5 management issues often overlooked

Running a business can be difficult. And business owners can sometimes get so involved in their day-to-day activities, that they overlook some very important longer-term tasks that need doing. Here is a brief overview of 5 of the most common management issues, that I come across, that are often overlooked by small businesses and some suggestions on how to overcome them.

1. Having insufficient systems
Too many business owners have few, if any, documented procedures for operating their business. Having good, proven systems in place for every aspect of the business is vital to operate efficiently. Everything from sales, HR, marketing, IT backup to even how to answer the phone, constantly updated and based on what you know works, should be documented in a business operations manual. It means you don’t need to constantly be explaining the same thing over and over again, spending time training, supervising and constantly intervening in employee’s work. If it’s written down as standard procedures you don’t need to keep reinventing the wheel. Having great systems in place is something that should be implemented from day one and revised and improved as your business develops.

2. Failing to plan
Failing to plan is a big problem for many small businesses. If you’ve no goals or specific plans for your business and you allow it to operate with no clear direction or guidance, you run the risk of constant distraction, and the business may not go anywhere. In addition to creating a business plan before you commence operations, a good idea is to spend some time at the beginning of each year setting out realistic, achievable goals and clear plans on how to reach them. Put this on a single page and put it somewhere you can refer to it regularly. This is a critical tool that helps you both state where you’re going and how you’ll get there. You just need to follow this plan and revisit it at the beginning of each year.

3. Wearing too many hats
One of the most common issues for business owners is a lack of time. Running a small business, especially as a sole trader, means you have to be the marketer, sales representative, product development expert, finance manager and perform another half-dozen different roles. This means you can be easily distracted from one task to another without completing any properly. It takes real discipline to complete each job and do it well. Look at where you spend your time and effort, and maybe you’re better off focusing on your core business, and should consider outsourcing other tasks.

4. Undervaluing what you do
Whether it be a lack of confidence, fear of failure or just because you’re starting out in business, many small businesses under- price their products and services. This is a dangerous path to take because it undermines the unique value you offer your clients. Bouncing back from initially setting too low prices is difficult to do, so you should explore the market thoroughly as you start your business to identify the best price entry point for what you’re selling.

5. Having no exit plan
Every business owner will eventually exit their business, but very few give enough thought to how this will take place. The reasons for exiting include decreasing profits, increasing competition, changes in health or life goals, retirement or passing a business on to family members. Whether you decide to exit voluntarily or because you have no choice, you will need to have a plan. The most common ways of exiting a business are:
• through succession planning which involves a transfer of control,
• closing your business which involves selling off business assets, paying off debts and keeping whatever money is left or, the best option,
• you can sell your business. Any potential buyers of your business will be looking for a reliable revenue stream, a healthy profit margin and a business that has established systems and procedures in place. If you can demonstrate that your business is profitable it can be worth a great deal of money to a potential buyer and set you up with a financially rewarding way out.
Whichever way you end up exiting your business you need to have some sort of exit plan in place.