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What Is Business Management - What Is Business Management And How Does It Create Financial Success?

general business managers specialized business managers

A successful business is one where the revenue exceeds the cost of doing business. This profit is created by providing the customer with value through a product or service. Business management is planning and coordinating all the factors that make a business successful. Its overall task is to tackle the problems that prevent the business from providing value and making a profit.

How Business Management Creates Financial Success

The function of business management is to help a company attain various objectives that will result in financial success.

  • It establishes the companies overall goals.

*It formulates and applies a business strategy.

  • It assesses the company in relationship to other companies in the same industry, comparing the company to domestic and foreign competitors.
  • It evaluates how the company is creating value for its shareholders.
  • It revises its strategies to keep pace with internal and external changes.
  • It informs, educates, and motivates the employees to help achieve the company’s goals.

*It coordinates the companies relationship with local and national government and the general public.

General Business Managers

General business managers coordinate the many aspects of a business. More specifically, they have to be knowledgeable about areas like finance, accounting, marketing, management information systems, production, human resources, and research and development. These various areas are further organized by their respective managers. Besides coordinating these areas to optimize a business, general business managers also have to maximize the value offered to shareholders, employees, vendors, customers, and the community.

Due to the complexity of modern business, general business managers are rarely experts at everything that happens within an organization. While they may oversee the entire business enterprise, each department has its own managers.

Specialized Business Managers

Finance managers raise money for the company by tapping into various markets like the banking industry, the stock and bond market, and the individual and public debt market. They also allocate how the funds should be used within the company and evaluate how the various departments are using the money that they had previously received.

Accounting managers determine costs like the cost of salaries, equipment, and the other costs of doing business and compare this with the companies assets and income. They determine and record the firms assets and liabilities, cash flow, tax liabilities, and profits.

Marketing managers research the market for the companies products and services, determining what factors in a product create a sense of value for the consumer. They look at the features and benefits, quantity, and price of the companies products and services and decide on how to best promote and advertise value.

Managers of Information Systems coordinate how information flows within a company and out to its vendors and customers. They also provide the company’s employees access to information on the World Wide Web.

Production managers purchase raw materials, supervise the process of production, inventory the final products, and control distribution, including packaging and shipping.

Human resource managers take care of the work force, making hiring decisions, coordinating termination decisions, training new staff, conducting trainings for employee groups, evaluating and rewarding top performers, and charting and evaluating employee progress.

Research and development managers are the visionaries of the company, looking for way to improve efficiency and evaluating new technologies. They aim to improve the quality, efficacy, and range of the products and services of a company.

In summary, by understanding what is business management, its role in a company, and how the various expert business managers coordinate their efforts, it’s possible to fully appreciate the many factors that go into creating a firm’s financial success.

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