logo

The Decision Making Process Assignment

   

Added on  2021-02-19

11 Pages3827 Words1320 Views
 | 
 | 
 | 
Financial Management
The Decision Making Process Assignment_1

Table of ContentsINTRODUCTION ...............................................................................................................................3MAIN BODY ......................................................................................................................................3LO 1 .....................................................................................................................................................3P1. Defining formal and informal approaches for effective decision making.................................3M1. & D1. Analysing advantages and disadvantages along with uses of formal and informalapproaches in effective decision making process............................................................................4LO 2......................................................................................................................................................6P2. Analysing key financial principles for achieving long term sustainability in the businessfinance..............................................................................................................................................6M2. & D2. Critically evaluating importance of financial management principles..........................7LO 3......................................................................................................................................................7P3. Role of management accountant in integrated business system................................................7P4. Evaluating the use of accounting control system along with their value in the integratedbusiness system................................................................................................................................8M3. & D3. Justifying the role of management accountants and accounting control system inimproving the process of financial decision making.....................................................................10CONCLUSION..................................................................................................................................10REFERENCES...................................................................................................................................11
The Decision Making Process Assignment_2

INTRODUCTION The term financial management is concerned with the process of planning, controlling, managingand directing of all the financial activities as well as resources of the business in an effectivemanner. Every business organisation requires funds or financial resources for conducting businessoperations, productions functions, for acquiring raw material, manpower etc. By managing thefinancial resources of the business, it helps in maximization of firm value and helps in minimizingthe cost of capital. Also, by formulating accurate and relevant business strategies, plans and policiesin line with the goals and business objectives can help in developing high market value andcustomer base as well. It is very important to keep monitoring or tracking the performance fordetermining whether the business operations are working towards the attainment of goals or as perthe strategies framed or not. The present report will define different approaches including bothformal as well as informal assisting in the decision making process for organisation. Further,explanation related to the key financial principles important in attaining long term financialsustainability will be provided. At last the report will streamline about the role of managementaccountant in the process of financial management. Different use of accounting control systemalong with its value will be describe in relation with the integrated business system.MAIN BODY LO 1 P1. Defining formal and informal approaches for effective decision making.Rational and effective decisions are very crucial for the success of every businessorganization because any kind of inappropriate planning and strategies can hamper the process ofdecision-making which can further completely ruin the business operations and thus the company asa whole. Thus, it is for this reason that managers are so precise and diligent in their planningprocess that quality decisions could be taken which could improve the profitability as well as theperformance level of the business organization. There are different types of formal and informalapproaches which the management can applies for supporting the effective decision making processsuch as :Formal approach :Under this approach, the decision-making takes place through the formal channels within theorganization. In this approach of decision-making, everything is clear regarding who will participatein the decision-making process, what steps will be followed during the process, properdocumentation of each and every activity and who will be in charge of which activity. The formalapproach includes :
The Decision Making Process Assignment_3

Processes : It is related with the adoption of best and better improved business processesand procedures which helps in increasing the overall business productivity as well as theprofit margin. Processes are well defined business procedure in accordance to whichactivities in decision-making can takes place.Proper organizational structure : One of the most important aspect for business toperform in an effective way is based on the organisational structure which the company ishaving. By having better and accurate organisational structure, it assists in the process ofdecision-making which is taking place through organized channels (Formal decisionmaking, 2016).Systems : Are defined as those business practices, concepts and management system on thebasis of which, every business organisation undertakes its business operations and activities.Systems are basically framework within which the decisions are to be taken viz. included inthe formal approach. These decision-making undertaken by company aids the managers intaking more rational decisions under controlled settings, standards and norms which furtherassist in improving the level of performance of the company and employees as a whole.Informal approach : When the decision-making process takes place in the uncontrolled and unstructured settingsthen such approach to decision-making is known as informal approach. There are various waysthrough which such decisions could be made such as : Interpersonal relationships between the employees/member of company : Having soundand good working culture, environment in the workplace can help in motivating the level ofemployees and workers as well. Smooth flow of communication enhance the productivityand also increases the operational efficiency of business. Decision making process of thecompany are made by the friendly relationships existing within the organization.Groups / networks : Team and group are considered as one of the most important humanresource for every business organisation without which no operational activities can beundertaken. Informal groups exists in the company and an informal network is createdthrough which decisions are taken within an organization (Brunsson and Olsen, 2018).M1. & D1. Analysing advantages and disadvantages along with uses of formal and informalapproaches in effective decision making process.Formal approachAdvantages :
The Decision Making Process Assignment_4

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Principles of Financial Management
|19
|5521
|92

Financial Management: Approaches, Principles, Role of Accountant, and Decision Making
|10
|2582
|96

Principles of Financial Management
|13
|4176
|43

Financial Management: Approaches, Principles, and Decision-making
|17
|5329
|4

Financial Management: Approaches, Principles, and Role
|19
|1105
|91

Different Approaches for Effective Decision Making in Financial Management
|17
|5605
|270