Business Administrators: The Skills Needed for Making Good Decisions

A company’s business administrator plays a crucial role in ensuring its efficient operation. Regardless of title – CEO, general manager, operations manager or something else – the one who assumes the role of business administrator should be a mentor and motivator with many responsibilities. Perhaps the most important duty is making decisions that affect the organization, its employees and its stakeholders.

Skills required for a business administrator

Because a business administrator needs to “hold things together” in the company, he or she will face challenges throughout his or her tenure. Graduating from a good business administration program, such as the one at MTI College in Sacramento, can help prepare you for those challenges. However, to manage the needs of the organization, the business administrator also needs to be particularly skilled in:

  • Communicating business activities and status with management and between management and employees
  • Planning and organizing procedures and policies
  • Critical thinking and knowing how to make decisions that will affect many
  • Concepting ideas and strategies to help keep the company on track and in the black
  • Negotiating to improve the organization
  • Being part of a team to achieve goals
  • Using technology to update and manage data, plans and procedures

Of those skills, critical thinking is most important to a key area of the business administrator’s job: decision-making.

Steps to making decisions

Herbert Simon – Nobel Prize-winning American political scientist, economist, sociologist and psychologist – wrote in Administrative Behavior: a Study in Decision Making Processes in Administrative Organizations that decision-making is the “heart” of business administration. He believed that the logic and the psychology of human choice determine administrative theory, and the duty of the business administrator is to design an environment that allows the approach to decision-making to be as rational as possible. This is accomplished by following these general steps to making decisions:

  • Recognize the problem or opportunity and then address it.
  • Gather information to make an informed decision.
  • Identify other possibilities by analyzing various solutions.
  • Weigh the pros and cons, and choose the option that offers the greatest potential for success.
  • Choose from among the alternatives, but understand the risks that come with each.
  • Take action by creating a plan to implement your decision; know which resources are required and get others involved.
  • Review the decision and evaluate it for effectiveness; determine how you can improve it for the next time.

Although the steps in making decisions are similar, the approach to decision-making can differ.

Reactive decision-making

Sometimes unexpected things happen, and the business administrator – the decision maker – is put on the spot to solve the problem; he or she “reacts” to the situation. An example could be a burglary at the office, the sudden resignations of several key players or a natural disaster. When companies make reactive decisions that are not well thought out, they can be unwise, putting the company behind its competition. An administrator who chronically makes decisions reactively may not have the experience and adaptability to plan ahead and take charge.

Proactive decision-making

A business administrator who proactively makes decisions can actually relieve stress and maintain control. By being proactive, a business administrator can anticipate problems and plan ahead. He or she develops habits that help advance the company’s objectives and respond to unexpected situations. For example, if the company has an emergency escape plan that has been communicated and practiced among employees, everyone will know what to do if and when the time comes. Similarly, if there’s a backup plan in place for scheduled employee absences, it can be put in place in the event of resignations or downsizing. By planning ahead – being proactive – the company, through its business administrator, can stay ahead of potential problems and issues, and focus on the long-term goals.

Strategic decision-making

Creating a plan based on the company’s mission or long-term goals and visions is strategic decision-making. When the “big picture” is in the foreground, it’s much easier to align shorter-term goals so that they ultimately impact the long-term mission. Each of these is a step toward the company’s goals, which guide the strategic decisions and provide a quantifiable assessment of progress.

Business administrators use strategic decision-making to plan for their company’s future, keeping in mind the impact potential decisions will have on the company, its competition and its market. They need to consider:

  • Long-term company growth
    The administrator and management need to determine how much growth they want to achieve, how they want to get there and how to handle scenarios that are likely to come up as the company grows.
  • Risk
    No one can know exactly what the future holds, but administrators must anticipate change and the risks associated with it. Usually, the changes are significant, such as having to introduce a new manufacturing system or needing to modify company culture because of excessive employee turnover.
  • Analysis
    By analyzing the company’s position in the market and understanding its strengths and weaknesses, the business administrator can plan appropriate responses to remedy any problems and improve market share.
  • Implementation
    Administrators need to map out their plans and figure out what resources and staff to use to reach their goals.

MTI College

Getting an associate degree in business administration from MTI College is an important first step to put you on the path to a versatile career in marketing, human relations, management, economics or accounting. MTI’s thorough training is a foundation in general business administrative skills and the principles of business management – that you can build on and grow with.

There’s no time like the present to begin your business administration training. Contact MTI today to get on the road to an exciting career.

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