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Learn More about Management in Business: Definitions, Functions, and Elements

Written on June 13, 2019   By   in Accounting

In running a business, a person needs to explore the science of management. It is this business management that can help you manage and run your business correctly and precisely in order to reach the set targets. Without this, your business or business can be messy and neglected.

The problem is, not everyone has a background in management, maybe you are even one of them. So, does this mean that you have to go to college for about four years to explore it?

Of course not. However, at least try to learn basic things related to business management, which also includes financial management and marketing. Basically, management functions to regulate the course of your business so that it forms order that can facilitate you in achieving your goals.

Understanding of Management

When viewed from the etymological side, management actually comes from ancient French, namely “management”, which means the art of carrying out and regulating. From the etymological meaning, some experts in management science develop it into a longer definition.

Ricky W. Griffin, for example, defines management as a process of planning, organizing, coordinating, and controlling resources to achieve goals effectively and efficiently. This is in line with Henry Fayol who said that management is a science that contains five main ideas or functions, namely designing, governing, organizing, controlling, and coordinating.

There is also George R. Terry who refers to management as a typical process consisting of actions: planning, organizing, mobilizing, and monitoring that are carried out to determine and achieve the targets set through the use of human resources and other sources.

Well, from the various definitions, it can be concluded that management is a process of planning, directing, organizing, and controlling activities to achieve organizational goals effectively and efficiently through the use of organizational resources.

Management function

There are at least four main functions possessed by management, namely:
Planning (planning)

In this function, management has a role in setting goals or objectives to be achieved by the organization, then planning the best way to achieve these goals. Depending on the scale of the company, this plan can usually be done several times, namely for the benefit of the company as a whole and break down again in more detail for each division. Usually, managers will evaluate various alternative plans before choosing what plan to choose and the most suitable to be implemented to achieve company goals.

Planning is arguably the most important basis of the entire business management process. Consider planning as the foundation of a house that must be built strongly. Without careful planning and detail, your business process might not work as expected.

Organizing

After planning carefully, it’s time to change the plan into something real. However, for that, you need to make sure that certain tasks or activities are done by the right people. This is where the organizing function will help you. Usually, organization in a company is divided based on the main functions, such as marketing, accounting, production, administration, and so on.

Well, each of the main functions is ideally known by each manager who is responsible to the president director. Organizing can also be done by determining what tasks must be done, who should do it, who is responsible for the task, to the extent to which decisions must be made.

Directing

At this stage, each member of the team ideally knows what they have to do to achieve the company’s goals. Even so, they still need encouragement in order to continue to be motivated to work. This is where the function of directing in management is needed. Usually, the directing role is carried out by a manager in each division. They will conduct guidance through influencing and motivating methods.

Controlling

In order for every process in management to run optimally and according to plan, it is necessary to apply the control function. Generally, the control function includes four activities, namely to determine achievement standards, measure achievements that have been achieved, compare achievements that have been achieved with achievement standards, and make improvements if there are deviations from predetermined achievement standards.

4 Types of Management Required for Business

In order for the business to run optimally and in accordance with a predetermined plan, several other types of management are needed, namely:

Financial Management

As the name implies, financial management functions to regulate the company’s finances so that cash flow is stable so that expenditure is not greater than business income. With financial management, all components of business finance will also be neatly recorded, making it easier for you to analyze and increase opportunities for more accurate and strategic decision making.

To be more optimal, the use of technologies such as Sleekr Accounting is highly recommended because it can do banking integration with an automated system. All financial data, from profit margins to accounts payable is also available in real time so you can always get the latest data.

HR Management

There are many elements that play a role in business success. One of the most important is human resources (HR). Humans are the ones who have control over other elements, for example money, material, or machinery. Because of its crucial role, special handling is also needed, which is also called HR management. With the right management, HR is expected to be able to work together well, effectively and efficiently so that the goals can be achieved.

Operational Management

In business, operational management can help you to ensure that daily operations are carried out according to the plans and policies that apply. These operational activities cover everything related to the production process, from raw materials, machinery, technology to the methods applied in converting raw materials into certain products.

With operational management, you can ensure the best quality for raw materials, know the amount of raw materials that must be provided, the time needed in the production process, how to do time and energy efficiency, and many others.

Marketing Management

In order for the product to reach the user’s hand, you need marketing. Especially if your product is classified as new, then you must be a more active party to do a promotion to make the target market know the presence of your product. It is the marketing process that can help you in this matter, namely through a number of choice strategies that have the highest opportunity to bring success.

Management Elements

In business, there are six elements that influence the success of a business. These elements are interrelated and cannot be separated from each other. If one element does not exist or is not optimal, it can make it difficult for the company to achieve its objectives. Here are the elements:

Human

It is no exaggeration to call human resources the most important element in business management. In the absence of humans, companies cannot determine goals and develop the best plans to achieve these goals. Humans are the ones who control the other elements of the business.

Money

Since the beginning of establishing a business, money has become one of the most crucial things, namely as capital. Apart from being a medium of exchange, money can also function as a measure of value. The success of an activity or sale can be measured based on the amount of money circulating in the company.

As an element of management, money can help you to calculate business rationally. This is related to how much money must be provided to buy a new machine, to pay the employee’s salary, to how much to get for profit.

Materials

There are two types of ingredients in the ingredients, namely semi-finished materials and finished materials. In the absence of materials, we can be sure that you will have trouble producing the product you want to sell. All plans drawn up can be useless and prevent the company from achieving its goals.

Machine

You already have the ingredients needed to make the product. However, the production process can be hampered if you do not have a qualified machine. Also keep in mind that in this case, the engine is not only limited to factory machines to produce goods. Machines such as computers, printers, and photocopiers also have important values ​​in your business processes.

Methods

This one element helps you and the team to run each management process effectively and efficiently. Therefore, you need to determine the best method to be applied in the company. From here, continuity will usually be found between one division and another division so that you and all employees can work side by side properly.

Market

No matter how good the quality of the product is created, it will be useless if there is no adequate demand or market. If this happens, chances are that the production process will stop, threatening the company’s success. Therefore, you also need to do marketing to attract the attention of your target market. Arrange strategies that can attract them.

Management is needed in every business or business. In order for the process to run smoothly, there is no harm in using software technology such as Sleeker Accounting which can simplify your accounting system. Starting from making financial reports, journalism, invoice monitoring, business performance, to debt and receivables, all can be done with data stored in a systematic and safe manner. This certainly will greatly facilitate you in taking various important decisions.

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