The number of employees and either turnover or balance sheet total are the factors that determine whether the company is an SME or not.
Learnt about Mintzberg's organisational structure and simple structure.
The four basic steps for a small business to systemisation are :
1. Flowchart each process in the business
2. Document how it gets done
3. Measure using key performance indicators
4. Allow the system to change/grow
Key systems for small businesses:
Lead generation - Marketing
Lead conversion - Selling
Client Fulfillment - delivering value
Objectives of systemisation in small business:
Reduces risk by enabling the employees to perform a range of processes by following set procedures
Enables work to be allocated to the lowest possible cost source
Allows measurement and improvement of the business processes
Frees up the owner in procuring new business
Allows the owner to be away from business once processes are set and followed
Paves the way to being the business of value that can be sold
Paves the way for using the more complex information systems that will improve management information allowing greater control on the business
Use of information systems in micro business:
Micro businesses in their first year will make limited use of systems, concentrating on demand creation: Website, Google analytics, Facebook, twitter etc.
They need to manage their finances using softwares like spreadsheet or kashflow(cloud based system)
The Information systems will be implemented out of box with no concern for the associated processes
The owner faces a crisis for being overworked; working in the business rather than working on the business. This leads to a need to implement business processes.
Mature Micro Business:
A mature micro business will have an accounting software that enables them to keep a track of financial performance of the company
With less than 10 employees communication will be easy although managing leads, prospects, sales and customers maybe increasingly complex, so the business should look for a Customer Relationship Management software.
Also, the potential use of ERP system may also occur
When we grow from a Micro business to Small business:
Sharing of information becomes very important
The increasing size of the organization leads to more complex buying decisions
Do we go for a best software or take an integrated software solution from SAP, Microsoft or other vendor
Do we hire consultants or do we look for supplier who will provide end to end service.
Learnt about Mintzberg's organisational structure and simple structure.
The four basic steps for a small business to systemisation are :
1. Flowchart each process in the business
2. Document how it gets done
3. Measure using key performance indicators
4. Allow the system to change/grow
Key systems for small businesses:
Lead generation - Marketing
Lead conversion - Selling
Client Fulfillment - delivering value
Objectives of systemisation in small business:
Reduces risk by enabling the employees to perform a range of processes by following set procedures
Enables work to be allocated to the lowest possible cost source
Allows measurement and improvement of the business processes
Frees up the owner in procuring new business
Allows the owner to be away from business once processes are set and followed
Paves the way to being the business of value that can be sold
Paves the way for using the more complex information systems that will improve management information allowing greater control on the business
Use of information systems in micro business:
Micro businesses in their first year will make limited use of systems, concentrating on demand creation: Website, Google analytics, Facebook, twitter etc.
They need to manage their finances using softwares like spreadsheet or kashflow(cloud based system)
The Information systems will be implemented out of box with no concern for the associated processes
The owner faces a crisis for being overworked; working in the business rather than working on the business. This leads to a need to implement business processes.
Mature Micro Business:
A mature micro business will have an accounting software that enables them to keep a track of financial performance of the company
With less than 10 employees communication will be easy although managing leads, prospects, sales and customers maybe increasingly complex, so the business should look for a Customer Relationship Management software.
Also, the potential use of ERP system may also occur
When we grow from a Micro business to Small business:
Sharing of information becomes very important
The increasing size of the organization leads to more complex buying decisions
Do we go for a best software or take an integrated software solution from SAP, Microsoft or other vendor
Do we hire consultants or do we look for supplier who will provide end to end service.
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