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Best management practice and KPI's: Why you need them


Written by Lee Turton of Mossvalley Management Ltd.

Business management is a collective part for those who are part of the decision making for your business, from SME’s to Big business BM (business management) plays a major role.
BM is the optimum allocation of resources which will determine the business organisational goals, you will deal with crucial decisions and steps that your business needs to achieve in order to meet your targets. BM will give you your long and short term objectives and your required profit margins.


BM deals with:
  • Planning
  • Organising
  • Directing
  • Controlling
Planning can be undertaken by you, you’re manager or supervisor, and Organising will again be carried out by you, the manager or supervisor. The directing process is carried out by you this is where you will direct the business in the way you had all planned too, you will also control the process and evaluate the output towards you’re objectives. There are three planning objectives Tactical (short term) and Strategic (long term) and Contingency (back up).


The contingency plan should only come into existence if your primary plans (tactical, strategic) do not meet your desired objectives. Upon completion of your business management strategies I personally would move onto Best management practice.


Best management practice is used by many different businesses and is fundamental on your success rate.


As your business grows (Hopefully!) you will need to adapt to changes, a good route I follow is to look how other successful businesses operate and introduce some of their ways of working and “tweak” it a little to suit your business.


Best practice management involves you too:
  • Communicate on a clear mission and strategy
  • Lead by example
  • The setting of targets
  • An open communication management style
  • Clear and careful planning both tactical, strategic and contingency wise
KPIs are (key performance indicators) are a good way on seeing how your business is doing thus giving you chance to see what progress is being made and whether you are achieving you goals and objectives. If you are not achieving then the KPIs give you a chance to see which areas need attention. KPIs should be related to your overall objective and clearly state where improvements are to be made.


Below are tools I often use when looking at a business and how they are performing they are:
  • Benchmark
  • Forecast
  • Strategic plans
  • Performance monitoring
  • Financial objectives
By having good communication with your employees, fellow directors or if you are a sole trader is essential to having a good business model to build on.


Have a look around your business and is there anything wrong? What can be improved? How is the business performing?


If your answer is nothing can be improved and there is nothing wrong then I’m afraid you’re wrong!! Have a closer look and do some surgery on you and your business, you will find the answers!! There is always room for improvements!


Look and implement the above if you haven’t already done so them I’m sure you’re well on your way to being a very profitable business built on good foundations.





About Lee Turton

Lee Turton is the Managing Director of Mossvalley Management Ltd. After working in the manufacturing industry for over a decade, Lee is an expert in showing businesses how they can make substantial cost savings in production and re-orgainse processes to allow for increase profits.


1 Comments

Photo
Anil Singh Bist
May 23 2012 01:56 PM
Its a nice article,its very helpful
thanks LEE TURTON..hope we will get more valuable article from you soon.
Best of luck ....

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