As a manager or owner of a business, you will be aware of just how tough it can be to work towards making the right decision. Here are some tips you should utilise within your business practices in order to get on the right track.
Create A Plan And Adapt
It’s important that you have a plan of action to work with. This could be a daily POA for employees on what they need to work on, maximising efficiency, or it could be a monthly or annual plan for everyone to understand the agenda. It’s important to be flexible, as plans are never 100% accurate in what they achieve.
Understand The Industry And Market
In order to make the right decisions within your team and organisation, you need to understand the market and industry you’re working in. If you don’t have a grasp on competitors and consumer demands, then you will not be in a position to make the right decisions. Consider doing some market research with customers or market leaders to find out what you need to do.
Manage Your Team Effectively
One of the most important elements of managing a business is by effectively managing your employees. There’s plenty to consider when it comes to managing your team, such as keeping up high levels of communication. That means, keep them in the loop regarding any projects or deadlines, and inform them of what’s going on.
It’s also important to listen to any feedback that your employees may give you. For example, they may have issues with the way tasks are delegated. Rather than dismissing these objections, you need to resolve them, as that keeps the team happy and increases productivity.
You should acknowledge good work from your team, as it’s not only their feedback you should be seeking. Employees who only hear from you when it’s regarding a negative situation will only associate you with negativity. Positive feedback will help to build employee confidence, encouraging them to get more involved and improving employee retention.
Employee retention is important for a business as it leads to loyalty within a business, and also saves on hiring costs further down the line. Employees who leave, will leave a hole that needs filling. This empty hole will mean a lack of productivity, as no one is working it.
Importance Of Strategic Decision Making
The business landscape is constantly changing and innovating, making it more important than ever to make the right decisions when it comes to your business. You as an owner or a manager need to be capable of critical thinking, and have vital skills required to meet the expected modern standards and go beyond.
You may be able to pick up these skills from experience, but sometimes that can be risky, as you could make the wrong decision at a crucial time. For example, take Netflix and Blockbuster. When the business landscape started shifting towards more digital means away from DVDs, one business decided to go online and create a streaming platform, and one decided to stick to physical copies of DVDs. Of course, only one of those is around now, and important decisions were involved.
You should take a structured approach to decision making, in order to help you become better with judgements, and assist in justifying any decisions you make. You can study for a decision making bias course over a period of a few weeks, that aims to help those who enrol learn more about making quality decisions from a technical or non-technical standpoint. Almost everyone at any level of a business could benefit.
Be Innovative At The Right Time
When managing your business, you will have to often think about how you are going to innovate and improve the operation. Oftentimes, it could be you making leaps within your industry, or it could be you analysing how a competitor is doing with their innovations. Either way, you need to be sure about what your plan is at the time, so that your team understands the direction you’re heading, and that you don’t fall behind.
Being innovative could refer to launching new products that consumers have been demanding, or taking a risk with one they haven’t. Usually, it refers to businesses improving their own inner workings with employees, such as HR automation or better pieces of technology that they can utilise.
Whatever the reason, you need to get the timing right, businesses which utilise innovations at the right time have more chances of success. Poor timing for innovation could leak to backlash or damage to your brand, if poorly handled.
Digitalise Your Business
In order to help your business be successful and make the right decisions, you should consider digitalising aspects of your business where possible. For example, there are many virtual assistance pieces of technology that are used throughout businesses who require mass customer service, such as chat bots.
Digitalisation will speed up the way in which your business operates. You should speak to your team to find the best way to apply technology to everyone’s department. You may find that the accountant team needs some form of financial software that will half their workload, freeing them up for further responsibilities, which could lead to your business growing.
You should only invest into digital outlets if it’s affordable and practical. Consider purchasing older models of software or technology that are vastly cheaper in order to get a feel for if it will work for your business.
When it comes to considering reinvesting the money you are making for your business, it’s important to know the difference between gross revenue and net profit. Gross revenue refers to how much money is coming in as a result of sold products or services, essentially your blanket income. Net profit refers to how much money you actually made when you take off the expenditure and costs it took before the sale.
If you have high amounts of profits coming in, then you should seriously consider reinvesting them into the company. That means you can help your business expand, which aims to increase your cash flow even further. It can be used to give you a competitive advantage, it’s all about weighing risk versus reward.
Analyse Your Data Regularly
Analysing data and information related to your business is an effective way in which you can find ways to make the right decision. You will be able to find where time is wasted, and areas of business that are ineffective and costly. You should be collecting data at all times, either through a third-party analyser or an in-house department.
Data refers to assessing how your business is operating through numbers, in a precise way. This helps to eliminate any human error, as it is usually computers that collect the information.
Have Clear Set Future Goals
If you’ve set yourself annual plans, then you will be able to have something to work towards. This can be just for you, or your employees to give them something to aim for. It’s a motivational tool that allows everyone to be in the same boat.
Of course, sometimes these goals may end up being unrealistic or outdated, meaning you need to adjust them. Adjust them to a level that you believe is realistic, so that they are achievable.