activities that are related with running a company

 activities that are related with running a company

Introduction

The activities that are related with running a company, such as leading, controlling, organizing monitoring and planning is basically the meaning of business management. Coordination of all this activities is done in a business in order to achieve specific objectives (Welford, 2010). Other factors such as money, machines and materials are rolled out as necessity for production. Various people are involved in business management, a good example is the managers and directors who make vital decision and oversee an enterprise (Nelson, 2008). Quality and experience of this board of management is of importance because it through them that the company’s current and future worth is determined. Business is an entity that is involved in the provision of goods and services to the consumers. This entity can be a firm, agency or enterprise.  A company can be classified under the following: financial business; these are enterprises that generate profits through investment and management of capital like banks. Agricultural and mining business is the type of activity that produces raw materials such as minerals and plants. Manufacturers companies produce products from raw materials and sell their goods at profits (Marple, 2011).  Real estate business deals with renting, selling and developing properties such as residential homes and land. Transportation Company engages in products and special delivery to their destinations at a certain fee. Service business offers intangible goods and services to customers.  Information business is a type of activity that makes a profit through the selling of the intellectual property, for example, software and internet companies (Partington, 2006). There are several forms of business structures; these include sole proprietorship, general partnership, limited partnership, limited liability partnership, corporation, nonprofit corporation, limited liability companies, and trusts.

A Sole Proprietorship is a business owned by an individual. These business flexible, has fewer legal controls, fewer taxes and therefore easy to operate. The general partnership consists of two or more persons who agree to contribute labor, money and skills to business. Each partner shares the losses, profits, and management of the firm. Each partner is responsible for debts of the partnership. The limited partnership involves both general partners and limited partners. Corporations entail privileges, rights, and liabilities beyond those of an individual. The organization can be formed for profit or nonprofit purposes. Nonprofit Corporation is a legal entity and is operated to run further a goal rather than interests of profit. It serves the public interest. Other nonprofit corporations engage in private sector activities (Dosi, 20008). Limited Liability Company is formed by one or more individuals or entities through a special written agreement. The agreement provides distribution of profits and losses, provision of, management and assignability of interests. Trust is a legal relationship in which the trustee holds property for the benefit of the beneficiary. An Association is an organized group of people who share a common interest, purpose or activity.

A business organization contains both internal and external stakeholders. A corporate stakeholder is a group or an individual who can affect or be affected by the actions of the firm. Internal stakeholders are people who work directly within the business; these include business owners, employees, and investors. External stakeholders refer to groups outside a business or people who are not directly connected with the firm but are affected by the decisions of the enterprise, such as trade unions, suppliers, customers, community, creditors and the government. The government is concerned with tax payment and legalization. It also validates the financial reports produced each year by the business. Customers focus on getting high-quality products and services at fair prices. Creditors concentrate on being repaid entirely on time the community provides labor to the firm as employees (Zimmerer, 2002).  Business plays the following roles in the society. It provides employment to the community; it provides goods and services to customers, and it improves standards of living among its employees. Business enhances the economy of the country through exports and paying taxes. A business activity builds good relations among different countries. It creates unity among countries involved in trading activities.  Business impacts right skills among people and improves the economy of the country. The company provides profit to the firm financiers and owners. To operate a real business, a business plan is required.

A business plan is a written or drafted document showing the feasibility of a prospective new business. It provides a roadmap for the business operation. A program of activities is used for both a start-up company and also as any offshoot of any existing business. It acts as an action plan, sales tool, and road map. As a response tool, a business plan can help to indulge you in action. A business plan helps a business oriented person to pull apart the pieces of starting a business and examine each piece independently. It also helps in pulling together the resources required to launch a business and run the business smoothly (Marple, 2011). A business plan helps you to break down your insurmountable task of commencing a business into less intimidating tasks which are easy to implement.  As a roadmap, business plan acts as an invaluable tool to help keep you on track (subjective) and moving in the direction you want to go (objective). A business plan helps you to identify your customers, employees, customers, friends, family and also suppliers. A business plan serves as a sales tool (Partington, 2006). It is used to convince investors to finance your business. It is also used to convince vendors to give concessions. The business of a startup business includes the following. It proposes the new business endeavors and explains its purpose and its target market. It describes the market environment and industry the proposed business is supposed to operate. The business plan also outlines organizational and managerial sections and the role of the staff. It dictates the function of the firm, what the company will offer in the market. The sales and marketing section outlines the strategies of branding, marketing and selling your service or product.

Business plan plays critical roles in running and managing business smoothly. It plays an important part in the market analysis. A business person conducts research in the existing market to identify a business gap. He or she surveys the products and services supplied in the current market based on which the product or service the business person is willing to provide. Through this research, the business person identifies the lacking service or commodity in the market and decides what to offer according to the line of business (Dosi, 2008). The plan of activities facilitates this activity. A good business plan also helps competitor assessment.

A business person can know the current prices of the existing products on the market. Pricing strategies are based on the perceived value of goods and services, the cost incurred in doing the business, marketing goals and expected competitive actions. Pricing strategies involve use of both simple methods and sophisticated strategies which include carefully assessing and measuring the value delivered by the firm to the target market. A business plan also helps in measuring the cost incurred in the production process. This assists in providing a floor for the price. In the distribution portion, the owner of the business describes how the products and services of the company will be distributed and over which geographical area. Distribution decisions outline the channels of delivery that aims at optimizing the sales and profits (Zimmerer, 2002). Freshness, timeliness, customer service, access customer cost, and efficiency affect the choice of distribution. Business plan assists in financial planning. The financial plan is crucial in evaluating a new investment opportunity. It helps in developing an estimate of profit potential.     The financial plan describes the current economic status and present forecasts of future financial statements.  The amount of finance required in the business is covered up in the plan of activities. It also outlines the viable sources that are able and capable of funding the business.

The business plan also helps the investor to consider the legal issues. It provides the intellectual property protection law which protects business and its product from imitators. The law also provides company trademarks and service marks which protect company’s marketing symbols for goods and services. Every business is also subjected to local, state and federal regulation. Standard business plan errors which lead to poor management of the business include the following: incompetence market research; this is whereby competent information about the goods and services is not collected (Welford, 2010). When a person lacks objective in a business idea, then the business plan may lead to business failure. Making assumptions in business plan about the intended business may result in business failure.  A viable study should be conducted about the nature of the business and also about the products the company is willing to provide. Useless information in the business plan also affects the intended business. This information is always false and biased and lacks concrete evidence. Missing linkages in the business plan is inconsistency in planning. This is a method where the different stages described above are not interrelated, where the assumptions differ in different sections, therefore, lacking consistency, where marketing budget is not supported in the marketing plan. Where the marketing budget requires similarity in the number used the financial projections.

Human is an asset that is un-expendable since they portray error free performance, and it’s for this reason they are the ones that offer proper and vital managerial skills for an organization to succeed.  It’s not foreign that different managers in different companies use more than one theory for them to achieve productivity and various organizational goals (Marple, 2011). These theories are useful and important for everyone in a managerial position to learn understand and know the way to implement these theories. Mangers should be able to make decisions by the use of Contingency Theory whereby they decide a certain path based on the situation at hand rather than a programmed way of doing things. A decision made based on current aspect not only saves the company from getting a loss but also uplift trust and quality of the managerial team. Managers are also supposed to learn from Systems Theory whereby they realize how employees can affect the system and how the system may affect the employee. It’s through this theory that managers are able to examine events and patterns in their field of work, thus giving them a chance to coordinate programs and work as a team to achieve the company’s goals (Zimmerer, 2002).

Human relation management theory is also a very important tool in management. Each and every employee has a desire to be part and person of a supportive team that propels growth and development (Nelson, 2008). Managers should therefore have in mind that if employees are encouraged, motivated and get special attentions they are greatly encouraged to actively participate and perceive themselves as significant therefore increasing both the quality and quantity of production in their field of work. Taylor’s theory of scientific management also drew a great popularity to the business management sector (Zimmerer, 2002). Taylor broke sections of a workplace to small units in an effort to outline the most efficient and effective way to accomplish a particular task in consideration of time. Creation of a system based on equity for rewarding improved productivity. This increased employee incentive, created better personnel practices and uplifted quality control.

McGregory XY theory stands the odds of time as it is being practiced up to date by successful companies in USA and Germany such as Exxon Mobil and Adidas Apparel and Accessories respectively.  It’s through McGregory’s XY theory that we are able to learn that fulfilled and engaged workers actually enjoy their work, self-fulfillment is a vital reward that workers seek and under the right condition workers tirelessly take initiative, become responsible and make very creative decisions (Zimmerer, 2002). Finally business managers should also consider Max Weber’s bureaucratic management theory whereby he stressed on efficiency while on the other hand warned on the repercussions of insisting on technology on emotions’ expense. Max outlined key principles of an efficient bureaucratic system pointing out the challenges that may crop up. Weber clearly outlined job roles, hierarchy of authority and the importance of hiring employees who meet the qualification for a specific job. This theory is highly practiced by high earning companies in the United States of America and Germany; examples include WalMart Company and BMW Automotive Company respectively (Marple, 2011).

Business at a primary level a primary level entails production of raw materials, which entails mining fishing, farming, and logging among other processes. Managers under these sections should posses strong decision making skills since they have to maximize on production and have a plan strategy on how to tackle various difficulties in the field (Marple, 2011). Managers under this section require to be strong enough to handle crisis on defective process of production, a good example lies on a mining site in the United States of America known as Fairbanks Gold Rush that efficiently ran its activities through strong primary managerial skills.

Secondary business management plays as an important icon in business running errands and ensuring that ends meet without difficulty (Welford, 2010). Today managers under this level of manufacturing and processing of raw materials may be termed as middle-level managers who must devote more skills and time to organizational and directional functions. The managers are supposed to execute major organizational plans in line with objectives and policies (Nelson, 2008). Business managers at this level are supposed to offer guidance and inspire employees in order to uplift quality efficient performance and goods manufacturing. These techniques have been executed successfully in manufacturing companies such as the Volkswagen Company in Germany Service provision also known as tertiary level is a level whereby it assist both primary and secondary sector and supports them in production and distribution process. It includes transportation, advertising, insurance, warehousing and other services. Individual business managers under this level should be characterized by strong interpersonal skills in order for them to create a rapport with their clients (Zimmerer, 2002). They should effectively interact, have strong communication skills and possess persuasive skills. Managers under this sector should be able to understand how organizational units work and at the same time have mastery of the service they are offering a good example is New York Life Insurance company in the USA (Marple, 2011).

Chain of Management rotates around the processes that must be taken in order to get the right product, into the right customer in the correct quality and quantity, at the right time. In the chain of management the managerial board tries to obtain a competitive merit by producing and delivering product in a faster, cheaper and better way (Welford, 2010). Today’s global business environment demands innovative and creative faster solutions in order to cater for sophisticated consumers and competitive pressure. This clearly shows that for one to be a good manager he or she should posses most of the following qualities; they should be creative to separate competence from excellence, this will propel projects forward. They should possess intuition whereby they have the capacity of knowing without the use of rational processes, this makes him or her stronger. Versatility is also a very productive quality of a manager, he or she should be flexible, non reactive and possess openness (Zimmerer, 2002).

Employees in a company work and produce quality only if the management is running smoothly (Nelson, 2008). Some of the qualities of a great management system include, provision of necessary resources, rational decision making, knowledge empowered, appreciation of employees and delegation of task. All these qualities may only be brought up if both the management and the managers have stipulated roles, their roles include interpersonal roles; manager and the employees have a good relation (Welford, 2010). Informational role whereby the management collect, receive and disseminate information for efficient working. Rational decisional making which is done by the managers, failure of which may affect the whole company. An example is about the General Motors Company in the USA whereby the CEO made a bad decision that led to a recall of millions of cars and death of many people.

The management system rotates in a number of challenges that act as hindrance of prosperity to greater heights. Some of them include, technological factors several different companies fail to adapt modern technology or rather where the company is located lack access to crucial services. This cripples the company’s production and makes it to underperform whereas in the presence of these services the company could have done better (Zimmerer, 2002). Organizational factor is another issue that really affects management issues. Lack of cooperation and team work between members will definitely lead to low in quantity and quality in production. Poor management will definitely lead to negative impact on productivity; one of the reasons that negatively impact employee’s activities is poor management (Nelson, 2008). This would lead to low morale and complain each and every time from the employees, decreased profit due to reduced productivity, and in other cases business failure and closure this mainly caused by high employees turnover due to poor leadership. When a company has an excellent working management system employees will be empowered, disputes will be resolved, high production will be experienced and employees will be motivated to work more hard (Welford, 2010). A good example is the Black Berry company in the USA that is experiencing high profits due to sufficient management systems.