Business Management Mistakes Avoid At Beginning Of Year
Not having a clearly defined strategy or the lack of an entrepreneurial culture in which innovation and talent prevail are two big mistakes that impact business performance and productivity. These are aspects that should be taken into account from the beginning of the activity, and that should be reviewed and updated periodically. Beyond these critical elements, the lack of long-term vision, undervaluing the power of training and knowledge management, and not having the right technology to streamline processes and harness the potential of data may be the principle of End of any business.
The beginning of a new exercise implies the start of new formulas and initiatives aimed at improving the results of a company. It is the opportunity that many businesses take the opportunity to review and commit to new management models and more efficient distribution of tasks. Among the purposes for the coming year, proposals such as cost reduction, optimization of resources, and efficient use of information usually stand out.
But the approach of initiatives oriented in this direction often reveals some of the shortcomings with which some small and medium enterprises operate in environments as convulsed as the current one. The lack of time and clear criteria when making decisions - usually derived from a poor analysis of the information they handle - often reveal some of the most common management errors among SMEs.
From Data, the five mistakes that no company should make, even less, at the beginning of the year stand out:
FIRST
Not clearly define a strategy for the management of business resources or define an excessively rigid and impervious strategy. When operating in an environment where competitors abound, and resources are scarce, it is necessary to focus on differentiation and continuous improvement. But, none of this can be done without an adequate approach to the management and distribution of the resources available to the organization.
Knowing all the criteria that impact on the competition, on the environment or on the company itself is the basis for defining an appropriate strategy. But, determining the plan is no longer enough. SMEs should focus on the precise definition of a flexible approach that allows new processes to be implemented and provides rapid and effective response models. That is, at the beginning of the year, SMEs must verify not only that their strategy is optimal for meeting the established objectives but also that it is a porous and flexible strategy capable of adapting with skill and speed to the changes proposed in the market and the different scenarios that happen.
SECOND
Lack of business culture or identity. A company is not what it says it is, but what it shows it is. In other words, a business that claims to be differential in its proposal must demonstrate with real data how it differs and why. And, in the SME ecosystem, we do not always find a clear definition of the differential value of the company. Or, instead, we don't always find a way of operating that is truly differential. Nor with solutions and/or services that provide that bonus that companies promise. The differentiation can be in the way in which the company internally manages its business, in how it relates to its suppliers, with its customers, with its employees, in how it negotiates its payment and payment conditions or in how it establishes relations with all the actors that make up the value chain.
THIRD
Lack of a long-term vision. It seems a contradiction, but in convulsive times in which the shadow of the economic slowdown lurks is more crucial than ever to plan with an eye on the long term. Short-term approaches show quick results - good or bad - but they lead to accelerated and almost always wrong decision making. They leave no room for innovation or the proposal of value-added solutions, among other things, because they do not take into account the analysis of the data and cannot look at the consequences of their decisions in perspective.
Without a long-term approach, companies run the risk of patching their management and operations. They will be exposed to a high risk of managing their growth, even to maintain their stability.
FOURTH
Undervalue training and knowledge management. Training and the generation of value through knowledge are two key aspects to boost growth and continuous improvement. If the importance of exercise in acquiring the appropriate skills and training for each moment is not recognized, the workforce may be poorly distributed, the workload is poorly distributed, and not able to provide the necessary answers and value. If besides, companies do not manage knowledge, in an agile and collaborative way, the information will be diluted between the different layers that make up the organization, data silos will be formed that will isolate the data, and the learning opportunity will be lost that offer collaborative work strategies.
FIFTH
I am not having the support of the right technology. Managing a company's resources is not something that can or should be done manually. It is necessary to have the appropriate management systems, which are adapted to the nature and needs of the business and that report a real added value to the proposal - even commercial - of the organization. But not all SMEs are aware of the importance of the use of technology and its impact on the income statement. One of the big mistakes that SMEs make concerning technology is to understand it as an expense and not as much as an investment that will bring value to the business.
Another of the failures that many small and medium-sized companies commit from technology is not to value their contribution to optimize the forecast, analysis, monitoring and control of resources, but also of the tasks that are carried out, out within the organization. Minimize errors and automate functions to save time that can take advantage of the performance of other duties of more excellent value, should be the ABC's of business. What's more, it isn't always similar to that. Concerning technology, solutions that adapt to the company are not still sought, but rather, they are committed to “cheap” or “powerful” solutions or “known” solutions and not so much to those solutions that help improve the profitability of the business.
In short, the beginning of the year is an excellent time to review, analyze, and make decisions about how we want to manage our business resources. It is the best time to launch new approaches, new processes, and new technological tools that drive growth, innovation, and permanent improvement.