Business Management Skills You Need to Succeed

Managers in any business are key. They lead employees, spearhead projects, and take initiative. Managers wear many hats and that's especially true in a small business, where the owner is the business manager. Here are skills needed to lead a successful operation.

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What are business management skills?

Business management skills are any qualities that a small business owner should possess to best prepare their company for success. These skills are vital for increasing your company’s chances of long-term success, as even though they mostly pertain to relatively simple everyday actions, their cumulative effects result in a more efficient, productive business.

The following business management skills are essential:

Financial skills

Getting your financial systems and processes in place can be difficult for a business owner. Not every entrepreneur has advanced skills to handle the complex financial duties required to run a business. Paying taxes and managing payroll can be especially difficult-you can even end up in legal hot water if not done correctly.

Check out our comprehensive article, All About Small Business Financial Management. You’ll learn key financial business terms like cash flow and net profit. We also share the documents you’ll need to accurately track your financials like a balance sheet and revenue forecast. Finally, we recommend a number of software solutions to help you manage your finances.

If you have the budget, hiring a financial professional is a great idea. Find an expert familiar with small businesses or with experience in your industry. Our blog post, How to Hire an Accountant for Your Small Business, has an overview of services provided by an accountant and outlines signs you might need one.

Additionally, creating a realistic budget is part and parcel of running a small business. Without successfully managing your money through a budget, you could find yourself out of cash for certain important business needs ranging from materials to payroll. Learn more via our blog post: How to Make a Business Budget.

If you’re seeking outside funding, know where you stand financially before you apply. Consider signing up for SmartBiz Advisor. This free tool acts as an “ Intelligent CFO”, revealing your numbers in key areas banks consider. Get your “loan ready” score* here.

* The Loan Ready Score is for educational purposes and is not the same as scores used by lenders for credit decisions.

Marketing/sales skills

It’s no longer possible to just ‘figure things out’ when it comes to sales and marketing. If you don’t have in-depth knowledge of today’s marketing channels and sales tactics, you could be missing out on a ton of business. The good news is that there is a wealth of educational information out there to help you hone your marketing  and sales skill set. From simple (and free) YouTube videos to community college classes to online workshops – there’s no excuse to stay in the dark. If you’re concentrating your efforts in other directions, you can hire a seasoned employee or bring on an outside consultant to help with these important tasks.

Communication/negotiation

From negotiating salaries to working with vendors, negotiation is an important component of a small business. Career experts Right Management have outlined specific steps to think about that can improve your communication skills:

  • Listen, listen, and listen
  • Who you are talking to matters
  • Body language matters
  • Check your message before you hit send
  • Be brief yet specific
  • Write things down
  • Think before you speak

If you feel that your communication and negotiation skills need some work, reach out to a mentor or enroll in an online course.

Leadership

Poor leadership can affect a small business in a big way. There are many styles of leadership, but the fundamental skills of a good leader are generally the same. You need to create a sense of engagement with your team so they trust you and want to help you reach your business goals. Our article, 3 Leadership Qualities of a Small Business Owner, explores qualities you should strive for when leading your business. You’ll learn about the importance of being an active listener, how to be forward thinking, and the best ways to delegate. Speaking of which…

Delegation

Effectively setting business goals (and then meeting them) requires teamwork. That’s why you’ll need to unlearn your impulse to handle all business tasks yourself and instead delegate them to your team – after all, your employees are there to help. And if you’re worried about keeping your team on track with its tasks as you delegate, another important skill can address that concern.

Accountability

As a leader, you’ll need to be accountable to your team, your investors, your customers, and your community. That’s why accountability is a crucial leadership skill, one that should rank among your company’s core values. A company that adheres to accountability principles corrects its errors, keeps its clients satisfied, and encourages its employees to guide and constructively criticize one another.

Project management

Project management is the way you organize and manage resources needed to complete a project with a start, an end, and goals. A business owner might take the reins or hire a dedicated project manager to spearhead business projects. No matter who is tackling the project, a business owner needs to know what makes project management successful. Our post, 10 Secrets of Successful Project Management, outlines 10 habits to help set you up for project management success. You’ll learn about top-down views, how to ask the right questions, and the right way to learn from your mistakes and move forward.

Time management

At SmartBiz, we get the opportunity to speak with our customers to learn about their entrepreneurial journey. Time management is a hot topic. As one SmartBiz customer says, “The business is my baby and the hardest thing is to turn off that switch. I’m up between 7 and 8 am and on the computer till noon. Sometimes I’m on the phone till 1 am in the morning. I haven’t found the sweet spot of work/life balance.”

Are you still looking for that “sweet spot”? Check out this post for actionable ideas to help you get balanced: 9 Tips to Improve Time Management Skills.

Networking

Getting your name out there and building relationships are keys to any successful business, regardless of your industry. Networking is a great way to elevate brand awareness and connect with other professionals, current customers, and potential customers. There are many situations appropriate for networking. The SmartBiz Blog has an article with information you can use to get out there: How to Turn Any Event Into a Networking Opportunity.

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Decision-making

A cornerstone of business management skills is the ability to make a decision and stick to it. Entrepreneurs make thousands of decisions when establishing their business. A decision might be small, like determining the right printer for your office. A big decision may have large financial implications like deciding to purchase commercial real estate or develop a new product. Use the following steps when faced with a decision – big or small.

  • Step 1: Identify the decision
  • Step 2: Gather relevant information
  • Step 3: Identify the alternatives
  • Step 4: Weigh the evidence
  • Step 5: Choose among alternatives
  • Step 6: Take action
  • Step 7: Review your decision and its consequences

Motivation

Business owners will get a solid ROI when customers encounter your happy and motivated staff. The SmartBiz Blog has an article to help guide you as you come up with a motivation plan: How to Motivate Your Small Business Employees. You’ll learn how to define your company culture, the skills needed to be a cheerleader for your employees, and why responding to feedback is so important.

Problem solving

No matter how much you plan or how strong your business is, problems will arise. From a broken computer to distribution issues, a good business owner will quickly address problems and come up with answers to keep the business moving forward. You’ll need problem solving skills when dealing with staff, vendors, customers, and other stakeholders. Here are five steps for an effective problem-solving process in a small business.

  • Identify the issues.
  • Understand everyone's interests.
  • List the possible solutions
  • Evaluate the options.
  • Select an option or options.

Organization

Staying organized is the backbone of all business skill sets. If your company isn’t well organized, you’ll struggle too, among other things, locate and understand your business documents, properly reach business contacts, and keep up with emails. Our blog 9 Key Small Business Organization Tips will explain more about why organization matters and show you how to get organized.

How to improve business management skills

To improve the above skill sets, consider the following:

  • Workshops, training, or other education.  Workshops and other classes are great ways to learn management skills from the pros and connect with other small business owners whose advice may prove invaluable. If you’re worried about making the time for your classes, fret not – online classes abound, so you can learn business management skills on your own schedule.
  • Mentorship. A 2019 study found that employees feel more valued when they have mentors, and you can tie this finding to your business management skill development. If you find a mentor who can show you the ropes of managing a business, then you might feel more supported and thus more open to learning.
  • Practice. Above all, practice makes perfect. Don’t get down on yourself if, for example, your new communication skills or time management techniques initially fail – identifying faulty approaches is a great precedent to thinking of potentially useful alternatives. These alternatives could help you be the great manager you know you can be.

How to apply business management skills in the workplace

Implement what you’ve learned about business management skills. Try these tips for a successful workplace rollout:

  • Stay organized. Yes, organizing is in and of itself a business management skill, but it bears repeating: Holding a management position requires staying organized on every level. Without a quick, easy pathway toward your business documents, data, and tools, proper management becomes impossible.
  • Plan and prioritize. Owning a business inevitably means having plenty to do around the clock. To best manage your business, you’ll need to plan your activities and prioritize certain tasks over others. With your priorities ranked and planned, you can focus on the business management activities that matter the most.
  • Remain open to ideas. You’re not managing your business in a vacuum. Your management choices affect your employees, customers, investors, and community. That’s why you should remain open to ideas and changes – the more your management style reflects whom you serve, the more likely you are to work with motivated employees, satisfied customers, and all-around excellent people.
  • Address conflicts quickly. Even the best business managers can’t please everyone. Conflict is indeed inevitable, but good business management means not letting tension drag out. To address conflicts quickly, you should explain each involved party’s viewpoint to the others, then identify a common goal and guide all parties toward it.

Final Thoughts

As a business owner, you’re a work in progress. Continually strive to learn the skills you need or strengthen the skills you already possess. There’s no shame in admitting you need help to develop important business management skills. Reach out to a fellow business owner or a mentor or explore classes and workshops to help out. Your business will run smoother with happier employees and satisfied customers.

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