Different Principles, Tools, and Techniques in Creating a Business
Title
Business entities are important to country’s economic growth. It enables to create goods and
services, provide jobs for individuals to generate income and accumulate wealth and generate revenue for
the government which enables to provide basic social services. Moreover, it produces goods and services
that individuals needs and wants.
Business to thrive and grow need to used tools and techniques to continuously exist thus best
practices and techniques need to be employed.
Principles, Tools, and Techniques in Creating a Business
In planning a business, a thorough study needs to be made from the creation of business.
Understanding how the business will operate and co-exists in the business world thus one needs to
study principle, tools and techniques in creating business
Principles in Creating a Business
The principles of a business are the driving forces that make it successful. Below
the ten key principles to make a business a success:
1. Scalability- A business must be scalable for it to be successful. Scalability is the
capability of a company to sustain or improve its performance in terms of
profitability or efficiency when its sales volume increases.
2. Big Ideas- A business is no more effective than the idea upon which it is built.
Business creates its own plan to expand its economic growth.
3. Systems- A business is a system in which all parts contribute to the success or
failure of the whole. In this system, everything must work together from employee
to president; from equipment to resources.
4. Sustainability- A business must be dynamic- able to thrive through all economic
conditions, in all markets, providing meaningful highly differentiated results to all of
its customers. Such differentiation is the key to survival.
[Link]- Growth is essential in business. Without continued growth,
operations will stagnate. This can result in lowered standards of quality for products
or services, decreased customer service, and poor employee morale.
6. Vision- A business must manifest the higher purpose upon which it was seeded,
the vision it was meant to exemplify, the mission it was intended to fulfil.
7. Purpose- A business is the fruit of a Higher Aim in the mind of the person who
conceived it.
8. Autonomy- A business is not part of the owner's life, but is, in fact, its own entity.
9. Profitability- A business is an economic entity, driving an economic reality,
creating an economic certainty for the communities in which it thrives.
10. Standards- A business creates a standard against which all businesses are
measured as either successful, or not.
So, there you have it, the ten principles upon which to conceive, grow, and
expand your business.
Tools in Evaluating a Business
It's the Holy Grail for small business owners – finding ways to make efficiency
savings in all aspects of their operations. The good news is there are plenty of
tools, tips and techniques available to help them make cost savings and boost
productivity. Here are 10 of them.
1. Use technology to speed up workflow- Businesses should be looking to
innovations in technology to solve day-to-day inconveniences and to increasee
efficiency.
2. Shorter meetings fuel efficiency- Hold a brief meeting standing up, every
morning, where each person explains what they are going to work on that day to
ensure everyone is on the right track and not wasting time on non-urgent tasks.
3. Smart office space pays- Office space can involve a big outlay for SMEs, but it
is also an area where some smarter thinking can make a real difference.
4. Advertisement- Advertising keeps your business top of mind so consumers
think of it when they require or need a service or product.
5. Small changes, big savings--One way of improving efficiency is for business
owners to make small changes to the way they handle their company's
expenses.
6. Keep a firm grip on cash flow-"Cash is King not profit”. Ensure the right
management of your inflow and outflow of cash.
7. Stay connected on the move- The growing trend towards mobile and flexible
working means that employees are permanently connected and on the go.
8. Use time more efficiently-Being more efficient is more about being than doing.
It's probably 90% mindset, (Allan, 2013). In addition, “The shorter the amount of
time you allow yourself, the more you will get done”.
9. Get the best deal on insurance- Businesses need insurance because it helps
cover the costs associated with property damage and liability claims.
10. Don't be lax with the legal
In the hectic process of starting up a business, the founders often put off sorting
out the legal matters until later, or not at all.
Since business is a commercial activity and its main purpose is profit, in the book published by the
Development Academy of the Philippines, how to prepare project feasibility studies, it includes an
industry analysis of the following important factors.
COMPETITION AND COMPETITORS
Industry rivalry among companies of the same or related industry is an inevitable part of the
business world of any business size. Intense competition leads to reduced profit potential for
companies in the same industry. Businesses seek constantly competitive advantage.
Competitive Advantage
is what sets your business apart from your competition.
highlights the benefits a customer receives when they do business with you.
It could be your products, service, reputation, or even your location.
Different methods of competitive advantage which it can be done and are classified into
four categories:
c [Link] Leadership-an advantage occurs when business is able to offers same products at
a lower price.
[Link]-Find attributes that is important and set them apart from their
competitors.
[Link] Strategies-used a defensive strategy to distance themselves from
competitors.
[Link]-advantage of seeking strategic alliance with other within related or within
CUSTOMERS
Individuals or companies who desires to possess or make use of products and services.
They play a huge role in the success of your business. Customers likewise can force
down prices, demand higher quality or more service, and play competitors off against each
other—all at the expense of industry profits.
SUPPLIERS
Provide inputs that the firms in an industry need to create the goods and services that
they in turn sell to their buyers. Suppliers can exert bargaining power on participants in
an industry by raising prices or reducing the quality of purchased goods and services.
A business may need one or more suppliers. It is important to develop suppliers who
are reliable in terms of quality of what they supply and their dependability in coming
up with the things you order from them. It is important to maintain good relationships
with one’s suppliers; they are the key to one’s continued access to goods and to raw
materials that will be needed for the business.
SUBSTITUTES
Goods/services that can be used in place for another. These goods may, even if
partly, satisfy the same needs of a consumer such that the consumer may use
one for instead for another.
substitute products or services limit the potential of an industry.
margarine can be a substitute for butter. Likewise Coke for Pepsi
But not everybody will be willing to switch brands because they have developed a
taste for a particular cola. This is why manufacturers try to differentiate their
products from their competitors so that the customers will develop product loyalty
from their brand.