Management team must be quite effective and efficient in order to realize what are the reasons for any organizational crisis due to the involvement of shareholder within economic and other financial issues (Boutelle, 2004). The basic feature of a shareholder could be known from the involvement of relative power corresponding a shareholder, his/her mindset and freedom of giving valuable suggestions related to any issue and importance of time and urgency of resources for any project (Mitchell, 1997). Clarifying these potential positions for any shareholder must be handled with care before and even after the time span of any crisis. Keeping these influences within the mind, a shift within the features of any shareholder could be noticed and their potential position could be predicted. Clarifying these issues could bring clarity and pureness within the working of any
The method is used for decision making and planning in the organization and used by the managers of the organizations. Organization uses this method to have accurate costing allocation in the production. It helps to have an accurate value of cost and profitability of each products and services. This methods help to convert indirect costs into direct costs which helps to achieve an accurate costs. The method helps to support decisions related to pricing, removing or adding items from the product protfolio and implementing evaluating processes for improvemnets in the organiation.
This way produced financial statements therefore increase transparency of a firm, which is particularly useful to potential investors, contractors and lenders, as they have a better perception of the stability of a given firm and insight into its. It provides a measurement of true income There is less of an opportunity to manipulate accounting data using the fair value approach. Instead of using the sale of assets to affect gains or losses, the price changes are simply tracked based on the actual or estimated value. The changes to income happen with the changes to the asset value, reflected in the final net income numbers. It is the most agreed upon standard of accounting Instead of the historical cost value that isn’t always accurate after a long period of time, fair value accounting accurately tracks all types of assets, from equipment to buildings to even land.
This framework allows enough flexibility to deal with changes in the environment without managers having the need to regularly adopt new strategic measures. Under the stakeholder-based approach management is encouraged to develop strategies to identify, and invest in all the relationships that will ensure success in the long run. For a stakeholder-based approach to be successful, values must be incorporated as the key element of the management
There are some views in the organizations through balanced scorecard, which are the learning and growth, financial perspective, business process perspective and customer perspective. In fact, framework common language was provided by balanced scorecard (BSC) to refine the strategy pays decision to inform the employee or staff about the drivers of the success. In short, executive of the organization can imploded the capabilities specialized knowledge of human capital development in the organization and attempt to achieve long-term objectives and goals. (Taheri
Few external scenarios such as country’s inflation rate, economies of scale, government policies, and international business environment factors result in formulation of effective framing of the policies. IMPORTANCE OF STRATEGIC AUDIT IN THE ORGANIZATION • Assessing Current Strategy- Assessing the current strategy of the company helps in maintenance and effective utilization of certain resources within the organization levels. Audit helps the management to take up effective decision making and formulation of policies for the company. • Identify Strategic Risks- Auditing helps the management to identify the potential risks associated with the strategies formulated by the companies. Auditor should possess sufficient knowledge in judging the resources and effective allocation; this is possible only in the process of auditing.
Risk management Risks are everywhere, but the problem is how organizations assess, control and finance them. It is an advantage to foresee and calculate risks to manage it properly in an organization because it may become critically important in today’s challenging economic times. According to Reuvid (2010), risk management has multiple benefits and makes good business sense which led managers to make good investments, protect them more confidently and have a lower cost of risk, but have a greater chance of reaching strategies objective. Organizations that manage and oversee risks appreciate a 'righteous circle' with regards to the relationship with underwriters. By controlling risks and diminishing interior costs, organizations can appreciate
It is in a straight line connected and exact to the trade, and exemplifies chances inside the supply pedestal to moreover lessen price otherwise augment the cost of goods or services requisite via the industry. usually, it comprise insist supervision and supplier management. though, more and more it is vital to feature in whole rate of possession (TCO) and sustainability. Strategic sourcing benefits for an organization include: 1. Improved ability of the organization to achieve strategic goals due to alignment of purchasing strategies with business strategies.
Further, the department, to foster the achievement of not only its goals and objectives, but the other departments’ and the organization in general, works closely with the other departments of the organization, to formulate and implement specific activities that foster productivity, performance, improved revenues, and cost management and containment. While, unlike the sales and commercial department that engages in selling to generate revenues, the human resources department does not engage in similar activities that directly bring in revenues to the business, its activities in general, will foster the realization of good financial performance of the business, through enhanced productivity and performance. At the same time, its activities will foster cost management and containment within the department itself and the organization in general, which is integral to the pursuit of profitability and financial performance goals of the business. Reflecting and looking back on the interview, I feel that most of the theoretical concepts covered in class so far, are very applicable in the real world, and in many ways, contribute to the achievement of organizational goals and objectives, and more particularly, the financial performance goals and
Chapter No 1 1 Introduction: Now a day, the most important issues of a financial organization are profitability and liquidity issues which need to be balanced properly against one another. According to some scholars the more important issue is liquidity because the companies those have low or zero profitability as the end of specific period are able to serve best to the economy as compare to the companies those have low or zero liquidity. (Eljelly, 2004). The studies conducted mainly in the field of corporate finance that focuses on the key decisions like capital structuring, dividing policy making and budgeting the capital and all these issues that involve the studies of long term finance division making of a company so often , the ignored