The Definition of Small Business Management

by Osmond Vitez

 1What Are Key Performance Indicators For?

 2Organizational Structure Guidelines
 3The Basics in Business
 4About Management Accounting

Running a business takes copious amounts of time and effort. Small business owners are responsible for

managing all aspects of their company. Management is commonly defined as the alignment and

coordination of multiple activities in an organization. Business owners use management skills to

accomplish the goals and objectives of their company. Small business management requires business

owners to use a mix of education, knowledge and expertise to run their company.
Styles

Autocratic, paternalistic, democratic and laissez-faire are a few common styles of management. Autocratic

management allows a business owner to be the main individual responsible for making decisions and

driving the company through the business environment. Paternalistic management looks to create the best

work environment for every employee. Business owners use a democratic management style when they

allow employees to have input or feedback on business decisions. Laissez-faire creates the most employee

autonomy, and allows decisions to be made with little business owner oversight.

Facts

Business owners usually represent the most visible individual in an organization. Business owners are

responsible for creating business relationships to advance their company’s operations. Vendors, suppliers,

distributors and warehouse companies are a few external companies business owners may work with in the

business environment. Business owners coordinate the activities involving these organizations to ensure

that their company has sufficient economic resources. Economic resources represent the raw materials and

supply chain needed to produce and distribute goods in the business environment.

Features

Small business management requires business owners to provide oversight for several functions in the

business. Purchasing, human resources, sales, customer service, marketing and product development are a

few major departments or functions business owners must manage. Larger business organizations often

have more departments or divisions to manage. Business owners in large organizations often delegate

management responsibilities to employees. Delegation ensures individuals provide oversight for business

functions in accordance with the business owner’s management style.

Tools

Business owners often use management tools to help them manage their small business. Accounting,

finance tools and performance management represent a few universal small business management tools.

Business owners use accounting to record and report their company’s financial information. Finance tools

can help business owners forecast production output, potential sales and the amount of external financing

needed for business operations. Business owners use performance management to gauge the effectiveness

and efficiency of their company’s operations.

Considerations

Business technology allows business owners to improve their company’s business operations. Business

owners can use technology to create a management information system. This system transfers information

electronically to the business owner or other managers in the company. Business owners and managers can

make real-time decisions based on current information collected from business operations. Although

expensive to purchase and implement, business owners should consider using a management information

systems to aid them when making decisions.

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