Management skills required to become an entrepreneur

Entrepreneurs are the individuals who have the courage to take several risks and single handedly operate their business. An entrepreneur is a leader, innovator, thinker and motivator for his team. However, it isn’t an easy task to be an entrepreneur. There are specific managerial skills that an entrepreneur must master in order to be successful in his ventures.

The essential managerial skills to become a successful entrepreneur are stated below:

Time Management

The most valuable asset for young entrepreneurs is their time. As an entrepreneur, you have to take care of so many things together and time management is the key to keep everything on track. It is vital to get more work done in less amount of time by eliminating interruptions, prioritising tasks and increasing effectiveness as well as productivity. Effectual time management allows entrepreneurs to assign specific time slots to the activities as per their importance. It also gives them the ability to participate in economic forecasting and market research.

Business Planning

Every entrepreneur needs to develop a business plan or a blueprint of how will he develop his new business. A good business plan consists of a single document divided into several sections including the description of the organisation, market research, sales strategies, competitive analysis and financial data. A well-planned blueprint or project outline acts as a strong foundation for the success of the venture. It facilitates the entrepreneurs to make their business fit into the industry, identify their target market and plan to capture them.

Employee Management

An entrepreneur must know how to manage the people. He should be a good judge of character and abilities of an individual such as hiring the right employee is the foremost step for the success of a company. Successful entrepreneurs should know how to motivate the employees in order to work effectively and contribute to garner customer experience.

Customer Management

An entrepreneur must know how to manage his relationship with existing customers with a focus on creating loyalty towards his business. This is the easiest and most effective method to increase revenues. Entrepreneurs must have problem-solving skills, communication skills, attentiveness and patience to manage customers effectively.

Sales Management

Selling or sale management is an essential skill every entrepreneur must master. You need to completely understand the sale activities. This helps the entrepreneurs to tackle the challenges that they may face in their sale management journey.

Financial Management

Even if your business’s finance is handled by an accountant or a finance professional, you must know planning, organising, directing and controlling the financial activities such as procurement and utilisation of funds. With a good financial management system, one can make decisions to improve the business operations.

Business Management

Being a successful entrepreneur involves more than enthusiasm and a good eye for new opportunities. A thorough understanding of the essential business functions is a prerequisite for entrepreneurs who want to take their business to the next level. They must have the complete know-how of general management, finance, marketing, operations management, purchasing, supply chain, human resources and public relations.

So, these were the essential managerial skills that help the entrepreneurs to succeed and take their business to the next level. If you want to embark on the journey of entrepreneurship, then you can easily brace your skills according to your time schedule with MIT-SDE’s Post Graduate Diploma in Management (PGDM) courses which are not only equivalent to Distance MBA courses but also updated with latest industry trends and happenings.

Four pillars of strategic management

In the present scenario, businesses operate in an ever changing environment that is full of unpredictable risks. So, in order to keep the business thriving, the managers are expected to create a number of powerful strategies. Strategic management thus necessitates the process of formulation of significant strategies by the managers so as to enhance the overall performance of their organisation. Strategic management in an organisation ensures that common goals are set and all the other factors are inclined towards achieving those objectives. It also ensures that the organisation remains flexible towards any external changes.

Strategic management helps an organisation in many ways. It facilitates:

• Faster and effective decision making.
• Capturing opportunities.
• Employee motivation.
• Counteracting threats and converting them into opportunities.
• Prediction of probable market trends.
• Improving overall performance.

It is believed that there are four core pillars of strategic management. These pillars are stated below:

Setting goals

The organisational goals act as the foundation of strategic management. The managers need to identify the purpose of setting strategy, the objectives of an organisation or the problem that needs to be solved. Once he identifies the purpose/objective/problems, only then will they be able to formulate a strategy that will help in achieving those set goals. It will enable him to focus and work towards achieving specific outcomes.

Communication

Communication is an indispensable part of an organisation. Though the strategies are formulated by the top level management, they are implemented by the entire organisation. So, it is essential to have a proper communication channel between the top management and the subordinates. The managers need to explain the strategies to the employees comprehensively, only then will they be able to implement it optimally.

Trust

Trust is the bedrock of any relationship, especially the employee-employer and manager-subordinate relationship. A company that is able to cultivate a strong sense of trust in the workplace is likely to be more successful. The employees that have to implement the strategy formulated by the top management should have faith in the organisation. They should trust the management, only then will they execute the formulated strategy optimally.

Accountability

For the smooth working and successful completion of projects and processes, the top management needs to be held accountable for different things. High level of management is needed to achieve the formulated strategy. This is present in organisation that is held accountable for its execution. Once the goals and objectives are defined, certain people/ top management should be held accountable to ensure the achievement of those objectives. This will lead to enhanced productivity.

Closing note

Strategic management is the art of managing employees in a manner which helps an organisation to attain its stated objectives. It is the task of managers to create powerful strategies and to ensure that the formulated strategies are both effective and efficient. However, the manager who formulates strategies should have a thorough knowledge of the general and competitive organisational environment so that he can take the right decisions. Thus, the aspirants should sharpen their managerial and decision making skills to make themselves a sought-after candidate for the position. You can pursue MIT-SDE distance MBA equivalent PGDM and PGDBA courses to widen your knowledge and brace your skills. The courses are designed in such a way that they inculcate the necessary decision-making skill in future managers so that they can create effective strategies.

Inventory Management– The Most Important Concept To Be Followed In Retail Management

Inventory refers to the stocks that are stored for prospective use or selling. In the retail industry, it refers to the goods that may be under various stages of development or in storage before the selling process. It is the largest asset of retail stores. They are expected to be sold in a year. The term ‘inventory’ is essential in the accounting world. Businesses/Enterprises take a count of the inventory at regular intervals to keep their accounts up to date. The retail companies follow a process of making the inventory available at every point of time and refilling the stocks to avoid ‘out of stock’ status. This process is termed as inventory management.

Significance of Inventory Management

Company or retailers opt for inventory management because one cannot afford to lose even a single customer. If a product is not available at a store, then the buyer will go to other stores and he/she may be averse to come back to that store in the near future as it might leave a negative impact on his/her mind. Inventory management avoids such kind of situations. So, in order to keep the customers intact, inventory management is imperative for every organisation. This concept forms a proper link between the manufacturing of a product and its sale in the market within the preferred time period.

Types of Inventories

Inventory is divided into three forms:

1. Raw Materials: Raw materials are the basic things/objects or key components required for the production of any item.
2. Work-in-progress: These are the semi-manufactured inventories, e. when the goods are still in the process of manufacturing and are yet to be finished.
3. Finished Goods: Finished goods refer to the final goods that are ready for sale or that can be stored in the godowns as stocks for future consumption.

Name of inventories may differ from one company to another. However, the process of inventory management always remains the same. For any organisation, managing the three classified forms of inventory is very important since they vary according to the scale, size, and nature of the business. Some companies even use a new type of inventory namely ‘supplies’ which refers to the bulbs, fuel, plants, oil, etc. The supplies play an integral part in the production and form a small part of the inventory.

Motive of Inventory Management

In general, there are three main motives of inventory management:

Precautionary Motive

The business environment is dynamic and one cannot predict the future as there are chances that the business may face spurt in the demand by the customers. Precautionary motive refers to managing the inventory in order to avoid any unpredictable loss in the future.

Transaction Motive

In the future, a company may face situations such as unavailability of raw materials or finished goods. Transaction motive entails avoiding such situations or any other bottlenecks by managing inventories.

Speculative Motive

Price fluctuations occur frequently and a company can take advantage of this situation in the near future by holding inventories for the stipulated time. This is termed as a speculative motive.

Inventory Management is the core process that marks the success or failure of any retail store. It is an integral component of Retail Management. That is why our course materials of PGDM in Retail Management include lucid lessons on Inventory Management. We provide our students with all the requisite knowledge and skills in Inventory Management that eventually makes them sought-after candidates for the industry.

Four Important Roles of Finance Manager

Finance plays a key role in the overall growth of an organisation. The success or failure of any organisation primarily depends on the efficacy of its financial management. That is why every business, whether big or small, looks for an erudite and a highly-skilled finance professional who can manage the finances effectively.

A finance manager shoulders major responsibilities. For example, all the financial activities within an organisation are undertaken by a finance manager. It is his duty to plan stellar strategies and manage multifaceted activities that ultimately affect the goodwill, financial status and growth perspectives of the organisation.

Some of the major responsibilities of finance manager are:

Fund Raising

Cash and liquidity play a significant role in proper fundraising for a business. The organisation can raise funds either through equity of shares or through debentures. Therefore, there should be a balanced ratio between equity and debentures which is ensured by the finance manager.

Allocation of the funds in the right place

After raising the funds, their proper allocation is the next big step. It is again the task of a finance manager to allocate the funds. The manager should consider the size and growth capacity of the company while allocating funds. He should also keep in mind the kind of assets the firm is holding whether long term or short term. There should even be sufficient funds for the maintenance tasks such as replacement of old plants and machinery. He should also keep in mind the mode from where the funds have been raised. All these factors affect the firm in some or the other way.

Profit and its planning

For every organisation, earning profits is the fundamental aim other than customer satisfaction. Profit gives a reason to the organisation for sustaining and thriving in the market. It is the task of a manager to formulate apposite strategies that maximize profits. However, it needs proper planning.

There are various factors that determine the profits. They are stated as follows:

• Economic state of the firm
• Price of the product
• Cost of production and selling price
• Demand and supply mechanism of the product

Fixed cost plays a crucial role in planning profits. If the fixed cost in not determined in terms of fixed asset and the opportunity cost to recover the fixed cost is not calculated, then the firm may face huge fluctuations in profits.

Considering the capital market

There is continuous trading of shares in the stock exchange market which involves huge risks. A finance manager needs to have complete knowledge about the capital market so as to keep the firm at bay from any such risks. Hence, the main duty of the finance manager should be to calculate the risk in shares & debentures and create a provision to minimize the risks.

A finance manager is one of the key persons of an organisation with a huge role to play. That is why companies hunt for finance professionals and the market is flooded with ample opportunities for the right candidates. Our PGDM in Finance Management is a course that will entail the aspirants with essential skills and industry knowledge so that they can make solid financial strategies & decisions. In a nutshell, they can do justice to their post of finance manager.

Processes in Human Resource Management (HRM)

Employees are the biggest asset of every organisation as their productivity levels are directly proportional to the organisation’s success. However, the guiding principle in every organisation is that ‘general interest must prevail over the individual interest of the employees’. This is possible only through proper strategic planning and execution, which is carried out by the Human Resource (HR) department of the organisation. Thus, the HR department plays a key role in ensuring a successful run of an organisation.

They follow various processes in order to formulate stellar strategies. The processes are stated below:

1. Human resource planning (Recruitment, Selecting, Hiring, Training, and various other processes).
2. Remuneration to employees and other benefits
3. Performance management
4. Employee relations

These core processes should go in a step by step manner starting from planning of Human Resource Management (HRM) to Employee relations. However, Performance Management System may vary from one organisation to another.

Human Resource Management (HRM)

This is the most significant and primary process for formulating appropriate strategy for the organisation. This includes putting the right person in the right place according to his skills and achievements. It starts with the recruitment and goes until the proper training of the employee so that he becomes an asset for the company.

The general HRM processes are as follows:

1.  Recruitment

It is a positive process of posting job openings and attracting prospective employees to apply for their desired job openings in an organisation so that the eligible candidate can be selected.

2.  Selection

Selection is quite a necessary process in HRM. It involves eliminating the unsuitable candidates through the process of tests or interviews and identifying the suitable ones, which are the best fit for the positions.

3. Hiring 

This entails to the process of officially offering the job to the ideal candidate and giving them the date of joining.

4. Training and development 

The hired candidates are given training and their skills are brushed so that they become more efficient in their work and handle future challenges.

Performance management

There should be proper management of the work done and the future goals. Performance management refers to appraising the performance of the employees and enhancing it. For such a management, it is necessary to encourage the employees so as to raise their confidence levels.  This can be done by providing them with fair rewards so that they work in their optimum productivity levels.

Remuneration to employees and benefits

Fair salary or remuneration plays a very important role in motivating an employee to accomplish organisational goals. If the employees get rewards for their best performance, they will get job satisfaction. The rewards not just includes salaries, but it also includes incentives and fringe benefits.

Employee Relations

There should be a sound relation between the employee and the organisation. There are various factors which motivate as well as demotivate the employees to stick with the organisation. These factors include working environment, laboor law and relations, compensation, etc. The employers must ensure all these factors to build employee relationships that in turn garner better employee retention.

Conclusion

So, these were the core processes of HRM. All the processes should be cohesive and in conformity with each other so that HR strategies can gain success. Here at MIT School of Distance Education, we entail all our candidates with requisite skills so that they can follow as these processes effectively.