Once the financing is in place, the location secured, the capital assets purchased and operations commence, the success of the business depends on one strategic aspect...its management.

Owner/managers can sometimes find themselves so immersed in the day-to-day operations of the business that they recognize only too late that being busy doesn't guarantee success. Successful management requires handling day-to-day operations while keeping a trained eye on the big picture.

Small business operations parallel those of a multinational company except that a smaller business has the benefit of fewer lines of command. The small business can often modify strategies and respond to market changes far more quickly than a large business can. On the other hand, the owner/manager may have to wear several hats - that of chief executive officer, chief financial officer, chief operating officer, advertising specialist, distribution expert, information technology wizard, and sometimes more. This constant balancing act demands careful planning and fine-tuned time management skills. Most important, the owner/manager needs to be able to make good judgment calls when faced with several options for maximizing the company's talents and its profits.

 Here are some cardinal rules that can help ensure the success of your business.

Gain control by letting go

Accept that you cannot have a hand in every function of the company's operations. One sensible solution is to manage by exception. Set out specific criteria that indicate when you must become involved and entrust your staff to do their jobs. For example, set out production quotas, minimum inventory levels, and maximum periods for outstanding accounts receivables. When staff have measurable benchmarks and standards, they will be able to perform up to their levels of authority but more importantly, will know which situations require your direct involvement.

Get things done

If processes are becoming too complex, find ways to simplify them. If you have too much to do and too little time, delegate those tasks that do not require the top manager's full attention but keep on top with good reporting systems.

Anticipate and respond to your customers' needs

Communicate with your customers on a regular basis and listen to their needs. Anticipate and respond quickly to changes in your market. Keep in mind that your competitors are doing the same thing and if they find a weakness in your strategy, they will quickly find ways to fulfil that customer need and increase their market share. While you need to continually seek new customers, do not do so at the expense of neglecting your existing customer base.

Learn from errors and missed targets

When a customer is dissatisfied, a process takes longer than expected, or the costs exceed budget, assess the problem and act quickly and decisively. Then document the problem and the solution. You may not recover the customer or the lost time or money, but the lessons learned can help you realign procedures or processes and avoid these problems in the future.

Focus your objectives

What business are you in? How often do you revisit your mission statement? Accept that you may not be able to be the best in all areas and focus on those goals where your business can exceed the value, quality or service delivered by your competitors. Your strategy may be as simple as acquiring the assets that can enhance productivity or it may require letting go of some less profitable products or services in order to focus on those that bring the most rewards. Make sure your goals are specific, measurable and achievable, with the responsibility for results fixed and the time or deadline set.

Communicate the company's objectives

Communicate the company's objectives to your employees and focus everyone's time and energy on achieving them. When you do achieve or exceed a goal, celebrate the success by communicating the win to all employees and giving special recognition to those who made the difference.

Focus on your company's expertise

Venturing into areas that are completely unknown to your business is a high-risk strategy that may hold little reward. Stay on course with what your company does best in its particular market. Build from your strengths in these areas to develop related products or services as the company gains experience and the funds for expansion become available.

Encourage feedback

The company is only as successful as the team that makes it work. Find ways to encourage staff to suggest improvements to products, processes, or applications as well as inform you when they identify new business opportunities. Also, encourage your customers to offer suggestions for improvements or related products or services. With both staff and customers, consider focus sessions, surveys and other means for ensuring you know if your products or services need to be re-examined to meet changing market demands and your competitors' actions.

Talk to Logan Katz LLP

Logan Katz LLP can help you determine the information, systems and processes you need to achieve your goals as well as identify those goals that need to be refocused or reshaped. The next step is to revise your business plan and budget to reflect these goals. Setting out your strategic plans and measurable goals can help you shape your company's resources and efforts into an overall strategy for success.

The above provides general information only. It should not be regarded or relied upon as accounting or taxation advice or opinions. Logan Katz LLP Chartered Accountants would be pleased to provide more information or specific advice on matters of interest to you.

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