Running a business is a complicated and difficult endeavor. When a company really takes off and grows exponentially, it needs to engage in proper business administration to run the daily operations and ensure future success. Business administration is the management of business operations, including the planning, organizing, staffing, directing and controlling of resources to achieve specific goals and objectives. When a business becomes large enough, the roles within the organization change and different individuals are hired to lead teams and implement practices so that the business keeps growing.
Employees, team leaders, managers and executives are just some of the roles that make up a business hierarchy. The roles and responsibilities of managers and executives differ in scope and focus, but both work toward the same goal of making their organizations successful. While both managers and executives play important roles in business administration, there are differences in their responsibilities and areas of focus. Managers tend to focus on more tactical issues within a specific area of responsibility, while executives focus on broader strategic issues and the overall performance and success of the organization.
Managers typically have responsibility for managing a department or team within an organization. Their primary focus is on tactical issues such as staffing, scheduling, training and performance management. They are responsible for achieving specific targets and goals within their area of responsibility. They are also responsible for planning, organizing, directing and controlling the resources and activities of the team in order to achieve specific goals and objectives.
Managers are responsible for developing strategic OKR plans, setting goals and objectives, and determining the resources required to achieve them. They implement planning in business administration by following a systematic process that involves several key steps, including defining goals and objectives, conducting situational analysis, identifying alternatives and options, developing plans, establishing budgets, implementation of plans, monitoring and evaluation.
These business professionals need to understand the overall goals of the organization, and then create specific objectives that will help achieve those goals. They need to analyze the internal and external environment of the organization to identify opportunities and threats, as well as strengths and weaknesses. Strong managers also need to develop various alternatives for achieving the objectives and evaluate the pros and cons associated with each option.
Once managers have reviewed alternatives, they need to develop a comprehensive plan that includes specific actions to be taken, timelines, resource requirements and performance measures. They also need to establish a budget for the resources required to implement the plan, including staffing, equipment, materials and supplies.
Implementation is where the actual plan is put into action by allocating the appropriate resources, assigning tasks to staff, and monitoring progress to ensure that the plan is implemented correctly. Managers will then monitor the progress and evaluate, making adjustments if necessary. Learning the basics of management in business administration is one of the many skills taught in a doctorate in business. Accredited online schools such as Aston University teach students how to lead in their chosen industries and be effective managers and executives.
Managers need to organize the resources available to them, including personnel, finances and equipment, to ensure that they are used effectively. They use a variety of techniques and strategies to organize their company or team effectively, including establishing clear goals and objectives, creating an organizational structure, developing efficient communication channels, and implementing technology.
Managers set achievable goals and objectives for their team, department or company. These goals should be specific, measurable and time-bound. They also decide on the structure of their company or team, including the reporting hierarchy, workflow, job descriptions, and roles that will best help their team reach their goals.
Assigning specific duties and responsibilities to their team members based on their strengths and expertise provides an opportunity to delegate appropriate tasks to the right team members, ensuring that everyone is working on tasks that align with their skills and strengths. They also open efficient communication channels with their team members, enabling them to communicate effectively and access information when needed.
Using technology can help managers organize their business operations efficiently, including through project management software, communication tools and other automation tools that streamline workflows.
Managers need to provide guidance and direction to their team members to ensure that they understand their roles and responsibilities and are able to work effectively. Once the manager has organized the team and assigned roles, the next step is to guide, motivate and coordinate personnel toward achieving common goals. Some ways that managers direct their teams include opening the lines of communication, providing leadership, training staff, performance management and resource management.
Good managers use different communication channels to keep their team informed of expectations, goals and progress. They serve as leaders, providing direction and guidance to their team members. They inspire their team to achieve common goals and motivate them through positive reinforcement and by setting an example. A manager must also ensure that team members have the necessary skills, knowledge and training needed to achieve their tasks.
These business leaders closely monitor and review their team’s performance to identify areas that require improvement, rewarding outstanding performance and addressing poor performance accordingly. They also coordinate and allocate resources, including personnel, time and supplies, to support their team toward achieving set goals.
Controlling is a crucial function for managers in business administration. It enables them to monitor and evaluate team performance to ensure that goals and objectives are met. Ways that managers use controlling in business administration include establishing performance standards, providing feedback, controlling budgets and finances, quality control, risk management and project management.
Managers establish performance standards and review team members’ performance to determine if they meet the set objectives. They offer feedback to correct poor performance, recognizing outstanding performance and implementing necessary changes to improve results. They also use feedback loops to initiate necessary changes to correct issues and prevent problems from affecting performance negatively.
These business professionals establish company budgets and monitor expenditures to ensure that the business is operating within acceptable financial parameters. They also ensure that business processes meet industry and regulatory standards through quality control measures.
Managers use controlling measures to minimize risk and ensure business continuity through strategies such as assessing risks, implementing emergency plans and ensuring staff safety. They also oversee the implementation of projects through monitoring task execution to guarantee that projects achieve set objectives within a determined budget.
Managers need to make important decisions on behalf of their team, including resource allocation, hiring and firing, and strategic direction. Decision-making is a critical function for managers in business administration that involves making choices based on data, strategies and intuition.
These professionals use decision-making to identify issues that require attention, determining the best course of action toward solving the problem. They assess alternative solutions, weighing up the benefits and potential drawbacks before deciding on an appropriate course of action.
Managers also assess the risks and potential impacts of the decisions they make, considering the implications on the organization’s performance, brand reputation and financial position. They also need to weigh considerations across different stakeholder levels, including customers, employees, shareholders, and suppliers, to ensure that they cater to their interests.
Executives are responsible for the overall strategic direction and performance of the company. Their focus is on broader business issues such as developing the company’s vision and mission, creating a long-term strategy and evaluating business opportunities. Executives often work closely with each other and with managers to develop and implement plans to achieve the organization’s goals. They also have a greater responsibility for managing risk, building relationships with key stakeholders, and ensuring compliance with regulatory requirements.
Setting strategic direction
Executives are responsible for setting the overarching vision, mission and goals of the organization. These business professionals determine the business’s vision and mission statement so that personnel can align their activities to achieve the overall business goals.
They analyze industry trends, government regulations, competition and customer needs to uncover opportunities, while developing strategies to overcome threats. They evaluate the organization’s strengths, weaknesses, opportunities and threats to identify areas of strategic focus. Executives also prioritize objectives that align with the organization’s goals, carefully evaluating which activities will derive meaningful results.
Allocating resources is an essential function of executives in business administration. It involves distributing available resources, including personnel, financial resources and time, to meet the company’s strategic priorities effectively. Executives evaluate business performance regularly, considering sales volumes, cash flow, return on investment and other relevant indicators to determine where to allocate resources.
Executives prioritize their project portfolio, focusing on those that are essential for achieving strategic objectives and allowing the company to remain competitive. They also use cost-benefit analysis to determine the return on investment of projects and programs, identify areas to improve efficiency, and allocate resources effectively.
Managing performance is a crucial function for executives in business administration, ensuring that the organization achieves its objectives within the set performance parameters. They set performance standards, based on the desired outcomes, aligning the standards with the organization’s strategic objectives.
Executives conduct periodic performance appraisals, assess employee performance, provide feedback and identify areas requiring improvement. They recognize and reward team members who meet or exceed the set performance standards, encouraging a culture of high performance.
They create plans to help team members who fail to meet the set performance standards to improve and address areas of weakness. They also provide opportunities for team members to enhance their skills and knowledge, ensuring that they provide excellent performance.
Executives manage risks in business administration by following a structured risk management process. This involves identifying potential risks to the organization, assessing the impact and likelihood of each risk occurrence, evaluating existing control measures and implementing additional controls if needed, and monitoring and reviewing the effectiveness of the risk management program on an ongoing basis. They conduct a thorough assessment of all the risks to which their organization is exposed, including financial, reputation, operational, legal and compliance risks.
They design, implement and maintain controls that are adequate to prevent, detect or minimize the potential impact of a risk occurrence. They should also ensure that all employees are aware of the organization’s risk management policies and procedures, and that they receive regular training on risk management best practices.
Executives can build and maintain relationships in business administration through a variety of strategies such as networking, online presence, providing value, collaboration and personal communication.
Executives can attend conferences, seminars, trade shows and other events within their industry to meet other executives, establish new contacts and acquire new business ideas.
They can also build a strong online presence through social media, which allows executives to connect with other industry professionals and potential customers. Executives should always seek opportunities to provide value to others in their networks, whether it’s through sharing insights, providing helpful resources or connecting people to valuable contacts.
Executives should actively seek out opportunities to collaborate with other businesses and organizations, fostering partnerships that help both organizations thrive. They should also cultivate strong personal communication skills, including active listening, clear and concise communication, and the ability to build trust and rapport with others.
Executives ensure compliance in business administration by establishing and implementing policies and procedures that adhere to relevant laws, regulations and ethical standards. They regularly perform compliance audits, and provide regular training and education to their employees. This education includes key legal and ethical issues in the organization’s industry, along with the specific policies and procedures implemented by the organization.
They should also stay up to date on changes in relevant laws and regulations that could affect the organization and modify the compliance program accordingly. Executives must also ensure that there are effective procedures in place to address compliance violations when they occur, including appropriately reporting, investigating and addressing violations.
Managers and executives work together in their roles to ensure that the organization’s people and systems work effectively and successfully.