Processes are the pillars of a business.
But when it comes to daily business operations, there are several levels of systems that work together to generate revenue, both on a micro and macro level. These activities ensure that a business makes products that serve customer satisfaction, pay expenses, and maintain profits.
Business leaders use technology like revenue operations and intelligence software to analyze the different touchpoints in a buyer’s journey. These insights determine the wins and losses in customer interaction, resulting in improved business operations that bring success.
What are business operations?
Business operations comprise a range of daily tasks a business performs to remain profitable. While these tasks can vary according to the business type or industry, they typically include marketing, sales, finance, and manufacturing. By improving business operations, companies reduce costs and encourage innovation.
While operations in business might be influenced by external factors like the state of the market, there are several internal moving parts to consider. These systems determine a company’s competency in developing products and services.
As a business grows, its operations also need adjustments. Practices like business process modeling and business process management (BPM) allow companies to accommodate all such modifications and ensure efficiency in daily processes. Failing to plan ahead and modify will result in operational inefficiencies that can bring catastrophic losses.
Key components of business operations
From managing employee communication to ensuring compliance with key company policies and variables, it’s hard to fit all the roles of business operations under a single umbrella.
These five components of business operations show how wide-ranging and essential effective processes are for a company.
Assigning roles and responsibilities
A role in business operations is like playing point guard on a basketball court. Business operations specialists delegate and distribute roles and responsibilities to other members of their team. When hiring new employees, it becomes clear that each candidate has a different skill set. Business operations encompass selecting suitable candidates and ensuring their individual roles within the company best suit their strengths.
It's one thing to have a company with top-tier talent. However, it's another to ensure that this talent fits into roles that maximize their ability to excel. Business operations are the funnel through which roles and responsibilities are delegated to the right employees for the jobs.
Handling internal communication
While the assignment of these roles and responsibilities may be specialized and distinct, business operations also include ensuring that specialization doesn't compromise any qualities of a company's ability to function as a unit.
A pivotal aspect of any company's ability to function is how its employees communicate internally, from the c-suite to its sales team and interns. Business operations facilitate this communication and, in turn, build a community for a company's employees.
Maintaining effective relationships with coworkers is essential to a business where many individuals function as a unit. From using internal communication software to email management solutions, business operations promote effective conversation within a company to produce a positive result.
Managing resources
In addition to delegating roles and responsibilities within a company, business operations are also concerned with smartly managing a company's resources. A business must maintain the proper equipment inventory to function successfully and efficiently.
Business operations are concerned with finding an appropriate balance of cost and technology to deliver the best performance. Performance, in this case, is both in producing a product and making money. A business can have great engineers, product managers, and salespeople but can only function well with a well-constructed business operations plan.
Roadmapping a plan
Business operations are the foundations through which a company executes all the necessary actions to operate successfully. Companies can only work successfully by roadmapping a business plan.
A business roadmap is an essential element that visualizes specific aspects of a business plan in a defined time frame. It enables companies to find the most practical use for their talent and supports successful workers in creating a successful business.
Ensuring compliance
Business operations ensure that employees comply with a company's fundamental guidelines and values. When a business is in the thick of operating, and there are moving parts left and right, compliance with specific regulations, such as an expense reimbursement policy or upholding cultural values, can be hard to track.
By improving business operations, a company can implement such guidelines sustainably for employees.
Types of business operations
For a company to run successfully, the different business operations must be planned and executed efficiently. These include:
- Production involves the creation of goods and services for customers.
- Finance applies to managing the company’s resources, investments, and taxes.
- Administration includes overseeing the day-to-day activities around the office.
- Sales & Marketing comprises the promotion and selling of products and services.
- Human resources concerns managing the people in a business.
- Customer service ensures addressing the needs and queries of customers
How to improve business operations
Business strategies are not set in stone. So, making vital improvements to your daily operations is crucial to remain competitive in the industry.
Define and monitor performance metrics
Before making any efforts toward improving business processes, it's essential to identify where you currently stand. Leaders must define and analyze key performance indicators (KPIs) and benchmarks to assess business operations. These metrics will vary depending on each process and help identify improvement areas.
Improve existing processes
Once you know the problem areas in your business operations, you can focus on making the necessary changes. This includes improving existing processes by streamlining or automating workflows for increased productivity. You can also identify if there is a need to hire newer staff members with better skill sets.
Use business intelligence
When a business leverages its data correctly, it can result in enhanced business intelligence, improving daily operations. Companies focused on digital transformation use business intelligence software to visualize data and make informed decisions. This practice also delivers insights that support new processes across the board.
Follow industry trends
One of the most effective ways to stay competitive is to be adaptive to new trends. Trends can come in the form of technology, laws, buying patterns, or any combination of economic changes. Staying in tune with the latest industry trends will empower you to rise above the competition and cut costs with innovation.
$26.18 billion
is the projected global market value of business process management by 2028.
Source: Fortune Business Insights
Business operations examples
Depending on the market, business operations can be unique to your audience's needs and vary from others. So, understanding your industry is the first step in achieving long-term success.
Here are some common examples of business operations across different industries:
Technology
Business operations in the technology industry comprise the development, maintenance, and management of IT infrastructure and systems. Businesses must hire and train the right people to execute these tasks and perfect their skill sets. It also involves using different task management software to monitor and fix issues immediately in case of deviations.
Manufacturing
Manufacturing is all about converting raw materials into finished goods. One of the most essential things for manufacturing companies is to source their raw materials from credible sources. The business should also look into how these materials are stored, processed, and shipped.
Retail
The retail industry focuses on maintaining the inventory of goods for customers at a price they are willing to pay. Preserving an efficient inventory allows businesses to avoid dead stock instances and maximize revenue. Negotiating with suppliers is also essential for retail companies to buy items on credit and always have fast-moving products in stock.
Aim for progress, not perfection.
Every business practices a set of daily tasks that are vital for survival, growth, and overall success. Being relentless about learning, growing, and improving these processes will set you apart.
As roles become increasingly specialized within a company, there needs to be a strong backbone of company values and management of business activities that remains constant. Because when aiming for progress, the smallest adjustments can create the biggest difference.
Wondering how to optimize your production and manufacturing operations? Read this guide on operations management to create a unique strategy that benefits your target customers.
This article was originally published in 2019. The content has been updated with new information.
