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10 Best Practices for Small Business Operations Management

Running a small business requires talent, accountability, and a strong work ethic. As a business owner, you’re likely to wear multiple hats in the course of any given day. You may be focused on hiring one moment, sales the next, and operations management the moment after that. It can be a lot for anybody to handle.

At Select Funding, we love working with small business owners because we recognize the hard work and dedication it takes to keep any business operation afloat. Small business operations management is a frequent topic of conversation because improper management can be a detriment to any company.

One way to avoid operations issues is to adhere to best practices. Here are 10 best practices for small business operations management to follow.

What is Small Business Operations Management?

Small business operations management involves the process of administering business practices to maximize efficiency in the day-to-day operations of a business. While the primary concern is with business practices, operations management (OM for short) may also refer to improving the efficiency of manufacturing processes, including converting labor and materials into goods and services.

With effective operations management, it’s possible to reduce costs and maximize the profits of any business. Another way to look at operations management is that its purpose is to balance costs with revenue to maximize net profits.

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What is a Business Operations Manager?

A business operations manager is a person whose responsibility it is to streamline and oversee operations. They may have a hand in many different aspects of a company’s operations, including hiring, budgeting, contracts, and more.

The work of a business operations manager falls into these four categories:

  • Financial Information and Budgets. The business operations manager plays a significant role in budgeting and should be involved to make sure that money is being spent efficiently. On an ongoing basis, they should monitor expenses and engage in cost-benefit analysis to avoid overspending.
  • Supply Chain and Inventory. Another part of a business operations manager’s job is to oversee supply chain and inventory. They should keep an eye on the cost of raw materials as well as inventory and supply chain efficiency to be sure that everything is operating smoothly and customers aren’t left waiting for products.
  • Workflow and Staffing. Staffing is one of the keys to operational efficiency, so it makes sense for the business operations manager to oversee staffing and hiring. They may also review operational workflows to maximize efficiency and take a hand in employee morale and discipline, too.
  • Big-Picture Thinking. When you put the first three responsibilities together, what you get is a single person who is in the best possible position to have a big-picture view of the organization and its operations. The business operations manager can and should understand everything that’s going on and use their unique position to analyze situations and opportunities and provide insights to leadership.

When a small business operations manager is hired, they have the potential to revamp a company’s operations and increase profits by streamlining processes and eliminating inefficiencies.

Why is Small Business Operations Management Important?

Before we reveal some best practices for small business operations management, let’s review some of the ways in which making operations management a priority can help your small business.

Quality Control

Without quality control, it can be difficult for small businesses to hold onto customers and build a reputation for their brand. The right small business operations manager will improve quality control by streamlining the acquisition of supplies and standardizing production to make sure that every product you create is up to your standards.

Reduced Operating Expenses

Out-of-control spending is often a contributing factor to small business failure, so it stands to reason that one of the key benefits of operations management is controlling and minimizing expenses. An operations manager might handle negotiations with suppliers and have a hand in hiring expenses, both of which can contribute to keeping costs under control.


Business inefficiencies can cut into your profits by causing production delays and impacting customer service. Small business operations management focuses on increasing productivity by clearing roadblocks that might get in the way.

Customer Satisfaction

While customer satisfaction might not seem to be at the forefront in a discussion about minimizing costs and operating expenses, the opposite is true. Proper operations management puts customers’ satisfaction first by improving services, speeding production times, and reducing costs–all of which impact the way customers feel about your business.

10 Best Practices for Effective Small Business Operations Management

Here are 10 best practices to help you make the most of small business operations management.

#1: Leave Your Ego Behind

There’s one thing that can undercut everything you do to streamline your operations, and that’s ego. We all have a tendency toward thinking that our way is the best way, but it’s not always the case. You’ll get the most from your small business operations management if you leave your ego and any preconceived notions you’re carrying behind and keep an open mind.

#2: Set Team Expectations

In an ideal world, every small business would incorporate operations management from the outset, but that’s not the way things usually happen. If you’re planning an overhaul of your operations, one of the most important things you can do is to get your team on board and make sure everyone has the proper mindset: that you’ll be working together to streamline operations and processes in a way that will help employees and customers while increasing profits.

#3: Encourage Feedback

Communication is at the heart of small business success, so part of encouraging the proper mindset is communicating with your staff about what you’ll be doing to streamline operations and understanding how they feel about it. In the early stages, it makes sense to collect information from the people who are carrying out the processes you’ll be streamlining and making sure you understand what they do, how they do it, and why they do it the way they do.

#4: Embrace Transparency

Closely related to communication is the issue of transparency. Nobody likes to feel that there’s an air of secrecy at work. While you’re under no obligation to reveal everything to your staff, it is a good idea to keep them in the loop when possible. Being transparent about what you’re doing to improve productivity will make employees feel they have a voice and a purpose.

#5: Focus on Process Efficiency

It’s common for business processes to develop over time. Sometimes, a new employee may learn a process from an employee who’s been doing it the same way for a while without thinking about whether the process could be streamlined. The best practice here is to get written versions of the process from each employee who performs it and then refine the information you’ve collected until the written documentation is so clear that somebody with no experience could complete it simply by reading it.

#6: Keep an Eye on the Future

Today’s processes might be efficient in the here and now, but have you thought about how they would work in the event you had to double or triple your production? While it’s true that you can’t plan for every possible contingency, it does make sense to look at your processes with the future in mind. The best way to accomplish this task is to review your projections and objectives and use those to anticipate necessary changes.

#7: Collect Data and Use It in Decision Making

We’ve already talked about the need to solicit feedback, but it’s equally as important to remember that personal feedback is likely to be subjective. You need data to make sure that your operations are working as intended, so that means building the means to collect data into your daily operations. 

#8: Build Your Team with Operations in Mind

With business operations management comes growth, and with growth comes the need to add to your team. As you embrace small business operations management, you should be thinking about how what you learn will impact your hiring decisions. Ultimately, you want employees whose skills and attitudes align with your long-term goals.

#9: Own the Process from Start to Finish

Any process you streamline should be viewed from a big picture perspective. When your focus is on increasing profits, every part of your business processes should be included in streamlining. There’s no task too small because ultimately, every task plays a role in creating your products or providing your services.

#10: Make Customers Your Priority

The final best practice is to keep your eye on your customers. While small business operations management is largely an internal process, that doesn’t mean that your customers don’t matter. Every decision you make should be geared toward providing the best possible customer experience and customer service at every step of the way.
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Get Financing to Fuel Small Business Operations Management

Small business operations management is something that can get you from the early stages of business success to making all your dreams and business goals come to fruition. The key is following the 10 best practices we’ve outlined here to make sure that you’re on the right track.

Do you need working capital to make small business operations management a priority? Select Funding can help! Click here to read about our small business financing and begin the application process today.