The Importance of business administration encompasses all relevant aspects of this process, which have a positive impact on achieving the organization’s objectives. Therefore, all these factors will be key pieces in making any decision of the working group.
It is essential that the company has clearly and well defined its goals and purposes. They must be reported to the team that composes it, so that everyone can work in unison, according to the consolidation of the proposed objectives.
The administration works to develop a systematized and structured process of planning, organization, execution and control of resources, in search of the growth and stability of the company.
Administration’s success lies in the fact that it manages to increase and maintain high levels of efficiency in each of the human, financial, material and technological elements that make up the company. This will be the basis for the organization to achieve the expected results.
Reasons for the Importance of business administration
Below are the 12 reasons for the Importance of business administration
Keeps finances at an excellent level
Money administration is crucial in any business. Excellent administration will allow the organization to stay on its feet, moving forward. Otherwise, it might disappear due to misadministration.
The company is a dynamic entity, for which the administration needs to constantly evaluate the different scenarios, looking for successes or errors in the policies put into practice, not only to comply with them, but also to propose possible changes.
To maximize benefits and minimize risks, expense controls are exercised and an accounting system is established to provide reliability to projected data.
increase productivity
Identifying the weaknesses and strengths of the process is vital for a company. The strengths found should be recognized and highlighted.
Errors in the process will be treated differently, as it is necessary to make plans to correct them.
Pursuing efficiency in all processes will result in the reduction of resources used and the production of more in less time, which will guarantee better results.
Helps to achieve goals
There is nothing more important for an organization than achieving goals that have been set at all levels. Administrationis one of the fundamental bastions for this to happen, for which it formulates a series of strategies harmoniously orchestrated with all departments.
The central idea is that everything revolves around achieving goals. That’s why actions are taken to coordinate, direct and control resources, as well as establish a solid organization, where the authority and responsibility relationships between employees are clear.
Throughout the process, evaluations of the strategies are carried out. It seeks to modify those that do not point to the consolidation of the organizational objective.
Generate customer and employee satisfaction
Implementing more efficient processes makes customers happy; This leads to closer business ties. For its part, the organization will better understand their needs and offer better products and services.
In addition, as the tasks have been optimized internally, the employee’s work becomes more efficient and he feels more comfortable seeing that he has less wear and tear in fulfilling his tasks.
reduce waste
Waste within a company is a very important aspect. It would be a serious mistake not to consider the negative consequences this brings.
Overproduction, time lost between each process, excess stock of a material, production defects and even waste of human resources are examples of waste in a company.
All this does not add value to the product, bringing losses of all kinds to the organization. That’s why administration acts planning and controlling, to try to minimize the levels of waste. Once these are reduced, productivity will increase.
Adapt the organization to market demand
A company must survive in a changing environment. Therefore, administration must monitor external variations in order to suggest actions aimed at the growth and maintenance of the organization.
In addition, this open relationship with the different factors that make up the external environment provides a broad view of situations, being able to predict future events and possible implications for the company.
Facilitates sustainable growth
The growth of a company is not a product of chance, it is the result of a joint effort between all the employees that compose it and the effective execution of operational planning.
Administration works internally with motivation, teamwork and the pursuit of workers’ personal success. All of these strategies promote a sense of loyalty to the company. Therefore, in support of any growth initiative.
It also manages the external economic and social variables linked to the company, offering an essential global view in the decision of actions based on operational or financial growth.
Improve corporate image
The organization needs to project itself, internally and externally, with a strong and consolidated image.
Administration directly contributes to this, as, by producing excellent quality goods and services and creating a friendly environment with the internal and external public, it positively influences the company’s projection in the business and market areas.
By having an external identity consistent with the internal image, the company will have an excellent letter of introduction to competitors, customers and among the employees themselves.
Optimize resource usage
Administration gives the company the opportunity to efficiently use the human resources and the technological and financial materials that compose it. This translates into obtaining favorable results that will help to achieve the proposed objectives.
This optimization offers the company different proposals, which include the possibility of saving on some resources or the need to work quickly on a critical point that is affecting its growth.
Effective resource administration is the key to an organization’s growth and prosperity.
Reduce costs
One of the administration principles is to improve effectiveness. This translates directly into cost savings, a very important aspect in any organization.
To achieve this, administration uses the right combination of different resources as a strategy. In addition, it uses different processes and operational control strategies.
Improve internal and external communication
Communication is a component of administrations that is becoming more and more important and more emphasis is placed on it so that it works as efficiently as possible. Internal communication (which takes place within the administration itself) and external communication (with consumers and customers).
External communication was favored by new channels, such as social networks, new messaging or email services. This transformation has led to the creation of even more specialized customer service departments.
As for internal communication, it is no longer based solely on sporadic meetings or orders that pass from subordinate to subordinate. Business administration ensures that regular meetings are held and the communication channels provided for each case are kept active.
The technological innovations that most revolutionized this change are project administration software with a web interface like Trello or Asana.
build alliances
Business administration constantly resorts to strategic alliances to improve the relationship between customers, allies and even detractors. They can be profitable alliances, such as the merger of companies or projects, but also altruistic, such as the creation of a foundation that generates social value.
It is one of the most recurrent sources of commercial value in recent times, in which alliances add more than they subtract and competition is no longer seen as an enemy and is seen as a perfect complement to increase the market and profits.
We hope you have fully grasped the points of the Importance of business administration after reading this article.
