When you’re finding your feet as an entrepreneur, everybody wants to talk to you about your vision, the team you’re building, how you’re finding finance – everything but your daily operations. It’s a climate in which it’s all too easy to lose track of administrative matters and to fail to focus on the nuts and bolts of how your company is run. Be warned, doing so can be fatal! No matter how efficient your employees are, it’s ultimately down to you to ensure things stay on track.
Joey Horn is a business administrator whose expertise has taken her right to the top and seen her work for companies such as Saks Fifth Avenue, Asia Offshore Drilling and The Boston Consulting Group. She believes that it’s how a company is organized, and not just what it produces or the services it provides, that determines its chance of success. But why is good organization so important?
Maintaining an income
At the top of the business, the focus tends to be on the future – what new assets you can obtain, what deals you can make. Don’t forget that no form of income is more valuable than regular income – unless you’re making money day to day, everything else is moot. With this in mind, it’s vital to keep a close eye on your turnover and make sure you act if your income starts to slide. That is particularly important if your business is still too small to have a finance team or even a specific finance director. You may have staff who step in part time to manage bookkeeping, payroll and so on, but it’s essential that you have oversight of how these factors fit together.
Increasing the value of assets
Ultimately, the value of your business depends on two things: how much money it’s bringing in on a regular basis, and how long it has been turning a profit for. This means that if it’s managed well, it will gradually become more valuable over time, and it’s why many business owners opt to play it safe. If you’re excited by the more visionary side of doing business, however, you can still benefit from this if you make sure that the main body of your business is protected from disruption. It’s one thing to spend your profits on new ventures, another to put those profits at risk by disinvesting in parts of the business that might seem less important but that really need the money.
Protecting your reputation
Smooth business operations don’t only impact your company directly – they also send a message to your customers. If you’re taking too long to process orders, respond to enquiries or arrange meetings, you’re going to get a bad reputation, and that could undermine everything you do. That makes it essential to ensure that you have adequate administrative staffing and that your staff have the tools to do their work efficiently.
Staying on top of data
When staff are under-resourced and struggling to keep up with normal business operations, the first thing that tends to suffer is proper record keeping and data management. This can escalate very quickly into a really difficult situation, creating legal risks if you are unable to file reports in a timely and adequate fashion, and slows down your ability to access information you need. It’s a difficult situation to get out of because looking for a lost piece of data can take minutes or even hours longer than simply dealing with that data properly in the first place, so it’s much better to stay on top of things initially than try to resolve matters latter.
There’s always room for improvement
Perhaps the day to day operations of your business are running well. Does that mean you can afford to pay them less attention and concentrate on other things? It might, but it would be risky – and it would mean that you’d be missing out on an opportunity. Taking the time to look for better ways of managing your business operations could save you a lot of money going forward. Technology is continually improving so there are always new options, and as an entrepreneur you should be learning all the time. Remember that in business, if you’re not progressing efficiently, sooner or later your rivals will overtake you.
Business operations may not be what make headlines but they’re at the core of what you do. Neglect them at your peril.