Managing and Running a Small Business: A Comprehensive Guide

Managing and Running a Small Business
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Managing and running a small business
Contents
Introduction....................................................................................................................................4
TASK 1...........................................................................................................................................5
P1. Discuss the main considerations a small business or social enterprise needs to address
when planning and allocating resources to achieve business objectives...................................5
M1 Apply relevant tools and techniques in a structured and analytical way to plan and
allocate resources in an organisational context...........................................................................6
M2 Assess the importance of planning and allocating resources to achieve the business
objectives........................................................................................................................................7
D1 Critically analyse the application of appropriate resources to demonstrate links
between resource allocation and achievement of business objectives.......................................8
TASK 2...........................................................................................................................................9
P2 Explain and evaluate different processes of customer relationship management for a
small business or social enterprise...............................................................................................9
P3. Explain how a small business can develop transnationally and determine the benefits
and drawbacks.............................................................................................................................10
M3 Apply and evaluate the elements of the customer relationship management process in
relation to achieving business objectives...................................................................................11
M4 Evaluate the potential to develop transnational operations using the stage model of
internationalisation, assessing both benefits and challenges...................................................12
D2 Critically evaluate the customer relationship management process at all stages and
provide recommendations for overcoming challenges of developing transnational
operations.....................................................................................................................................13
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Managing and running a small business
TASK 3.........................................................................................................................................14
P4. Produce an annual itemised monthly cash flow forecast showing fixed and variable
costs set against income for a specific organisation..................................................................14
P5. Explain how break- even analysis could be applied to an organisational situation........15
P6. Interpret key financial statements for an organisation in relation to how they
contribute to the successful management of the organisation.................................................16
M5. Quantitative and analytical techniques to provide an appropriately detailed cash flow
forecast and break-even analysis................................................................................................17
D3. Produce an accurate cash flow forecast and break-even analysis with a critical
evaluation of how key financial statements contribute to the successful management of the
business.........................................................................................................................................18
TASK 4.........................................................................................................................................19
P7 Discuss key legislation and regulations that have implications on small businesses or
social enterprises..........................................................................................................................19
M6 Evaluate the implications of key legislation and regulations in an organisational
context...........................................................................................................................................20
D4 Critically evaluate key legislation and regulations that affect small businesses or social
enterprise organisations, taking future developments and changes into account.................21
Conclusion....................................................................................................................................22
Reference......................................................................................................................................23
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Managing and running a small business
Introduction
Anyone maybe passionate about setting up a small business but no matter how enthusiastic he is,
won't be successful unless there is a clear business strategy to set up a small business.
Any business starts with an idea but a businessman needs something more than just idea to
realize his business dreams. Hard work, intelligent decisions, dedicated employees can help a lot
to be successful in small businesses. There will be a constant competition to retain the existing
customers and stitching the new ones in the Marketplace, so a businessman can never simply rest
on his laurels. Constant research on the market, making superior quality products and effective
customer relationship management can help an entrepreneur to be successful in his business
venture. The company selected in this study is GlaxoSmithKline which is effectively performing
in the UK market.
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Managing and running a small business
TASK 1
P1. Discuss the main considerations a small business or social enterprise needs to address
when planning and allocating resources to achieve business objectives.
Identifying the important resources is the trickiest part of a business. To figure out which type of
resources is exactly needed for the business, proper business planning is very crucial. Some basic
resources are crucial to start a small business that will survive for a long period of time. The
most important one will always be the sound knowledge needed to start a particular type of
business as opined by Cabanillas et.al (2013). The Other factors which are equally important to
turn a small business venture into a successful one are discussed below-
 Starting a small business or social enterprise is not a very simple task and cannot be just set up
like that. The most important resource is the workforce for any organisation. So, the main
consideration will be appointing the right kind of employees.
 The good support system is another important resource for a small business venture. The
entrepreneur first uses every opportunity to talk with another businessman who is already
established and running a successful business in the same category. The cat is valuable and was
advice about the business and its loopholes. The social networking sites can work wonders for
any small business entrepreneur.
 Another important resource is to arrange the capital to start the business. One must have
adequate personal savings to start the business; otherwise, he arranges bank loans to finance the
business.
Once the Businessman is ready with his basic resources he is already on his way to start a
successful small business.
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Managing and running a small business
M1 Apply relevant tools and techniques in a structured and analytical way to plan and
allocate resources in an organisational context
Resource allocation is a process to decide where the resources are to be used in the production of
goods or services. Resource allocation is optimum when they are used to produce that kind of
goods or services which matches the needs of the customer and also lower the possible cost of
producing them.
GlaxoSmithKline uses some relevant techniques to plan and allocate their resources. They are:
 Strategic relocation and rearrangement of their resources so that the excess one can be used
effectively in future. Their workforce can be occupied optimally by this strategy.
 They diversify responsibilities among the employees. They recognize as well as nurture the skills
of their employees and motivate them properly.
 They always try to have optimum utilization as their default status. This implies that they have
healthy resource allocation habits.
Trial and error is the secret which the resource managers of GlaxoSmithKline exhibit prior to the
effective allocation of the resources. They are very unconventional in their way to practice
resource allocation which has definitely rewarded them in terms of handsome profits.
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