Enterprise Risk Management and the PMBOK

Enterprise Risk Management is a term used to describe a holistic approach to managing the risks and opportunities that the organization must manage intelligently in order to create maximum value for their shareholders. The foundation for the approach is the alignment of the organization's management of risks and opportunities to their goals and objectives. One of the keys to this alignment is the "Risk Appetite" statement which is a statement encapsulating the direction the Board gives management to guide their risk management methods. The statement should describe in general terms what kinds of risk the organization can tolerate and which it can't. This statement plus the organization's goals and objectives guides management in the selection of projects the organization undertakes. The statement also guides management in setting risk tolerance levels and determining which risks are acceptable and which must be mitigated.

This article will attempt to review Enterprise Risk Management (ERM) and relate it to the best project management practices found in the PMBOK® (4th Edition). The source for most of my information about ERM comes from a study published by the Committee of Sponsoring Organizations (COSO) of the Treadway commission published in 2004. The Treadway commission was sponsored by the American Institute of Certified Public Accountants (AICPA) and the COSO consisted of representatives from 5 different accounting oversight groups as well as North Carolina State University, E.I. Dupont, Motorola, American Express, Protective Life Corporation, Community Trust Bancorp, and Brigham Young University. The study was authored by PriceWaterhouseCoopers. The reason for listing the oversight committee and authors is to demonstrate the influence the insurance and financial industries had over the study.

Enterprise

The approach suggested by the study, which is probably the most authoritative source of ERM information, is very similar to approaches taken to managing quality in the organization in that it places emphasis on the responsibility of senior management to support ERM efforts and provide guidance. The difference here is that, while Quality methodologies such as CMM or CMMI place the responsibility on management to formulate and implement quality policies, ERM takes responsibility right to the top: the Board of Directors.

Enterprise Risk Management and the PMBOK

Let's go through the study recommendations and relate them to the processes recommended in the PMBOK. To refresh your memories, those processes are:

• Plan Risk Management
• Identify Risks
• Perform Qualitative Risk Analysis
• Perform Quantitative Risk Analysis
• Plan Risk Response
• Monitor and Control Risks

ERM begins by segregating goals and objectives into 4 groups: strategic, operations, reporting, and compliance. For the purposes of managing projects, we need not concern ourselves with operational risks. Our projects might support implementation of reports and our projects may be constrained by the need to comply with organizational or governmental guidelines, standards, or policies. Projects in the construction industry will be constrained by the need to comply with the relevant safety laws enforced in their location. Projects in the financial, oil & gas, defense, and pharmaceutical industries will also be required to comply with government laws and standards. Even software development projects may be required to comply with standards adopted by the organization, for example quality standards. Projects are a key means of implementing strategic goals so goals in this group are usually applicable to our projects.

The study recommends 7 components:

• Internal environment The key component of the internal environment is the "Risk Appetite" statement from the Board. The environment also encompasses the attitudes of the organization, its ethical values, and the environment in which they operate.
  PMBOK® Alignment The description in the study is actually very close to the description of Enterprise Environmental Factors. Enterprise Environmental Factors are an input to the Plan Risk Management process. The PMBOK also refers to the organization's risk appetite in their description of Enterprise Environmental Factors, as well as attitudes towards risk.
  
• Objective Setting Management is responsible for setting objectives that support the organization's mission, goals, and objectives. Objective setting at this level must also be consistent with the organization's risk appetite. The objective setting here may refer to objective setting for the project, as well as any of the other 4 groups.
  PMBOK® Alignment Goals and objectives should include those that pertain to risk management. The project's Cost and Schedule Management plans are input to the Plan Risk Management process. These documents should contain descriptions of the goals and objectives in these individual areas. These goals and objectives may determine how risks are categorized (Identify Risks), prioritized (Perform Qualitative Risk Analysis), and responded to (Plan Risk Response).
  
• Event Identification Events that pose a threat to the organization's goals and objectives are identified, as well as events that present the organization with an opportunity of achieving its goals and activities (or unidentified goals and objectives). Opportunities are channeled back to the organization's strategy or objective setting processes.
  PMBOK® Alignment This component aligns exactly with the Identify Risks process from the PMBOK. The only significant difference here is the recommendation that opportunities be channeled back to the organization's strategy of objective setting processes. The PMBOK offers no guidance here but this component can be supported by simply referring any opportunity not identified with an existing project goal or objective back, to the project sponsor.
  
• Risk Assessment Risks are scored using a probability and impact scoring system. Risks are assessed on an "inherent and residual" basis. This simply means that once a risk mitigation strategy has been defined, its effectiveness is measured by determining a probability impact score with the risk mitigation strategy in place. This score is referred to as residual risk.
  PMBOK® Alignment This component aligns closely with the Perform Qualitative Risk Analysis process. This process provides for the probability and impact scoring for the identified risks. The Monitor and Control Risks process also supports this component. This is the process that measures the effectiveness of the mitigation strategies. This is the process that will determine the residual risks.
  
• Control Activities Policies and Procedures are established to ensure that risk responses are effectively carried out.
  PMBOK® Alignment This component is supported by the Plan Risk Management process. The output of this process is the Risk Management Plan which describes the risk management procedures the project will follow. Keep in mind that Control Activities is wider in scope than Plan Risk Management, the Plan will only cover those procedures that pertain to the project. The Monitor and Control Risks process also supports this component. This process ensures that the procedures defined in the plan are carried out and are effective.
  
• Information and Communication This component describes how information pertaining to risks and risk management is identified, captured, and communicated throughout the organization.
  PMBOK® Alignment This component is actually supported by the processes in the Communications Management knowledge area. The processes in this area manage all project communications. The Risk Management Plan will identify the information, how it is captured, and how it is maintained. The Communications Plan will describe to whom, when, and how the information is to be communicated.
  
• Monitoring Specifies that ERM is monitored and changed when necessary. Monitoring and change are performed in 2 ways: ongoing management activities and audits.
  PMBOK® Alignment Monitor and Control Risks supports this component. This process uses Risk Reassessment, Variance and Trend Analysis, Reserve Analysis, and Status Meetings to monitor risk management activities and ensure that the activities are meeting the project's goals and objectives. This process also describes audits as a technique for determining whether planned activities are being carried out and are effective. One of the outputs of this process is updates to the Risk Management Plan in the case where activities are not effective in controlling risks. Preventive and Corrective actions are also recommended to address cases where activities are not being carried out, or are incorrectly performed.

ERM provides for assurance that it is effective by determining if all 7 components of ERM have been provided for, across all 4 categories of organizational goals and objectives. Project management will not cover off all areas of each component in each category, but will cover those organizational goals and objectives supported by the project and all the reporting and compliance goals and objectives that apply to the project.

Internal Control for ERM is provided for by the guidelines described in the Internal Controls - Integrated Framework document authored by COSO. We won't go into detail describing these guidelines but treat them at a summary level. The ERM study aligns with the guidelines and refers the reader to that document for compliance details. The details of compliance would concern an organization implementing ERM but that must be instigated by the Board and would only concern a project manager if they were to be responsible for a project which implemented ERM. The guidelines place risk controls with other internal controls of the organization (keep in mind these guidelines are insurance and finance-centric). The guidelines provide for the assignment of responsibilities to 3 organizational roles: the Chief Financial Officer, the Chief Information Officer, and the Chief Risk Officer. The Chief Legal Officer is identified in lieu of a Chief Risk officer. The CFO is responsible for monitoring internal control of financial reporting, the CIO is responsible for monitoring internal control over information systems, and the CRO is responsible for monitoring internal control over compliance with laws, standards, and regulations. The guidelines re-iterate that risk management tone is set from the top of the organization as evidenced by the company officers responsible for monitoring.

The Internal Control - Integrated Framework guidelines also acknowledge that monitoring and control are prone to human error and that not all procedures have equal importance. They address this by the identification of the most critical procedures using "key-control analysis". Key-control analysis is used to determine whether control procedures and processes are effective. The guidelines also attempt to provide direction in the identification of preventive or corrective actions to improve internal controls. They do this by evaluation of the information measuring the effectiveness. Only if the information is "persuasive" should corrections be made. The guidelines provide for internal audits of internal control procedures but acknowledge that every organization may not be large enough to warrant that role and that there is a place for external audits in internal controls.

Most of the reporting the project manager will be responsible for will be what the guidelines term as "internal", that is the reports will only be read by management. In some cases reports may be read by 3rd party external organizations. The project manager's reportage on risk management on their project may form a part of the information reported externally, but the project manager should not be made responsible for reporting externally.

The guidelines require that implementation of a framework be scaled to suit the size and complexity of the organization it serves. Scalability will require the organization to identify who will be responsible for a given activity. For example, the organization may not have a Chief Risk Officer in which case some other role must be identified for compliance responsibility. This responsibility will be delegated to the project manager when any compliance objectives form part of the project's objectives.

ERM was designed to serve the Financial and Insurance industries and some aspects are specific to those industries. Some, indeed most, of the components will serve any industry very well. Remember that there were contributors to the study from Universities, electronics (Motorola), and chemicals (E.I. Dupont). The best project management practices described in the PMBOK® will support ERM very well with little alteration. The trick is to identify the project risk management activities which align with and support ERM. Once you do this, implementing ERM with your project becomes easy.

Enterprise Risk Management and the PMBOK

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The Benefits Of Business Management Courses

There are many business management courses offered today. Studying business management is a great way to give yourself an edge when it comes to marketing your business, and making sure that you stay afloat. When it comes to business management, it's best to take a series of courses that cover all sorts of things -- not just one aspect of business.

There are several options when it comes to these courses. You can take classes on campus or online. There are even some organizations that offer free courses in the form of podcasts and web videos. This is exciting for many people, but the only downfall is that you usually cannot get a degree from a free course.

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Business courses are useful to people with all types of experience in business. You can use them if you're just starting or a business, or if you have some experience running business, and want to brush up on strategies.

When you choose to take business courses online, you have the ability to watch lecture podcasts at any time of day that you want. You can work a day job, and then you can view videos and complete your homework at night, and on weekends.

It is a good idea to take courses like this even if you are experienced in the business world. Times change constantly, and you want to keep up to date when it comes to changes in the business world, and the marketing industry. For instance, look at how social media dictates business these days. If you don't keep yourself up to date on the changing times, you will be doing yourself a disservice.

When you take standard business management courses, you will find that many subjects are covered. Some management course schedules offer over 70 courses for you to choose from. There is really a wide variety of subjects that you can cover when you choose to study business management.

The Benefits Of Business Management Courses

If you are looking for information to help you choose a Management Course [http://www.managementcourse.com], Stephen Mayberry can help. He writes extensively on management courses, management training, project management and more. Visit [http://www.managementcourse.com] to get all of this information for free.

Organizational Structures In Project Management

One aspect of project management that used to receive quite a bit of attention in the 1950s and 1960s was the project organizational structures. A myriad of new organizational structures have appeared on the scene in the last couple of decades but they still lack many of the desirable qualities in the traditional methods. Ultimately, project management directors seek organizational methods that facilitate teamwork, can maximize the use of limited resources, efficiency and quality in the way a project is completed and how goals and objectives are achieved. This article will examine the three main traditional organizational structures for project management. These three structures are functional organization, project organization and matrix organization.

Functional Organization This structure is by far the oldest of the organizational methods but remains one of the most successful. This method performs best when used for routine work functions and the upholding of quality and work standards. Functional Organization structures assign projects in two different ways. One way involves the project being assigned to a specific functional manager who then coordinates with the other departments for them to each contribute. Alternatively, projects can be shuffled around to different departments where each department manager ensures that their parts of the work have been completed.

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This method does not work very effectively when used in facilitating complex projects. One of the major criticisms of this organizational structure is the lack of built-in employee recognition, measurement and reward for project performance. Similarly, there is very little individual accountability for any project management tasks that need to be performed.

Project Organization Project Organization is a structure that is specifically designed for executing projects. It is specifically tailored to meet the demands of complex projects by isolating unique work and maintaining a strong focus on completing the project. Once the project is completed, this structure disbands. This structure is effective in maintaining dedicated resources throughout the life of the project.

The major criticism of this structure is that it is inefficient in transferring technology and the use of resources. Also, by the time the members actually begin acting as a cohesive team, the project is over and the organization dissolves. Since this project has dedicated resources throughout its life, major inefficiency ensues when there are underutilized employees during certain parts of the project.

Matrix Organization Matrix Organization is a project management structure that evolved from the recognition of inherent flaws in the Functional Organization and Project Organization structures. Created in the 1970s, this structure combined the best components of these two structures. This model functions very well when there are multiple projects being coordinated at once. The functional managers oversee the staffing, training, job assignment and evaluation of the project's personnel. The functional specialists are assigned one or more projects and oversee that these individualized projects' achieve their objectives are completed through maximum resource efficiency.

Despite its recognition and avoidance of the flaws involved in other structure, Matrix Organization still does have some problems of its own. Individual employees report to at least two managers which can often lead to ambiguity and conflict. These problems can be avoided through good communication and solid leadership between managers.

This article simply provided an overview of several project management organizational structures. Functional Organization, Project Organization and Matrix Organization are the three most traditional project management structures that are still used today because of their effectiveness. However, do keep in mind that there are plenty of other methods available that may better suit your firm's situation. Nevertheless, the type of organizational structure that should be chosen by your firm depends on the type of project as well as the objectives and goals that it ultimately aims to achieve.

Organizational Structures In Project Management

Michael Russell

Your Independent guide to Project Management

Business Management - Guideline to Effective and Efficient Management

Every transaction or activity carried out by a business is commonly done within the scope of the frame-work laid out by the management. Therefore any activity done outside this is counter productive and will not promote the objectives of the organization.

A manager should set the targets to be achieved by the employees. Objectives should be clearly stated, measurable, prioritized and timed. A good manager constantly checks weather these targets are being achieved and takes corrective measures when called upon. He should be able to predict any impossibility and act beforehand.

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When it comes to purchasing, it should be made from the cheapest source not forgetting to check on quality of the products. Apart from that, sales increasing policies such as displays and advertising budget should be affordable. A sales manager must also set reasonable prices and not exploit customers.

Lack of records can easily bring down a business; record keeping helps in detecting problems in advance. Updating records constantly will help run a business in an organized manner thus improving efficiency.

Apart from being given instructions, staffs also need to be motivated. Good supervision will lower operating costs by reducing the number of errors made while increase quality of work.

In any organization, the secret to getting the most out of workers is by boosting their morale. Once the employees are motivated, they will work hard towards achieving the company's set objectives and thus ensure the success of the business. Some of the ways of motivating workers would include periodic salary increments, rewarding best performing employees, organizing team building activities just to mention a few.

Business Management - Guideline to Effective and Efficient Management

Belsheba is a business management expert. She researches and studies on big and small business organizational strategies. Website: Business Management Solutions [http://moneymakingsecret07.blogspot.com] for efficient business operation.

Traditional Japanese Business Management Systems

The prevailing image of the Japanese management system in very large companies is very similar, if not the same as the management system used in small Japanese companies, because business management systems are, after all, a product of their particular national culture.

This article will at first provide a brief overview of the history of Japanese business and management systems over the course of the late 20th century in order to provide a context in which to base its argument. It is, of course, also important to understand what the prevailing image of the Japanese management system is, and how it came to be so dominant or influential with very large Japanese companies.

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This article will also examine how the prevailing image of Japanese management systems in very large companies are similar to and different from the systems of small companies in Japan. There are some key similarities and differences with each general type of management system, and although there isn't enough space in this essay to introduce all aspects, a general overview and some examples of the similarities and differences between the management systems of both very large and small companies of Japan will be provided.

It is important to first understand how the modern Japanese economy became what it is today. Since the end of World War 2, until about the 1970's, Japan had experienced a profound economic transformation. By the 1980's, Japan had become the second largest economy in the world, to the envy and admiration of other nations. This remarkable period of economic prosperity during the latter half of the 20th century has become known as the Japanese 'Economic Miracle'.

There are a range of arguments made by scholars who have attempted to explain the reason behind Japan's economic success in the late 20th century, and these vary considerably. One of these reasons is that Japan's economic success has been solely as a result of the culture and traditions of Japan. This argument is based on the assumption that culture is the main contributing factor of a nation's economy. Morishima has emphasized that in the context of Japan's economic success, the Confucian tradition of Japan has played a key role, arguing that "religious and ethical systems shape human economic behavior and consequently the nature and performance of their economies". Other ideas have been used to understand Japan's rise to success in the late 20th century such as market regulation, for example, Japan's response to market signals, bureaucratic regulation by selecting and fostering strategic industries and political, economic and social conditions in Japan.

Japan's successful economy started to decline in 1973 during the oil crisis, when the price of oil quadrupled, acting as a catalyst for economic failure in Japan. Effectively, the high price of oil had negative effects on the Japanese manufacturing industry. Japan responded by focusing its attention from energy dependent industry to a more knowledge-based industry, thus averting the crisis from worsening, and enhancing the health of its economy. Japan experienced a 'bubble economy' in the years 1987 - 90. This had come about as the result of asset prices rising far beyond their actual value, particularly those of land and shares. Land prices fell sharply in 1990 when the Bank of Japan increased the official interest rate, thus triggering a massive sell-off of shares. Since this time Japan has faced challenges such as an aging population and the currency crisis in Asia, but has recovered considerably and today still has a strong economy, rivaled by only the United States, China and the European Union.

Almost every business policy that the Japanese are well-known for is as a result of the post-World War 2 economic reconstruction in Japan. The first root factor of the modern Japanese management system is a sense of national identity. This is mainly due to the fact that Japan is an isolated, island nation. Actually, this sense of national identity has existed since feudal times in Japan. The second factor of the modern Japanese management system is the notion of Confucianism; while imported from China long ago, the Japanese have their own version of Confucianism, which is central to understanding the modern Japanese management system. Confucianism in Japan has three main aspects; loyalty, filial piety and respect for learning. Loyalty and filial piety in Japan are reflected in Japanese management with honne and tatemae, or one's own feelings and one's public stance, which may and often differ between each other according to the individual.

Loyalty is also seen in very large companies in Japan, where on graduating from high school or university and entering into employment with a Japanese company, one will usually gain 'lifetime employment' with his or her company, thus reflecting the Confucian aspect of loyalty. In this sense, Confucianism plays a major role with Japanese management practices.

Group orientation, or shudanshugi also plays an important role in modern Japanese business management practices. This is also a prominent attribute in Japanese society, for example to see a group of Japanese tourists in a foreign country, one will notice that the people in the group will always stay close together. This aspect of Japanese culture is of course also very apparent within Japanese companies, and has been deeply ingrained into Japanese society itself since the Tokugawa period. Shudanshugi can be seen with almost any social aspect of Japan, thus it is evident with both large and small Japanese companies.

Although this desire to be part of a group may be also apparent with other countries, Japan in particular sees this group mentality as natural, not an exterior phenomenon as it may be seen with other cultures. Individual responsibility is not important in Japan, as it is in the West. Instead, groups are given the responsibilitie. This is another example of the group-orientated ethics of Japan and the Japanese workforce.

There are also two types of attitudes towards authority in Japan: kengen and ken'i, or simply, formal authority and personal influence. As such, Japanese companies both small and very large tend to be run on ken'i, personal influence, which is different from a general Western perspective, where emphasis is usually placed on delegated authority.

The fourth important aspect of Japanese business culture is based on regional competition, something that has existed in Japan since feudal times. This is not so much an artificial construction of modern Japan, but something that has been rooted in Japanese culture for a long time. For one example, the competition between firms in Japan in the kantou and kansai regions in modern times reflects the regional competition between these same areas as far back as the beginnings of the Tokugawa period. This cultural aspect of modern Japan is probably reflected more visibly in the business management systems more often with very large companies, than smaller companies in Japan.

There are two basic forms of obligation in Japanese society, which can be seen in the business culture of Japan. On refers to a debt that is not able to be repaid, for example one's debt to their parents or the debt incurred from saving another's life. While it cannot be repaid, one will try to repay it. This type of obligation is also apparent with entering into lifetime employment with a very large Japanese company, and is tied in with the Confucian notion of loyalty. The second form of obligation, giri, is incurred from receiving a favour, such as leasing an apartment to a tenant.

Along with the aforementioned aspects of Japanese culture, there are many more aspects present with Japanese culture, and along with it the Japanese management systems of both small and very large companies. In simple terms, Japanese business management styles are a by-product of the Japanese national culture, as such, each type of management system is not much far removed from the other. In fact, we see such cultural aspects in almost any facet of society in Japan.

It is immediately apparent that culture influences business practices and in effect business management systems. Entire theses have been written around this idea. One such example is Kahn's 'Confucian Economic System', used to describe Japan, Hong Kong, Taiwan, Singapore and Korea's cultural links to business practices. Kahn describes the features of these 'neo-Confucian' economies to be related to a number of factors, including sobriety, a high value for education, a desire to succeed, seriousness about life and a hard-working ethic. Along with a culturally ingrained, Confucian sense of loyalty, there is also a sense of harmony in the Japanese workplace, as there are with the group-oriented mindset of Japanese society. This is evidenced by strike-free workplaces in modern Japan, thus placing an emphasis on co-operation and mutual obligation, rather than equality.

The cultural values, relations and structure of modern Japan clearly affect how Japanese society operates, and this is also the case with modern Japanese business management systems in both very large and smaller Japanese companies, as has been proven in this essay. Japan is a very unique country, in that its culture does not completely resemble that of any other one nation, although Japan has borrowed much from other countries to construct its own national identity.

It is apparent that Confucianism plays an important role in Japanese culture and in effect its society, business practices and so on. What has been covered in this essay is only a brief glimpse of the complicated and detailed Japanese business management world, including such cultural aspects as group orientation, authority, regional competition, obligations, and overall, the Confucian-based business culture of Japan, which in itself has many important aspects which are used in Japanese social practices and business management systems alike.

The reason why the prevailing image of Japanese management systems in very large companies and small companies is very similar, if not the same, is because the Japanese economy, and with it the business structure of virtually any kind of business or large company in Japan is directly influenced by Japanese cultural values, relations and structure, in particular, those of Confucian origin.

Many scholars have argued about the reason why Japan has become so successful in the late 20th century, in an attempt to describe the Japanese 'Economic Miracle'. The first argument that is usually presented is that Japan's recent economic success is as a result of her culture and tradition. While it has not been proven beyond doubt that this is the only reason behind the 'Economic Miracle', it is certainly a compelling argument and clearly demonstrates the powerful influence that culture has over the structure of a national society such as Japan.

Traditional Japanese Business Management Systems

Luthor Laine is a former scholar and professional Japanese/English Translator. You can reach him at [http://www.rusasan.com/]

Top Ten Tips About People Management

To get the best results you have to be very good at Managing People...and it's not as hard as you might think. Here are the secrets of the very best managers:-

The best at Managing People...

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1. Manage! They focus on getting their people to deliver the key activities and don't attempt do too much themselves. The best managers delegate widely, using the ethic 'Ask for forgiveness, not for permission' to free their people from blame or wrongdoing.
2. Build the Best Teams Leveraging the exceptional talents of all the people around them, managers develop and utilise capability fully - and glue it together.
3. Focus on Delivery Managers are there to deliver the day to day tactical results the business or organisation needs. Here, there is little space for strategy or vision as such, but those great at managing peoplewill keep a reference point there. Every manager's defined goal is measurable results.
4. Build Relationships As it's all about people, great managers build relationships easily and make it a priority, day-in-day out. They spend a lot of time with and listening to, their people.
5. Accept Feedback Actually, they don't just accept it, they suck feedback in - they use their excellent listening skills to seek out feedback all the time - in every interaction.
6. Develop Others Grasping the opportunities, the best managers quickly link them to those who can make progress in their own development - and in line with ongoing Succession Planning, prepare for the future well in advance.
7. Are Accountable They are very clear that they are 'where the buck stops'. No blame elsewhere, not upwards deflection of decisions; no 'someone else's fault'. They are where the action is and they accept it. It's down to them.
8. Set Standards To ensure that everyone is clear, great managers have simple and clear standards throughout their area of operation - ideally created in collaboration with their people.
9. Are Determined Focusing entirely on value-creation, they stick to plans, policies and change programmes like glue. They have a skill to know and deliver what is right, without veering from their Vision.
10. Can Be Trusted The best managers are ethically sound, fair and honest. They make promises only when they know they can deliver. Everyone is treated equally and their own behaviour models fairness and transparency.

Simple steps, using them can make 90% of your management very, very effective. Checkout the website for key information in 40 different people skills to develop your management skills fast!

Top Ten Tips About People Management

(c) 2008 Martin Haworth is the author of Super Successful Manager!, an easy to use, step-by-step weekly development program for managers of EVERY skill level. You can get a sample lesson for free at http://www.SuperSuccessfulManager.com

Business Management - What Are The Good Traits

To start a business and have it up and running successfully, you will need to think of some realistic business management plans. With these plans and your dream in mind, you will have to work through the initial difficult stages to build up good business management strategies and the ways to achieve them. Your business-management skills may be the crux between mediocrity and success.

The first and most important step in a good business management plan is to set clear specific goals and objectives. It is easier to achieve goals or objectives that are distinctive and focused. In addition, it will take lesser time but produce better results continually. As such, design your strategies to achieve your objectives. It makes good business sense to organize the "to-dos" for each day so that there is better focus on every task.

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Another important business management trait is align your own personal goals and objectives with that of the company's and give them full focus until each task has been completed. The more time you spent on perfecting a skill, the lesser will be the time taken to complete the task.

Another purpose of setting goals and objectives is to create a way to measure performance and track accomplishments. Such goals and objectives have to be challenging but achievable. You need to be creative and innovative in order to achieve the specific goals and strategic objectives set up in the business management plans.

At the same time, create your company's mission and vision statements and find solutions on how to implement or accomplish them. Outline the performance targets and the ways to achieve them. This is to avoid going in different directions. Define the company's passion and the methods to excel in it. Such business management strategies will strengthen the company's competitiveness in the industry. In addition, setting up long-term goals will determine the company's position in ten years' time and mark out the path to achieve them.

Some entrepreneurs may confuse activity with productivity. Most of the entrepreneurs who succeeded have the ability to identify and categorize specific activities that are extremely crucial or create an extraordinary significance that will contribute towards the overall success of the business. More time will then be allocated to ensure that these are carried out thoroughly and effectively. A successful entrepreneur also has an in-build drive that motivates them to persevere and make things happen. This is one of the most important business management traits.

Another business management characteristic is to know how to respond to industry changes and market conditions. A successful entrepreneur will learn through other people's knowledge and efforts especially those of their clients or competitors. Capitalize on these new ideas or concepts and your business may expand with lesser efforts contributed and within a shorter period of time.

Due to continuous changes, good business management is an ongoing process to constantly evaluate strategies and monitor performance to see if there are better ways to accomplish the goals and objectives or whether improvements and adjustments need to be made. This may even lead to changing the company's mission or vision statements.

Business Management - What Are The Good Traits

Ske Chay of www.inventoryanalytics.com [http://www.inventoryanalytics.com] Providing some comprehensive information on business management at www.trade-opportunities.com

Business Management

Business Management characterizes the process of leading and directing all or part of an organization, often a business, through the deployment and manipulation of resources (human, financial, material, intellectual or intangible). Early twentieth-century business management writer Mary Parker Follett defined management as "the art of getting things done through other people."

One can also think of business management functionally as the action of measuring a quantity on a regular basis and of adjusting some initial plan, and as the actions taken to reach one's intended goal. This applies even in situations where planning does not take place. From this perspective, there are several major management functions, namely: planning, organizing, leading, coordinating and controlling.

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Management is known by some as "business administration", although this then excludes management in places outside business, e.g. charities and the public sector. University departments that teach management are nonetheless usually called "business schools". The term "management" may also be used as a collective word, describe the managers of an organization, for example of a corporation.

Today, we find it increasingly difficult to subdivide management into functional categories in this way. More and more processes simultaneously involve several categories. Instead, we tend to think in terms of the various processes, tasks, and objects subject to management.

One consequence is that workplace democracy has become both more common, and more advocated, in some places distributing all management functions among the workers, each of whom takes on a portion of the work. However, these models predate any current political issue, and may be more natural than command hierarchy.

All management is to some degree democratic in that there must be majority support of workers for the management in the long term, or they leave to find other work, or go on strike. Hence management is becoming less based on the conceptualization of classical military command-and-control, and more about facilitation and support of collaborative activity, utilizing principles such as those of human interaction management to deal with the complexities of human interaction.

Business Management

Ismael D. Tabije is the Publisher-Editor of http://www.BestManagementArticles.com, a unique niche-topic article directory that features exclusively business and management topics. For a large dose of business management tips, ideas and strategies, see http://business-management.bestmanagementarticles.com.

The Importance of Key Business Performance Indicators to Small Business Management

How do you know how well your small business is doing? Do you look at profit? Do you look at your sales numbers? Do you measure growth?

Most businesses use monthly financial statements, which include sales revenues. Some compare those monthly results to the plan and/or to the previous year's results. All business should continue to use that information to manage their business. However, all small businesses should also include more significant key performance indicators as part of their measurement process. As a small business owner, managing-by-measuring performance is a significant key to your success.

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Develop a set of key performance indicators (KPIs) to track your business growth and success. These measures will keep you focused on your business goals. When you write your business plan make sure that you include measurable goals and objectives. Then set in place a system that will provide you with regular indications of performance.

KPIs can be easily developed and monitored however each business needs to customize the measurement process to their own business needs.

Here are just a few KPIs you can consider for your business:

• Number of orders in a day/week/month/year
• Number of estimates in a day/week/month/year
• What kind of 'win' ratio does your business enjoy (e.g. do you 'win' 15% of all estimates - track this data)?
• How long does it take for you to respond to customer queries: estimate turn-around times; order processing; time from order placement to order delivery; responsiveness in handling customer complaints; and so on?
• How often do you hit your 'promise' date (i.e. the date you promised to deliver the order to your customer)? Analyze the 'misses': ship dates you don't make. Are they with one product line? Or with one customer or type of customer? Or with one employee?
• What kind of employee turn-over rate do you have?
• What kind of customer turn-over rate do you have?
• Percentage of business your largest customer holds?
• Sales by customer
• Sales by customer by product
• Sales by product

These would be in addition to your regular monthly financials but consider KPIs more of a daily or weekly measurement. Set up KPIs to help you see what is going on in your business presently and to help you forecast the near term (this week, this month, next month). If you track some of these statistics daily you will begin to develop trend lines that will highlight both the positives and negatives of your business growth.

Once you start to collect the data, it becomes much easier to see where the problem lies. If you are a manufacturer and you are always late delivering to your largest customer, find out why. Analyze your process. If you are a distributor and you are always late delivering a certain product, find out why. Is your supplier always late? Do you need to carry more inventory of that item? Or in both these examples is it because your employee turn-over is particularly high in the shipping department? Why is turn-over in shipping high? Are you hiring the right people? Are you under-paying? Does your shipping supervisor have weak people skills?

Developing good performance indicators will help you identify and solve issues quickly. Once you have developed KPIs that are aligned with your business goals, and once you track your performance regularly, you will be in a better position to manage your business.

The Importance of Key Business Performance Indicators to Small Business Management

For more small business strategies and other small business resources go to http://www.more-for-small-business.com/ Kris Bovay is the owner of Voice Marketing Inc, a business and marketing services company. Kris has 25 years of experience in leading large, medium and small businesses. Copyright 2008 Voice Marketing Inc.

The Different Types of Management Jobs

What is it about management jobs that people are always aspiring towards? Is it the perks that come with the position, such as an attractive pay package, discounts (where applicable), power of authority, challenging goals to reach etc? Whatever the reasons maybe behind people desiring the role of an authoritarian-type role in any business, it is one thing to desire a role and another to actually fulfil the demands of a manager.

For people keen on taking on management jobs will need to take into consideration the varying roles management positions take on. Take for instance management in the retail industry, this role may be very customer-centred and may require plenty of customer interaction, communication amongst people and of course managing staff so that they reach target sales. However, within the retail industry there are different managerial roles for instance assistance managers, duty managers, deputy area managers, area managers and regional managers. Each role is a step up from the other and requires a lot of retail experience for people to move up in the career ladder.

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Management within the healthcare industry would be different to that of the retail industry. Healthcare management is an extremely demanding job and requires extensive knowledge of everything medical related. Things like hospital management requires the manager to be on top form when managing staff, keeping on top of medical supplies, working within budgets, monitoring hospital care and patient care, dealing with patient issues, dealing with legal issues, administrating hospitals and healthcare networks, and leadership of healthcare professionals. This is just one aspect of healthcare management and could encompass much more than what is stated above.

Other management jobs could be in a standard corporate environment, whereby the role could be to draw up plans, manage projects, reach to target goals, forecast the financial market in the future, scope competitive companies, predict the target market direction, coming up with marketing strategies and more. Depending on the management jobs you are interested in it could take you a matter of months or years to reach to that level.

The key thing to remember is for you to show tenacity, motivation, working to your own initiative, expert knowledge of the field you intend work in and plenty of experience from working within that industry. People tend not to take on a role without having prior experience in the field that they are going to work in, otherwise they will be faced with a big surprise. Some may be able to take on a completely new role and pick things up quickly without any supervision however not everybody are as gifted and talented as this.

The fact remains for a person to work in a managerial role without having worked in the company they are applying for, they will need to present a resume that exhibits many years of experience as well as in-depth knowledge of the industry. Most employers will not take the risk of hiring an inexperienced person unless they impress them so much on the day of the interview and can demonstrate a high level of intelligence!

The Different Types of Management Jobs

Gino Hitshopi is an expert on obtaining management jobs having had experience working as a retail manager. For more information visit http://www.prismrec.co.uk/

Strategic Self Management - Motivation 1 - Recession 0

Throughout history, man has been studying motivational training but to date motivation is still a very complex and misunderstood word. We easily go from an energy state of high motivation to spiraling into a total realm of negativity just based upon the information we receive, whether it is verbal or non-verbal. We can be highly charged and energized one minute and feel flat and deflated the next by this outside stimuli. For example sending out our resumes searching for a job we feel we are perfectly fit to accomplish but upon hearing a negative response or no response we can easily fall into the psychological state of panic.

We can develop thoughts of worry (What if I can't get a job? What if nobody hires me?). We can develop the fear of the unknown (How will I pay my mortgage? How will I care for my children?). Loss of motivation based upon an outside event triggering our raw emotions thus interfering in our ability to move forward.

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Perhaps we have a great business idea only to find looks of disbelief by family and friends who have underrated our talents, skills, and abilities immediately throwing us back into the state of uncertainty and feelings of inadequacies from the discouragement of lack of support. Either way easily influenced by society making it particularly difficult to maintain our self-motivation. Each of us must determine our own level of motivation based upon previous life conditioning and experiences in order for us to remain in control. For this reason alone, we must look inside for what we want for our true selves.

"Know thyself" the Greek Philosophy and "to thine own self be true" are statements that have been around for centuries and are powerful in assisting in reminding us to identify what inner form of spirit we could rely on to develop our life long goals. It is evident nobody can do the work for you so determining your inner yearning is of utmost importance! After all, it is your life, your thoughts, your motive, your reason.

Forms of motivation include working for pay raises, building dream homes, raising a healthy family, working for the good of humankind, investment, self-employment, higher learning, respect, integrity, credibility. The list and reasons for why we do things is endless and requires deep internal processing by each of us in order for us to sustain our drive of personal action.

During the trying times it is critical we protect ourselves from the onslaught of negativity. We must instead force ourselves to focus on identifying what we want, why we want it and what we need to do in order to get there as this is the difference between whether we will increase our energy towards the accomplishment of our deepest desires or not. This is the critical key. It is our desires not others.

The good news is self-motivation is clearly that. It is the self. It is you. It is your thought energy. The only true power you hold in this world is by your thoughts. You are the provider of your perception. It is your responsibility to provide action towards your goals from the motive of reason determined by you. It is your motive for action, which will drive and sustain you through the difficult times in your life. Motivation is merely your thought energy, your reason for being which in turn shifts into physical action.

So how do you self-motivate in times of recession? How do you go on with your dreams and your life when your home is about to be for-closed on, or you find yourself lacking in a job, perhaps your spouse has left or any other major life altering event due to the recession? How do you cope with the additional burden of job responsibility with the cutbacks and having to do two jobs in place of one?

First, you have to come to terms with how you feel about what is occurring. You have to allow your emotions to go through the cycle of healing. If you do not take this vital time at some point later you will find what you suppressed will be expressed in the least opportune time. Go ahead and feel bad now. Try not to struggle with it just feel your emotions.

Take the necessary time to deal with these sentiments. It is okay to be angry, disappointed, scared, depressed, numb, anxious, worried, fearful, or any other emotion you are feeling. It should tell you, you are alive! Give yourself all the time you need to sort through your challenges. The important part is that you work through the emotions yourself so that you come to terms with it and come out with a clearer understanding as to what you really want.

Be vigilant of your surroundings to prevent from being, unduly influenced by others for when we are at a low emotional state, we are at a very high level of sensitivity for influence. We must take care that the choices we make in our lives are truly ours and not for the satisfaction or gratification of others.

Another critical key is to separate yourself from others viewpoints while identifying new strategies for your future. Redefining your own motivation based upon your own individuality. At this stage, if you rely too heavily on the influence of others, you run the risk of living your life as others would see for you instead of living the life pre-determined by you.

Try taking long walks, meditating, or simply sitting with your worries and staring into space. Silence will help you to identify what is truly important to you in your life. It will help you to clear some of the ghosts, which no longer work for you. Sit as quiet as you can until you start to hear the strength of your own internal voice guiding you in a more positive direction.

What you will experience is your real self. You will hear your own words telling you what you really want in your life. Take care to be gentle with yourself and allow yourself the opportunity to explore these ideas. Go ahead and write down anything you feel has value to you. You will soon see a pattern begin to emerge.

Soon you will find one of your ideas will create a spark of excitement in the form of renewed energy within you. Follow this idea and learn as much as you can. Do everything humanly possible to learn everything you can about it. By doing this you are fueling the embers of a fire stirring deep within and suddenly you know what you have to do and why you are doing it.

Once this has occurred you are ready to kick yourself in the butt and start back into life. You will find your focus will attract to you everything you need to accomplish your vision.

I have personally found it extremely helpful to start an exercise program at this point. I find exercise helps to strengthen against attacks of negativity, which can greatly drain the young fresh spiritual ideas you are developing. By implementing a solid exercise program into your life, you increase oxygen to your brain allowing for increased focus, concentration, and stamina for your new founded ideas to take shape.

Add to it vitamins and a nutritional program and you are now ready to run 24/7 inspired with high energy and ready to realize your new dreams. As you take your life back into control, you feel a powerhouse of energy develop within you. This is motivation!

For more information on Time Management and Goal Setting strategies visit: http://www.strategicselfmanagement.com

Good luck and may all your hopes, dreams and wishes be turned into motives for action.

Strategic Self Management - Motivation 1 - Recession 0

Marianne, the owner and founder of Ontario Home Care Assist, works with the elderly to assist them in maintaining their independence in their own homes for as long as possible. For more Senior information and free downloads go to [http://www.OntarioHomeCareAssist.com]

Organizational Management - Management Structure

In this installment of our guide to organizational management we look at management structure...

The process of planning, organizing, and controlling human and other resources in order to meet an organizations goals, is known as management.

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Typically, a company will be set up to include different types of managers, which can include managers with responsibility for a specific department or division of the entity, as well as regional managers who supervise activities in a particular geographic region. The types of management positions will vary in accordance with the size of the business.

Management structure (also known as organizational structure) is the method by which staff, departments, divisions and regions work and interact with one another. There are two main types of such structures, known as flat and hierarchal.

Whats known as a flat management structure promotes a decentralized decision-making process, which increases staff involvement and is achieved by very few or no management layers between front-line workers and the company's leadership.

By elevating the level of responsibility of baseline employees, and by eliminating layers of middle management, comments and feedback reach all personnel involved in decisions more quickly. Since the interaction between workers is more frequent, this management structure generally depends upon a much more personal relationship between workers and managers.

The hierarchal management structure has a set chain-of-command - that is each unit in the organization (except that at the very top) is subordinate to another unit or division. That means that each individual communicates directly with an immediate supervisor or subordinate and does not jump over layers of management to get to the top leader.

The benefit of a hierarchal structure is also its primary limitation in that it will reduce the level of communication that goes directly to the top. The hierarchal configuration, however, is the most prevalent for large corporations, governments, and even organized religions.

Flat management structures will typically only work well in smaller companies, or within smaller defined units of a large organization. Once an entity reaches a certain size, this type of structure will not work as well and could end up having a negative impact on productivity. An organizations complexity can be related to its size and how widely distributed it is geographically, and it is this complexity that governs which management structure is most beneficial to the company.

Organizational Management - Management Structure

Want to know more? Click here to continue reading our guide to organizational management: Organizational Management

How to Improve Management Performance

Managing Performance is the procedure of assessment of progress, of an establishment, towards a sought-after goal. It is the measure, analysis and optimization of resources to render a service to a level that has been agreed upon. It concentrates on the delivery of service.

The initial idea behind performance management is a procedure over which the management merges the individuals, schemes and strategies, to maximise both potency and efficiency to be able to present the preferred outcomes. Plainly put, the statement entails, doing the precise things and doing the things right. That is, an up-and-coming organization should admit one system that integrates leadership, and the other that insists on accomplishing excellent.

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An competent performance management in an establishment can achieve leadership skills that can be elevated alongside mental attitudes, interpersonal skills and behaviors. This is a important aspect of managing performance as it helps in keeping back and holding individuals who embody the basic human capital of the organizations. as they are the ones responsible for the implementation of the primary plans of the business.

It is exceedingly essential for a commercial enterprise to have a strong, performance management. It should be able to engage the systems, individuals and schemes actively, for the successful execution. This should further result in an growth in the gross revenue and a better profitability that would credibly not be reachable, if the procedure was not carried through.

With an active performance management, business concerns will prosper like never before. It is an highly essential process of business management, that is employed by directors of people, as an efficient tool, that is utilised by them to reach the objectives of the establishment.

Performance Management should be able to fulfill the next business concerns objectives: The missing link between Ambitions and results: Now, commercial organizations are progressively aware that it is normally not their strategy but the integrated endeavour and abilities of their employees to accomplish the scheme that makes all the difference to their expanding business. Thus, it becomes the duty of top level managers to fill in the gap between the missing links of aspirations and results, by motivating their employees, over management of their performance.

To grow the potential of an organisation, in order to accomplish its scheme, it is important that the establishment develops and makes the capabilities of its employees. Impressive individuals management is the only key to better the businesses functioning.

The most important purpose of Performance Management is to increase the potency of the employees. This should be done, in order to improve the performance of the commercial enterprise.

Managing Performance is connected with paperwork, challenging conversations and bureaucracy, and is therefore ofttimes put away as a chore no one wants to do. Even So, Performance Management is a operation that involves individuals and managers, that use the operation on a frequent basis, to increase their effectiveness towards the employer's establishment.

How to Improve Management Performance

P Abbey owns and runs http://www.managementperformanceadvice.com/benchmarkingperformance.html

Benchmarking Performance

Functions Of Management

Performance of management is necessarily a subject to its functions. Earlier management was segregated into five functions which were-

o Planning

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o Organizing

o Staffing

o Directing and

o Controlling.

With changing times and increasing business complexities, the functions of management also increased and functions like reporting, co-ordinating, budgeting etc. was identified. Primarily, this step was taken to ensure departmentalization of management functions so that effectiveness and efficiency could be enhanced. However, different management thinkers differ on the numbers of functions. Essentially a creative problem solving methodology, the purpose of management is achieved through these functions. The basic objective of these functions is maximum utilization of resources available at company's disposal so that organization's mission and policies could be achieved in the best possible way.

As we delve deeper in every function, planning is the first function which is basically a logical thinking process that decides what needs to be done in order to achieve organization's goals and objectives. It focuses on the broader perspective of the business as well as taking into consideration, the tactical methods to get the desired results.

Organizing is about setting up and maintaining the internal organizational structure in accordance with objectives mentioned in planning stage. It also involves assigning tasks to various individuals for the larger goal of organization's missions and objectives.

Staffing is the process of choosing right people for organization. It can be associated with human resource management and involves recruitment, hiring, training and compensating the workforce.

Directing is guiding people in the organization through the means of counselling, instructing, motivating and various other modes of communication. It helps in channelizing the activities and conduct of employees so that organizational goals can be accomplished.

Controlling is the sum total of process which ensures all the plans are executed and implemented in the desired way. It also decides about whether some corrective and preventive methods need to be taken. It is meant to ascertain problem areas and remedial measures.
Apart from these, minor functions include reporting, budgeting and co-ordinating which are designed to perform specific functions.

Functions Of Management

MBA in India [http://www.mbainindia.in] and across the world is divided into different categories based on the functional aspect. Some motivational short sayings or inspirational speeches can inspire you to learn the progressive functions of management.

Basic Management Skills - What Makes a Good Manager?

Basic management skills are necessary to run a small business. Some business owners believe that leading vs managing is most important. In reality, you need to be able to both lead and manage.

What makes a good manager? There are definite business management styles and skills to focus on; specifically for small business owners. If you're the owner or manager of a small business, it's important to understand what those basic management skills are and to try to incorporate them into your own behaviors. Why? Because some skills are more successful than others and because some styles will engage your employees, while others will dis-engage them.

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Business management skills such as planning, decision making, problem solving, controlling and directing, and measuring and reporting are needed for the daily operation.

Using their small business plan, effective managers direct the business operation. Communications, benchmarking, tracking and measuring are tactics and strategies that they use to check their direction, to adjust the plan (if necessary), and to move the business forward. Good managers act to achieve the desired results; and they manage people and resources to get where they want to go.

Understanding what makes a good manager, means understanding what motivates employees.  How do you build an environment and culture that encourages employees to participate? How do you increase employee productivity and employee satisfaction; simultaneously? How do you recruit the best talent, and then keep them? How do you train your staff to solve problems, make decisions, and involve others in the process? These are just some of the challenges, and responsibilities, of managing.

As a manager, you need to understand what the common business management styles are (autocratic, paternalistic, democratic, and passive are the most common styles). And you need to understand what your style is, and how that style affects business results.

Four Business Management Styles:

1. Autocratic: The manager makes all the decisions; a "command and control" (militaristic) management style. Focus is on business; doesn't want any personal 'stuff' to get in the way. The benefit is that decisions are made quickly. The cost is in high employee turn-over as employees find this style difficult, and stressful.
2. Paternalistic: The manager makes all decisions (or most of them) but focuses on what's best for employees. The benefit is that employees feel the business is taking care of them. The cost is that employees don't take care of business - they are uninvolved and have little at risk.
3. Democratic: The manager wants input from the whole 'team' and majority rules. Often good decisions are made and employees feel involved in the business (the benefit to this style) but the process is very slow and you can't always make everyone happy.
4. Passive: The manager abdicates responsibility to the employees; and calls it delegation. The benefit is that employees often step forward and learn in this environment. The cost is that the direction is scattered and there can be numerous false starts because there is no real manager.

Managers typically use more than one style, depending on the situation. If brainstorming creative new product ideas is today's focus, then the manager may want to use a democratic or passive style. If a decision about keeping or firing an under-performing employee must be made, the manager may need to use an autocratic or paternalistic style (hopefully not a democratic or passive style).

In most small businesses, the business owner is also the manager and the leader. In your business, make sure that you have a good understanding of your own business management styles, skills and qualities and learn how to control them and use them as necessary.

Basic Management Skills - What Makes a Good Manager?

To understand more about what makes a good manager, or the difference between leading vs managing, it is good to focus on the qualities of an effective manager as compared to the qualities of an effective leader.
Kris Bovay is the owner of Voice Marketing Inc, a business and marketing services company. Kris has 25 years of experience in leading large, medium and small businesses. For more pricing strategies and other small business resources and services go to the more-for-small-business website.
Copyright 2008 - 2009 Voice Marketing Inc.

Role of MIS in Business Management

Despite the vast improvements in information technology, computers (on which modern IT is based) cannot as yet take over business management. However, business information systems have transformed the effectiveness, power and efficiency of management.

In an earlier article on business management software, we looked at surface aspects of how modern management information systems help businesses. We saw how computers speeded up and improved the quality of operations. We also mentioned the existence of broad categories of business software - office suites, functional software such as accounting and inventory, and industry software such as retail management software. In this article, we seek to look more analytically at the role of information management systems.

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Decision Support, Problem Analysis and Overall Control

Business managers often need to make decisions that can affect the business' fortunes one way or other. For example, a company with sales outlets or distributors spread over a wide geographic area might want to optimize the logistical operations of delivering merchandise to the outlets. The best solution might be affected by numerous factors such as demand patterns, availability of merchandise, distances involved and the option of using external carriers (who can find two way loads and might prove a lesser cost option over long distances) instead of own vehicles.

While it might be possible to use complex mathematical formulas by hand to compute the best solution, computers transform the whole process into a routine task of feeding certain information as input and obtaining suggestions for best solutions as output. The task can typically be done in a few minutes (instead of hours or even days) and it becomes possible to examine several alternatives before deciding upon one that seems most realistic.

Identifying problems and analyzing the factors that cause them also has been transformed by modern computer information systems. In a typical MIS environment, standard reports are generated in a routine manner comparing actual performance against original estimates. The software that generates the report can be instructed to highlight exceptions, i.e. significant variations between original estimates and actual performance. Managers will thus become aware of problem areas in the daily course of their work simply by looking at the reports they receive, without having to do detailed data collection and computations themselves.

Identifying the factors responsible for the problem can also be routinized to some extent by using such tools as variance analysis. Variance analysis is an element of standard costing system that splits deviations from estimates (or standards) into causative factors such as increase in price of materials used, excessive usage of materials, unexpected machine downtimes, etc. With such a detailed report, managers can delve deeper into the problem factor, such as why there was excessive usage of materials.

Control is also exercised through variance analysis. Budgets are prepared for all business operations by concerned managers working in a coordinated fashion. For example, estimated sales volumes will determine the levels of production; production levels will determine raw material purchases; and so on. With good information system management, it then becomes possible to generate timely reports comparing actual sales, production, raw material deliveries, etc against estimated levels.

The reports will help managers to keep a watch on things and take corrective action quickly. For example, the production manager will become aware of falling sales (or rising sales) of particular products and can prepare to make adjustments in production schedules, and purchasing and inventory managers will become quickly aware of any mounting inventories of unused materials. MIS thus enhances the quality of communication all around and can significantly improve the effectiveness of operations control.

Effective MIS Involves Humans and Computers Working together

The major aspect to note is that MIS provides only the information; it is the responsibility of concerned managers to act on the information. It is the synergy between efficient, accurate and speedy equipment and humans with commonsense, intelligence and judgment that really gives power to MIS.

Role of MIS in Business Management

Gopinathan is a business writer who writes Web content and publicity materials for Web businesses. With first hand business experience as a trained professional with decades of executive and entrepreneurial experience, he can write on business issues with authenticity. And as a trained writer, he can also produce clearly written and readable pieces.

His goal is to help small businesses build their image through written content that brings out their strengths. This goal is sought to be achieved through discussions with clients, and relevant and focused research before starting on the writing. This approach contrasts with that of delivering cookie-cutter articles stuffed with keywords.

He believes that articles should showcase the expertise of his clients in addition to creating links valued by search engines.

Visit his Writing Services website to see how your business can benefit from high-quality writing.