Consequences of successful business vs unsuccessful business: Linking business success to management
The success of a business is based on the quality, the education and the experience of management. Experience is necessary in order to make the right decisions and education leads to higher quality of performance. Quality decisions and performances contribute to the achievement of the business objectives and goals. All these success factors enhance the strengths of the business, which makes it more competitive in the marketplace.
Let’s have a look at two similar businesses, a successful one, KFC, and an unsuccessful one, Mochachos’ Chicken Villages and we can see how applying quality relates to some business functions.
1. Business Image or Public Relations Function
The main objective of the PR function is to present a good impression of the business because customers associate the business image with the product.
So the KFC chicken with the secret recipe is what the customers see as the company. If they are happy with the chicken they are happy with the company, KFC as a whole. KFC is a large business with lots of money to spend on the appearance of the stores, advertising, presentation of meals like the boxes etc and even dressing their staff is nice eye catching uniforms. Another good PR method is direct contact where staff members come into contact with orphanages, hospitals and schools. KFC makes sure that the media are informed so that they receive publicity about their good deeds.
Mochachos’ Chicken Villages on the other hand didn’t have a lot of money at their disposal for image which put them at a disadvantage. Because Mochachos Chicken Villages didn’t have the look of a well established company with large corporate offices, big expensive advertising, and the customers associated that with their ability to provide good food. They did nothing in the community and got bad publicity when things started to go wrong at the stores.
2. Product Quality and Operations Function
Improvement in quality is achieved with the advancing in manufacturing technology. The company has to keep up with the times and do constant reassess of future production requirements
KFC are always bringing out new kinds of chicken for us to eat. There are strips, pops, burgers and even boneless chicken. They are improving their technology all the time. An example is the grilled KFC chicken you get today. They have realized that customers are also trying to eat a little healthier and they have developed new technology to grill the chicken instead of frying it but always keeping the quality high.
Mochachos’ Chicken Villages have stuck to one or a few products. Not bringing in anything new or keeping up with the latest on the market. And this could lead to a lack of interest from the public and eventually bad quality of the food.
3. Quality Human Resources Function
Appoint employees that have the abilities and experience to obtain results.
KFC have the resources to spend time and money on training the staff as well as training the managers. They have the money to pay the employees what they are worth. Happy workers equal more productive workers. They hire the correct people for the job and outsource certain required services such as IT specialists to keep their till systems working properly. Organisation and leadership are also a successful part of the KFC staff.
Mochachos’ Chicken Villages have perhaps cut costs and employed inexperienced staff that don’t have the abilities to provide a good service to the customers therefore making it more difficult to get the results they wanted. The management haven’t been trained properly and that reflects on the company as a whole.
4. Quality Administration Function
Administration is spread throughout the entire company and this need s to be of the highest quality for all systems to work and eventually for the management to make the correct decisions.
KFC have the correct systems in place from their production lines to the delivery of good to the systems in the stores. All documentation is done correctly and all systems are in place and check. Policies and procedures are followed to the last detail such as the cleaners noting down the time they have cleaned. Stock control is an ongoing process. All the information collected is used for research and development, planning, projecting and budgeting ahead and also steps are taken to make sure the right decisions are made for the goals of KFC to be achieved.
Mochachos’ Chicken Villages didn’t have all the policies and procedures in place. They made incorrect decisions regarding renting new space to operate in. They didn’t analyse their customer’s needs, they didn’t project future sales or work out the financial position of the business. The most important thing is that Mochachos’ Chicken Villages didn’t remain sustainable in today’s competitive business world.
5. Quality and Healthy Financial Function
This function is concern with raising enough capital to finance the business’s assets, resources and services to operate properly. The financial manager must make sure that the business can make enough money to cover the cost of raising the capital.
KFC have done budgeting which is the most important mechanism for financial control. KFC have many stores and many investors, properties and equipment which all forms part of making the business financially stable.
Mochachos’ Chicken Villages didn’t have enough investors buying into the franchising concept and then the expenses eventually became more than the income, this showing a lack of financial planning, budgeting and control. They had no investors and that meant no security that the business would remain sustainable or too much of the owners capital was required.
In conclusion: Good managers will ensure successful business results because it will ensure that customer needs are satisfied. As the saying goes “Good managers are trained, not born.” Hardly anyone is born a good manager. Almost all of them have learnt it. And the good thing is that it can be learnt. Plenty have done it. And so can you. Learning to be an excellent manager requires education, training and experience. You can’t skimp on any one of them…..it takes all three.