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What is Business Management: 5 Ways it Can Boost Growth

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“Management is a multi-purpose organ that manages the business and manages managers and manages workers and work.” This is how Peter F. Drucker, the father of modern management, explains the meaning of management in his book, The Practice of Management. According to Drucker, every business, regardless of industry or size, is established and run on certain assumptions. These assumptions are what Drucker calls “theories of business”. In brief, these theories and excellent management skills ensure effective business management. Let’s understand in detail what is business management, its benefits, and how to inculcate it.

What is Business Management?

The process of managing the overall functions of a business is called business management. These functions include planning, organizing, and directing a company’s resources to improve efficiency and achieve business goals. Business management is an umbrella term that encompasses the management of various business departments and activities. This includes finance, human resources, sales and marketing, and administration.In addition to this, effective business management also requires adapting to changing business trends and industry requirements. It furthermore includes fostering strong relationships with customers and service providers and promoting a positive workplace culture. To sum up, business management is about understanding and managing business activities to improve business growth and revenue.

ALSO READ: How to Chart a Successful Career in Business Management

What are the Benefits of Proper Business Management?

Now that you’ve understood what is business management, let’s learn how effective business management strategies can boost company growth:

1. Improves financial performance: Effective management enables you to plan and implement financial policies for controlling costs, boosting revenue, and increasing profitability

2. Increased productivity: In effective business management, all business processes are streamlined and made transparent; this creates a positive work environment and boosts overall productivity

3. Enhanced customer satisfaction:  An integral part of business management is framing and implementing policies and processes to increase customer satisfaction and improve the customer retention rate

4. Increased employee engagement: As business management also focuses on improving workplace communication and promoting a collaborative environment, it helps companies retain talent

5. Better risk management: Effective business management enables the implementation of processes to identify and mitigate potential risks

What are the Essential Elements of Effective Business Management?

The next step in learning what is business management requires understanding its essential elements and the role they play. These include:

• Planning: It is the process of establishing business goals, developing strategies, and creating actionable steps to achieve objectives in a competitive market

• Organization: A significant part of the business management process is organizing defined roles and responsibilities, and processes and structures in an organization

• Control: For effective business management, constantly monitor and evaluate business processes and control it to ensure the effective consumption of all resources

• Operations: Another key element of modem business management is technological operations; it helps streamline various business processes and improve productivity

How Can Aspiring Leaders Develop Business Management Skills?

Understanding what is business management is a lot easier than ensuring its practical implementation. Moreover, learn business management skills such as leadership and decision-making. Here are a few tips for developing an overall business management skill set.

Focus on Decision-Making

Strategic decision-making is the essence of effective business management. Make sound decisions by weighing the significant risks and advantages of every decision. In fact, to learn decision-making skills, identify business goals, do market research to find better alternatives, analyze data, and consider the consequences to make informed decisions.

Self-Awareness

Self-awareness involves assessing one’s strengths and weaknesses as a leader and identifying areas of improvement. It also helps improve relationships with employees and clients, boost focus and productivity, and lead to conscious decision-making. All of this ultimately contributes to effective business management.Self-awareness also involves reflection on thoughts by evaluating past experiences and finding areas of improvement for better decision-making.

Pursue Management Training

Pursuing management training or business management courses is one of the best ways to learn the practical aspect of what is business management. Business management courses enable one to work on numerous practical projects and engage with industry leaders.

Seek Mentorship

Business management is a challenging concept; it requires certain qualities and skills. One of the best ways to learn business management skills is to seek mentorship from business leaders. Learn from their previous instances and the knowledge that they impart.

Consume Content Related to Business Management

Another best way to learn business management skills is to study various strategies, skills, techniques and approaches to business management. Also, read books, podcasts, research papers, articles, and interviews of leaders to understand various business management theories and how they can be implemented.

Gain Practical Experiences

Theoretical learning can help one gain industry insights and learn the latest trends. Evidently, gaining practical experience is the best way to learn what is business management. Also, take up business management internships or jobs in startups for practical experience.

ALSO READ: Mastering Company Management: 8 Skills Needed to Succeed in This Career

What is the Role of Communication in Business Management?

Any discussion on what is business management is complete with specifying the importance of communication. In business management, communication refers to creating, conveying, and interpreting facts related to organizational efficiency, work performance, and goals. Effective communication between team members, managers, employees, and all other stakeholders is the key to organizational growth and improved management. Furthermore, communication is also essential for the exchange of ideas between team members. It improves transparency and keeps employees motivated as they know all strategies and actions. Eventually, communication in business management promotes a positive workplace culture. Effective communication enables employees to understand their individual and collective roles and responsibilities. As a result, it helps achieve business objectives and boosts organizational growth. Moreover, communication is critical for smooth organizational change management processes. It helps employees understand new roles, policies, or functions. To sum it up, efficient business management is only complete with effective communication within the organization.

How Has Business Management Evolved Over Time?

Multiple business management theories have emerged since the 1940s: downsizing, re-engineering, total quality management, and outsourcing. Business managers have used these theories for decades to bring organizational changes. However, while managers have found ways to do so, they often need help with what changes to make. Simply put, even if they know the process of making change, they need to be made aware of what changes must be made for organizational growth.Current trends in business management involve ensuring work flexibility for employees and automating tedious and manual business processes to improve overall efficiency. Businesses are leveraging the latest technologies like artificial intelligence, machine learning, and the metaverse to improve internal processes and increase customer engagement.In conclusion, irrespective of the career path, business management is a core skill that will help one advance in their career. However, as the business environment changes and consumer demands evolve, business management trends and skills will likely change. Emeritus’ business management courses can help professionals learn the nuances of what is business management and how to leverage the same to ensure career growth.

By Sneha Chugh
Write to us at content@emeritus.org