Not everyone is a born leader, and not everyone takes to business management quickly. However, with the right approach, anyone can learn the necessary skills to move up in the corporate world and keep their team members working their best.
Whether you are managing a small business or a multi-national corporation, soft skills — things like communication, emotional intelligence, and problem-solving — remain generally the same.
With that in mind, it’s easy to understand how working on these core skills at the beginning of your career can result in better management practices later down the line. And since management and leadership go hand in hand, you’ll have people following you on your path to success.
Below, we’ll give you a business management definition, explain how it differs from business administration, and list the five crucial skills you need to succeed.
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What is business management?
Business management refers to the process of organizing, planning, directing, and controlling resources within an organization.
It includes setting objectives and strategies, as well as implementing policies and programs that help achieve those goals. The goal of business management is to make sure a company runs smoothly and efficiently while also achieving its long-term objectives.
There are a variety of ways this can be done, but it generally falls to the manager to find the systems and processes that work best for their team. This means being able to adapt to change, as well as being proactive and always looking for ways to improve.
Let’s take a look at some of the different subtopics that this category can include.
Small business management
Small business management is, as the name suggests, the process of managing a small business.
This can include anything from hiring and firing staff to handling day-to-day operations and overseeing long-term strategy. The goal of small business management is to ensure that your company is running as efficiently and effectively as possible.
There are a few key things to keep in mind when it comes to managing a small business.
- You need to wear many hats: You’ll likely be responsible for a lot of different tasks, from accounting to marketing to customer service. Be prepared to juggle a lot of different balls!
- You need to be a jack-of-all-trades: In addition to wearing many hats, you’ll also need to have a broad range of knowledge. It’s unlikely that you’ll be an expert in everything, but it’s important to have at least a basic understanding of all aspects of your business.
- You need to be flexible: Things will change, and you need to be able to adapt. Whether it’s a new law that affects your business or a change in customer behavior, being able to adjust on the fly is crucial.
- You need to be organized: This is especially important if you’re taking on a lot of responsibility. You’ll need to keep track of many different things, so staying organized will be key.
- You need to delegate: As your business grows, you’ll need to start delegating tasks to other people. This can be difficult, but it’s important to trust others and allow them to show what they can do.
Suddenly, if you can accomplish these things, business management doesn’t seem so daunting, does it? These are just a few of the skills you’ll need to succeed in this field.
Of course, there are many more, but we’ll get to that later. For now, let’s move on to another important topic.
Business risk management
Risk management is the process of identifying, assessing, and controlling risks that could potentially affect a business. This can include things like financial risks, operational risks, reputational risks, and compliance risks.
It is a critical part of business management because it helps businesses avoid potential problems that could hurt their bottom line. By identifying and addressing risks early on, businesses can save themselves a lot of time and money in the long run.
For example, say a company is planning to launch a new product.
The risk management team would identify all of the potential risks that could come with launching a new product, such as:
- Financial risks. The cost of development, marketing, etc.
- Operational risks. The product not meeting customer expectations or manufacturing issues.
- Reputational risks. Negative media coverage, or customer complaints.
Once these risks have been identified, the risk management team can develop strategies to mitigate them. This might involve things like setting aside a budget for contingencies, developing a detailed launch plan, or creating a customer service plan in case there are any issues with the product.
Business management vs business administration
There are a few differences between business management and business administration, but the most notable one is that business administration tends to be more focused on the overall operations of a company, while business management is more focused on leading and motivating employees.
Another difference is that business administration is often seen as a more traditional career path, while business management is often seen as a more modern approach. Business managers are often responsible for developing new strategies and initiatives, whereas business administrators are responsible for implementing them.
Ultimately, both business management and business administration are important for the success of a company. It’s just a matter of finding the right balance for your team.
Top 5 business management skills you need to succeed
The ability to manage a business successfully requires a specific set of skills. While some people are naturally more inclined towards these skills than others, they can all be learned and developed over time.
Here are the top 5 business management skills you need to succeed:
- Emotional intelligence
- Organizational ability
Easy enough isn’t it? Let’s dig a little deeper into each one, to make sure you understand.
Effective communication is essential for any manager. You need to be able to communicate your vision and objectives to your team, as well as give clear instructions and feedback.
You also need to be a good listener. This involves being able to understand what others are saying, as well as taking the time to listen instead of just waiting for your turn to speak. Good communication also requires being able to adapt your message depending on who you’re speaking to.
For example, you would communicate differently with your direct reports than you would with a client or customer. The ability to adjust your communication style depending on the situation is known as situational awareness.
Emotional intelligence (EI) is the ability to be aware of and understand your own emotions and the emotions of others. It’s about being able to regulate your emotions, respond effectively to emotions in others, and create positive relationships.
Managers with high emotional intelligence can create a positive work environment, resolve conflicts effectively, and motivate their team members. They know how to read people and adjust their communication and leadership styles accordingly.
As a manager, you will be facing challenges daily. Some of these challenges will be small, such as dealing with a customer complaint or resolving a minor conflict between team members. Others will be more significant, such as dealing with a drop in sales or a major change in the market.
Whatever the challenge, it’s important that you can identify the problem, gather information, and come up with potential solutions. You also need to be able to evaluate these solutions and choose the best one. This process is known as problem-solving.
Making decisions is another essential skill for managers. You need to be able to weigh up pros and cons, consider different options, and make decisions that are in the best interest of your company.
This can sometimes be a difficult skill to master, as it requires being able to think both logically and strategically. However, it’s important to remember that there is usually not one “right” decision. Rather, the best decision is often the one that achieves the desired outcome while also minimizing risks.
Organizational ability is the capacity to plan, implement, and monitor systems and procedures. It involves being able to set goals and objectives, as well as develop plans to achieve them.
It also requires being able to delegate tasks, monitor progress, and make changes when necessary. This skill is important for managers because it helps to ensure that work is getting done efficiently and effectively.
Developing these business management skills will not only help you in your career, but will also benefit your company. By becoming a better manager, you can create a more positive work environment, resolve conflicts effectively, and motivate your team members.
These are all things that will lead to a more productive and successful business.
Mistakes to avoid in business management
There are a few common mistakes that managers often make, which can lead to problems down the line. Let’s take a look at some of the most common ones:
- Not delegating: One of the most important parts of being a manager is knowing when to delegate tasks. Trying to do everything yourself not only sets a bad example for your team but can also lead to burnout.
- Micromanaging: On the other hand, you don’t want to delegate and then micromanage. This will just frustrate your team and make them feel like they can’t do anything right. Trust your team members to do their jobs and only step in if there is a problem.
- Not communicating: Communication is key in any relationship, and that includes the relationship between managers and their teams. Make sure you are clear about expectations, deadlines, etc. so that everyone is on the same page.
- Not setting goals: Goals give your team something to work towards and help you measure success. Without goals, it’s difficult to know if you are making progress or not.
- Not giving feedback: Feedback is essential for helping team members improve. Make sure you are giving both positive and constructive feedback regularly.
If you can avoid these mistakes and master these five skills — which may take you years — you will be on your way to becoming a successful business manager, able to lead any team to success.