of the organization.
Strategic planning is in the DNA of business management. With these definitions, it is possible to understand which are the best indicators to evaluate the business, identify bottlenecks, and assess whether the company is on the right path.
Types Of Business Management
There are different types of business management. Each of them presents specific advantages and can be adapted to the structure of different companies.
There are management models that value the effort of employees, others, and innovation, while other companies manage with a focus on results.
Below, we list 9 types of business management, so that you can identify which one best suits your organization.
It is the traditional management model, but also the most contradictory and it is falling into disuse in most organizations.
It is a model that has the manager as the central figure. He makes all the decisions and hardly gives a voice to the teams, although he supports the employees to carry out the activities according to his guidelines.
On the other hand, democratic management makes decision-making based on the contributions and participation of employees.
There is more commitment from the teams, but the manager must be a leader with good communication skills, to avoid friction.
Management By Meritocracy
In this model, top-performing employees are the focus of management’s attention. This encourages employees to participate more actively in the company’s processes to be recognized and contribute directly to the results.
At the same time, if the manager does not know how to lead the teams, a climate of competition and tension can arise.
The value chain model was developed in 1985. The central idea is that the consumer needs to see products and services as the value to purchase them. Therefore, with management based on a well-applied value chain, the company could experience great growth.
The concept was created by Michael Porter, a reference in business management. In this format, all stages of the production chain are taken into account, always thinking that each process must add some value to the final product.
Business management based on the innovation cycle always guides planning in search of new procedures, technologies, and solutions – whether for internal activities or in the offer of products and services to the customer.
There is a strong appreciation of the new processes, with the work divided into stages of creation, implementation, and capitalization.
Excellence In Management
The MEG – Management Excellence Model – was developed by the National Quality Foundation (FNQ) and is a methodology for implementing good practices. It works based on eight fundamentals:
- Organizational Learning and Innovation
- Engagement with stakeholders
- Sustainable development
- Value creation
- transformational leadership
- Process orientation
- Systemic thinking
Results As A Goal
A results-oriented management always seeks to achieve or exceed previously defined objectives – without worrying too much about the stages to reach the final result.
Although it has the advantage of guaranteeing more freedom and individuality to each worker, management can become a hassle if the processes followed are not documented.
On the other hand, we have process-oriented management. Here, the essence is to standardize operations and ensure greater organization throughout the production chain.
But make no mistake, in this model, there is also great interest in results, since the constant search for process improvement is aimed at more interesting results and increased business efficiency.
What Is The Role Of The Business Manager?
The commercial director manages and coordinates the activities of the team. His role is to optimize internal processes and act as a facilitator, planning delivery schedules, setting targets, and being the communication medium between the teams.
While they don’t have to “get on the job,” they must understand what each worker does and their responsibilities in the overall production process.
In addition, you must have a strategic profile, and business vision, be a good conflict mediator, and have the ability to analyze the market and the competition.
What Is The Importance Of Business Management?
Business management is a broad concept, encompassing all areas of the business environment.
Although companies depend on a series of factors to be successful or not, good business management is fundamental to the success of an organization.
With technical knowledge, accurate market analysis, and creativity, it is possible to overcome negative scenarios and avoid closure, even during a crisis.
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How To Apply Business Management?
Good business management depends on some basic steps, such as planning, measuring results, and qualifying professionals. Below, you will find some tips on how to apply good management in your company.
First of all, you need to plan. In the business context, this means setting goals and defining the actions needed to achieve them.
Through the business plan, the company defines how it will act and its objectives as an organization, always making adjustments to improve performance and have better results with the client.
Each area must share the action plan with the employees, ensuring that everyone works in an aligned manner and is focused on a common goal.
To know if the company is moving in the right direction, it is necessary to measure the impact of the actions. This is done through performance indicators.
Called KPIs ( Key Performance Indicators ), they evaluate the processes, products, services, and general performance of a company concerning the established objectives.
Based on the data obtained from these indicators, management can make adjustments or follow the defined plan, always thinking about the growth of the business.
Another key factor for the company that seeks more effective business management is technology.
The new solutions on the market allow the automation of a series of tasks, connecting different areas of the company, to have more clarity in communication and more agile processes.
In this way, decision-making is based on real data and information shared by all areas of the business, which makes management much more intelligent.
Finally, it is worth mentioning the impact of professional qualifications on company results. And here we talk about both the managers and the employees that make up the team.
In addition to hiring professionals with the necessary skills for the company, whether they are developed in colleges, technical courses, or free courses, the company itself must invest in qualification, through training and workshops.
Investing in qualifications is a way of ensuring that professionals are always up to date with the best practices in the market and, at the same time, helping to retain talent.
Business Management Tools
Business management tools are techniques, approaches, and performance models aimed at improving processes, with an impact on the performance of all areas.
The use of these tools provides the manager with greater control over the actions and the business itself, with a global vision of it, from the planning phases to the execution of each action.
Below, you can see the main management tools currently used by companies.
The SWOT analysis is based on the Strengths, Weaknesses, Opportunities, and Threats quadrants. Although it was created more than 50 years ago, it is still strongly adopted. In this model, the company must present data on the four aspects :
- Strengths / strong points: what are the strengths of the company?
- Weaknesses / weak points: what are the disadvantages of the company concerning competitors or even its internal processes?
- Opportunities/opportunities: what points can provide new operating opportunities for the company?
- Threats/threats: what internal factors can negatively affect the company?
Business Model Canvas
The Business Model Canvas is a model based on a visualization map, consisting of nine blocks:
- key associations
- key activities
- key resources
- Value proposal
- Relationships with customers
- market segments
- cost structure and
- sources of income
In this model, the descriptions of the blocks serve to direct the actions, in addition to being a very visual way of understanding the business and the elements responsible for its success.
The BCG matrix is a graphical analysis tool, created in 1970 by Bruce Henderson. It defines and compares the different solutions and units of the company based on the intersection of two axes: market growth and relative market share.
This model helps define the positioning of products and services in the market, based on four decisions:
- Build a market share
- Keep current state
- Collect as much as possible before interrupting a solution
- Close a product, activity, or business
GUT stands for Gravity, Urgency, and Tendency. This tool is used to prioritize those issues that need to be resolved first. After all, several things happen at the same time in the company and it is not always easy to know where to start.
- Severity: evaluates the impact of a certain problem in the development of the activity.
- Urgency: it can be classified according to the need for a solution – it can wait, it is not very urgent, it deserves attention in a short period, it is very urgent, or it needs immediate attention.
- Trend: Assess whether the problem may worsen over time.
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Benefits Of Business Management
Organizations that care about applying good business management will have increasingly better results. This is because the management guarantees benefits such as :
- More assertiveness in decision making
- Safer processes
- Failure Mitigation
- The systemic vision of the market
- The best application of available resources
- 360º vision of the business
- More control over internal processes and integration between departments
- Cost reduction and increased profitability
- Possibility of long-term planning.
Business And Business Management: How Can Technology Help?
To improve the management of the company, it is essential to know the existing business management approaches in the market and, fundamentally, to have a good organization of the company’s processes.
BPM ( Business Process Management ), for example, is a management discipline that integrates strategies, technology, and business objectives to improve processes. BPMN, for its part, is the notation model that will show this strategy visually.
Lastly, the BPMS will map, automate, execute, and monitor these processes, transparently and with a high impact on the results.