Most businesses are a reflection of the management that is in place. A well-organised business normally reflects management which is meticulous in its approach to ensuring that all processes are done as required and in order to optimise the business, every manager must play their part. In the previous articles, we have touched on the importance of communication, as well as the triangle for business process optimisation; hence every manager must understand the objective of the business and how to achieve this objective, noting how clients, products and systems relate.
The business is an entity and the people are the minds
A business is not incidental; it is an entity with specific objectives and targets. On a daily basis, the manager needs to know what the objective for the day is. When we wake up we know what we need to do, and how it needs to be done. Our minds are our guides and we make those plans consciously, the same applies to business. The mind of the business is the people; if the people come to the workplace aimlessly, then the business will also move aimlessly. Previously we have covered the importance of key performance indicators (KPIs) in the business; these are a way to provide structured objective purpose to the business. Imagine that your mind shuts down for a moment, you would fail to make any plans and the result is a coma. If a business fails to have a guiding “mind”, then that business will eventually go into a coma of loss-making and bankruptcy. Leadership is thus important in that each manager and employee must be able to consciously make decisions that move the entity forward.
You cannot optimise business until you optimise the manager
If a manager lacks the necessary skills or resources, that business will fail to find its optimum operation. An easy example is of a manager who does not understand the importance of a happy customer in the business optimisation triangle. If a customer pays $5 today, and that customer comes on weekly basis with $5, then that is $260 assuming 52 weeks, and if there are 1 000 happy clients like that, then that is $260 000 coming into the business yearly. A manager or business leader must be able to understand the objectives of the business and what is needed to make money. Any manager who insults clients or is rude to clients regularly, is not a business leader. Real business leadership requires that one optimises their thinking such that they are the perfect fit for the business.
The perfect fit for any business is a business leader who seeks the best for the business process to bring revenue, hence profitability. If the business leader fails to understand what is needed to bring revenue and how to solve revenue problems, then that manager may not be the perfect fit for the business.
For a leader to accomplish their plans, he must have the right resources to be able to optimise what he can. This means ensuring that the plans that they come up with are adequately resourced. If the business is not in a position to resource specific plans, then the manager must work within what the company is capable of doing. Strategy is not about coming up with plans, it is also about assessing the objective, the resources and being able to find a perfect fit. An organisation which is bankrupt on ideas becomes bankrupt in its bank account.
A leader is the catalyst between time and money
In the absence of a catalyst, a chemical reaction may not necessary occur or it will take an unnecessarily long time. Business is about time and how it relates to money. A business operates in time, if it opens from 8am to 4 pm, then that business has eight hours to make use of that time to bring value to the shareholder. Each day is a contribution to the revenue budget, so if the budget is $2 200 worth of sales, and that company operates for 22 days, then each day must contribute $100. On paper, this looks planned and easy but in actual implementation, this may not be done if the manager does not understand the importance of time and money. The manager is that catalyst between time and money. If the manager is on a learning curve and learns how to make $10 a day then thebudget will fail totalling $220 for a month instead of what was the original target.
If we are to optimise the operations of a business and make it function to the levels that we want, then we must make sure that our leadership as well is optimised. Resources are important, but $10 million in the hands of a novice is a loss compared to $1 million in the hands of a mature business manager who can make a profit.
Winston Zvirikuzhe is an Assurance executive at one of the telecom companies in Zimbabwe with extensive experience in strategy and performance management, as well as audit, risk and advisory services.
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