A solid business infrastructure is vital for building a successful business. Just like anything else that requires a solid infrastructure, businesses without this will struggle to thrive.
So what does having a business infrastructure mean? And what does it entail specifically?
That’s exactly what we’ll be looking at in this post. Once you’ve finished reading this post you’ll know exactly what a business infrastructure means and you’ll know what you need to get your own infrastructure set up solid.
What Does A Business Infrastructure Entail and Why Is It Important?
A business infrastructure entails the following:
- Human resources
- Business processes
- Operational tools
These three things are the foundation of a successful business infrastructure. However, just because you have these three things in place doesn’t mean your business will necessarily be successful.
For a business infrastructure to function effectively all of these processes need to be coordinated and working. If not then it’s unlikely the business will run smoothly. Essentially, they all rely on each other to succeed. If one malfunctions then the others will not function well.
When either of these processes aren’t running well then you’ll find that specific aspects of the business will become hampered. For example, if the hiring process is not solid then this affects the human resources aspect of running the business.
If the software used in the business is not appropriate, then this affects various business processes and human resources aspects. So it’s super important that all three of these foundational aspects are running well.
Also, consider the kind of business you’re looking to form because this also plays a role in the infrastructure you’ll need.
For example, while a sole trader needs some kind of infrastructure to run smoothly, they are certainly not going to need an infrastructure on the same scale as a Limited Company.
HR encompasses all the people in your team. They include everyone from the CEO, and all the various departments within the company. You’ll find a financial division, sales, marketing, accounting, legal, and much more. These all fall under the umbrella of HR.
They are the people that make your business run on a daily basis. All of these different departments needs to be functioning together for the company to run properly.
Essentially, HR is responsible for the management, administration, and organisation of the business daily. The roles within each of these areas is varied and can encompass matters like hiring new staff, training, safety, payment, and plenty more. Each of these areas will fall under a different umbrella within HR.
We’re sure you can see why having a HR team is so important in a business. Making sure that everything is clearly laid out, having roles and responsibilities assigned to relevant areas within the business makes everything flow much more smoothly than it otherwise would.
This way, all tasks, whether it’s legal, financial, training, employment matters, disputes, all fall into their relevant brackets. They then have their processes that make them run effectively, which is what we’ll explore in the next point.
No business can ever truly function without effective processes and systems. These processes and systems need to cover all departments and all tasks within a business. The more that each process or task can be systemised, the easier the business will be run.
For example, when you want to hire new employees there should be a process for this. A process that involves receiving applications, assessing them, interviewing them, down to what to look for in the interview itself.
Another area is paying employees. There should be processes for this. Whether it’s logging each employee’s hours, process for submitting invoices if necessary, and then a process for how the eventual payment will be made.
Then think about processes involving disputes between managers and team members. There needs to be processes involved for how this needs to be followed. There needs to be a process for how a sale will be completed. We could go on forever but we’re sure you can now see the picture.
You can see that what this does is systemise many parts of running a business. Rather than having to create a new process for each person, you have an overall process that encompasses procedures for the entire company. This makes everything flow smoothly.
In a nutshell, it’s basically procedures for how individual things within a company should work and then what defines those procedures. If you don’t have such business processes set up in advance then you could find yourself facing many messy situations.
The operational side of the business infrastructure is just as important as the others. Each business needs to perform certain actions like documenting payments, disputes, legal matters, signing contracts , and plenty more.
This also encompasses things like the type of software a business uses. This could be software that helps with the business’ marketing. It could help with managing customer databases, keeping track of payments that need to be made, and equipment and tools the company uses.
Essentially, this is an area that governs managing and directing physical and technical functions within a business. It’s like the glue that keeps everything held together tightly.
For example, it makes storing and managing employee contracts much easier. There can be an operational process setup using custom software that is designed to track when an employee’s contract is ending, and if it needs to be renewed. It can track and monitor certain aspects of customer behaviour, purchasing behaviour, and predict future buying behaviour.
These kinds of operational tools within a business allow the business to function smoothly and must be set up accordingly. Remember, the whole point of this is to make the overall operation of the business easier and more efficient.
If it doesn’t do this then it’s broken somewhere.
Your business infrastructure needs to effectively coordinate between human resources, business processes, and operational tools. This infrastructure should serve as your immoveable foundation. One that makes your business strong and helps it become profitable.
It’s this infrastructure that is at the heart of every successful business. You won’t find a successful business that doesn’t have this kind of infrastructure set up. So if you are a Startup, we’d advise you to think about creating such an infrastructure as soon as possible because the long term growth of your business depends on it.
Still unsure of where to start? Well, we have something special for you. Click here to download our free Startup eBook. This will cover all the legal aspects you need to know about forming a Startup so you can feel confident the pesky taxman won’t come after you.