Business management is a broad term that refers to any leadership activity that affects how a company operates and reaches its goals. It covers many different fields. Jobs in business management usually focus on the overall strategy of the company rather than the day-to-day tasks, with an emphasis on communication and organization.
If you are interested in starting a career in business management, launching your own business, or earning a higher degree or certification, this guide will help you understand the different branches of this large field and the role each one plays in a business.
What is Business Management?
Business managers solve problems and make decisions to help a company stay stable and grow. They figure out what resources are needed, coordinate activities, and make choices to guide the company in the right direction. In business management, you are in charge of planning, training, delegating, and guiding other leaders to achieve the company’s mission and goals. To handle these tasks well, you need strong skills in strategy, critical thinking, and problem-solving.
Business management often focuses on people, so good managers should be empathetic, able to solve conflicts, and communicate clearly with everyone in the company. They should also be good at mentoring and developing employees, placing the right people in the right roles and projects to help the business succeed.
Types of Business Management
There are many areas in business management. Here is an overview of the eight main branches of this field:
- Financial Management
Financial management involves planning budgets and managing cash flow, as well as overseeing financial tasks like processing invoices and distributing data. It includes directing and organizing a company’s financial activities such as accounting, investing, banking, insurance, and more. It also often works with human resources management when managing payroll and benefits budgets.
Financial management focuses on three key elements: financial planning, control, and decision-making. Short-term financial management, known as “working capital management,” deals with managing cash, inventory, and debts. This branch also involves finding a balance between profit and risk to ensure the company remains profitable in the long term.
Lizette Fallon, director of finance and operations at Wellspring Center for Prevention, says cash flow management is the most important task in her department, ensuring there is enough money to pay employees and suppliers even when payments are delayed.
- Marketing Management
Marketing management involves using marketing techniques and managing a company’s marketing resources. It covers areas such as company analysis, competitor analysis, customer analysis, and brand management, as well as pricing strategies.
Marisa Sanfilippo, a marketing director and consultant, explains that while driving revenue is a key part of marketing, managers must also take ownership of the brand and make sure everyone in the company communicates the brand message in the same way.
She highlights the importance of regular communication with the team to ensure clear goals and expectations.
- Sales Management
Sales management is about leading sales teams, building relationships with potential customers, and guiding them through the sales process. Sales managers work closely with marketing managers to ensure consistent messaging and goal alignment.
Sales management also involves tracking performance using metrics and tools like Salesforce for customer relationship management. In smaller businesses, leaders like founders or CEOs may also play an important role in driving sales efforts.
- Human Resource Management (HRM)
HRM focuses on recruiting and managing employees, including their compensation, safety, wellness, and benefits. Good HRM helps employees contribute effectively to the company’s goals.
Kris Kildahl, chief people officer of Certinia, says HRM’s main job is to connect employees to the company’s strategy, making sure they are engaged and doing important work. Effective HRM also includes building repeatable processes and automating tasks to respond quickly to the changing needs of the business.
- Strategic Management
Strategic management is the process of applying strategic thinking to lead a company, often handled by top executives. Many areas of business management, like finance and marketing, are shaped by strategic decisions.
Ronak Sheth, CEO of Pricefx, says the most important part of strategic management is building a strong leadership team with talented, proactive people who align with the company’s values. Strategic management involves goal setting, analysis, development of strategies, and continuous evaluation of progress.
- Product Management
Product management is necessary for businesses that offer products, either physical or digital. Product managers coordinate efforts across departments to develop, launch, and improve products.
Successful product management requires a mix of market research and product knowledge to prioritize features that benefit customers. Brendan Fortune, director of product management at Customer.io, emphasizes the importance of gathering feedback from customers and other sources to guide product development.
- Operations Management
Operations management involves designing and overseeing business processes to make the company more efficient. The goal is to balance cost-efficiency with quality so that products or services are delivered effectively and profitably.
James Nartey, a member of the business operations team at Hiedberg, explains that the main goal of operations management is to support sales and delivery teams, helping them perform their best. Operations leaders must be open to new ideas and willing to experiment with processes to find what works best.
- Information Technology (IT) and Service Management
IT and service management focus on aligning a company’s technology and services with its strategic goals and customer needs. IT management involves overseeing the company’s technology infrastructure to meet current and future needs, while service management may also include the development of non-IT services.
Mike Finley, CTO and co-founder of AnswerRocket, talks about balancing tactical and strategic approaches in IT management, especially with the rise of generative AI. IT leaders need to ensure that both the operational and innovative sides of technology are in sync with business goals.
Bottom Line
While not every company has dedicated leaders for all branches of business management, every area should be covered when building a leadership team. If one leader is responsible for too many tasks, it may be worth considering outsourcing some functions to a part-time leader or a specialized company.
