Effective business management means managers improve their own efficiency while building a team of productive employees who can achieve company goals. All businesses in the digital age work best with autonomous employees and self-managing teams, who are confident and encouraged to make their own decisions. This blog will explore key elements to effective business management that you can implement today.
Ensure your employees feel valued
The most effective managers understand that leadership is about people. An essential element of strong leadership is ensuring your employees feel they are valued. When your employees feel valued they develop a sense of pride, loyalty, and personal ownership in the success of your business. This means they are far more likely to stay and grow along with your company. Your employees don’t need expensive rewards to feel valued. Rather, building a rapport with your employees is the better investment.
- Make time for your employees: Setting aside time for an employee shows that their needs and concerns are important to you. In addition to addressing their concerns, one-on-one time presents an opportunity for mentorship and constructive feedback. So, when an employee asks to talk with you, make sure you make the time to do so.
- Two-Way communication: Many managers view communication as a one-way encounter, a means to keep employees up-to-speed on functional information. However, successful managers understand that effective communication involves listening and an exchange of feedback. These managers encourage their employees to share their ideas and opinions because they understand that when there is active participation in discussions, great ideas can emerge.
- Recognize hard work: People want to excel. And when employees do a good job, offering positive feedback is the most effective form of reinforcement. In other words, what we water grows. When an employee is working hard or excels in some way, reward them by recognizing their work with a few words of affirmation. This will go a long way toward ensuring your employees feels they are a valuable member of the team. And when you offer recognition in front of your team, it shows that their hard work will be recognized, too.
Effective managers develop efficient practices to save time and increase productivity. A critical element to working smarter is to improve time management skills. This can be tricky for managers who are often pulled in many different directions. When this happens, some tasks may fall by the wayside. To avoid this, time management experts suggest the following tips to get a handle on your schedule.
- Change the way you approach your To-Do list: One expert says the most effective way to increase productivity is to limit the number of items on your To-Do list. He suggests choosing the three 'Most Important Tasks', or MITs, that must get done, and doing them first thing in the morning. Once your high-priority tasks are complete, you can move on to less critical tasks.
- Focus only on today: To reduce anxiety over your massive To-Do list, create a master list of everything that needs to get done. At the end of your workday, transfer your top three MITs to your list for the next day. This way you are able to focus on your top-priorities without the distraction of the myriad tasks on your master list.
- Learn to say ‘no’: Managers are often spread too thin because they feel a need to maintain control, and so take on tasks that distract them from their high-priority objectives. Warren Buffet suggests putting all low-priority tasks on an “avoid at all costs” list. In other words, learn to say ‘no’ to low-priority tasks or delegate them.
- Delegation: Delegation isn’t just delegating the responsibility for completing the tasks, but it is also delegating the authority to oversee the entire project. The most effective managers don’t need to micromanage every decision and every task. They understand that they must relinquish some control to free up their time to accomplish the most important task of growing their business.
Ensure your sales reps spend time and resources on the right customers
Customer Lifetime Value (CLV) is a metric that represents the total net profit of any given customer. This metric can help a company determine what it can expect in terms of future sales from certain customers, and how much money to invest in new customer acquisition. With this information, a sales manager can prioritize their sales reps’ time and resources. For instance, it would be worth the extra time and expense of additional business hours for a potential customer who is expected to yield a high CLV. On the contrary, a manager might limit the time and expense spent on a potential customer with a low CLV. A sales manager may decide to offer a discount or loyalty program to high CLV customers in order to increase the customer’s overall satisfaction and loyalty. To learn how you can measure CLV, download a copy of our reporting metrics eBook here.
Make fact-based decisions
Effective managers will make important decisions based on facts rather than gut instinct alone. They know that data provides a reliable and unbiased view of what is going on in your business. When managers rely on their company data, they are positioned to effectively manage profitability and growth. According to research by Bain and Co, companies using analytics are 5 times more likely to make faster decisions.
Always stay on top of trends in your business
With the 360-degree view of your company provided by business intelligence (BI), managers are empowered to follow their train of thought and discover new opportunities, identify trends as they are occurring, and spot potential problems that can be turned into opportunities. Our customer Mike Smith of Johnston Companies found implementing Phocas offered a nearly instant ROI. "Five minutes into the demo, I had found items that didn't have the margin I was expecting, customers that didn't have the profitability I was expecting and vendors that weren't performing the way I expected. I realized that we were onto something that would be very impactful to our business."
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