Essentials of a Successful Business
A business has to coordinate various factors of production for achieving a given objective. All factors are equally important for making the business a success. Various departments should work in coordination with each other and organizational and financial planning should be properly determined.
Modern business has become complex and complicated. The improvements in technology and changing consumer preferences are creating more challenges for the businessman. All aspects of an enterprise, that is production, financing, organization and marketing should be properly arranged and coordinated to make a business successful. Some prerequisites of the success of business are given below:
1. The setting up of business objectives is the first thing to be done by the management. One must know as to what is to be done. Only after deciding the objective, the ways and the means will be determined to achieve the objectives. If it is a producing business, the nature of product to be produced, whether to produce the whole product or part of it, should be decided.
2. After determining the objectives, the work should be planned in all its perspectives. Planning involves forecasting and laying down the course of action. It involves planning for both present and future.
3. Organization is an arrangement by which tasks are assigned to employees so that their individual efforts contribute effectively to the achievement of clearly defined purposes. The duties and responsibilities of all persons are defined and they should know what they are to do. An effective organization system is essential for the success of a business.
4. The requirements of finance and its possible sources should be decided at the time of starting the enterprise. The purpose of financial planning is to make sure that adequate funds are raised at the minimum of cost. The required capital should be made available at all times, otherwise it will hamper the work.
5. One of the most important decisions to be made by the management at the time of starting a concern is regarding the location of the plant. The plant should be located at a place where all factors of production are available at lowest costs. The aim of reaching an optimum point will be achieved only if the place of location of the business is suitable. Raw materials, labor, power and markets for the finished products should be available near the place of location.
6. The marketing aspect of a business is more important that even production. There is no use of producing a thing if it cannot be sold. Marketing management is essential for earning profits. Management should decide about the channels of distribution. Whether to sell directly to consumers to sell through wholesalers? It should be decided after taking into consideration various aspects of goods.
7. In the changing technological world, it is essential to use latest devices for production and marketing of goods. Change is the essence of business.
8. The success of an enterprise will depend upon the efficiency of its management. The task of management is to plan, organize, coordinate and direct various activities for achieving business objectives.