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Effective Tools for Management

Analyzing the organization's use of planning tools for financial stability and performance, and the role of management accounting in preventing and solving financial problems.

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Added on  2023-06-10

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This article discusses the effective tools for management in financial planning and accounting, including Activity Based Costing, Balanced Score Card, and Benchmarking. It also includes a case study on how Accor Hotel applied management tools to respond to their financial problems. The article emphasizes the importance of sound decision-making for better financial performance and sustainability in organizations.

Effective Tools for Management

Analyzing the organization's use of planning tools for financial stability and performance, and the role of management accounting in preventing and solving financial problems.

   Added on 2023-06-10

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Running head: EFFECTIVE TOOLS FOR MANAGEMENT
Effective Tools for Management
Name of the Student:
Name of the University:
Effective Tools for Management_1
1EFFECTIVE TOOLS FOR MANAGEMENT
Effective Tools for Management
The primary objective of a business organization is to maximize the operational revenues.
These objectives are followed by the sound financial planning and management. Hence the
financial planning is the best tool for management. Financial management refers to the vital
activity that is done by the organization. The process includes plan, organize, control, and
supervision of the various resources of the organization and achieve the ultimate organizational
goal (Langfield-Smith et al. 2017). However the originations have to face a lot of issues at the
time of adapting the various management strategiec models and practices for responding to the
external changes of the organizational environment. The application of the various accounting
management tools would help in reducing the issues and enhance the regular business operations
and take effective decisions for a better financial performance. In order to maintain a sustainable
business operation, the management tools are highly effective.
Part A
Comparison of the planning tools in the process of management accounting
The management accounting tools help the organizations to create a better value for its
shareholders and enhance the performance. In the discussion the highlighted modern tools for
accounting management includes:
Activity based Costing(ABC)
Balanced Score Card (BSC)
Benchmarking
Effective Tools for Management_2
2EFFECTIVE TOOLS FOR MANAGEMENT
Activity Based Costing: As per Taleb, Gibson and Hovey (2015), the activity based costing
refers to a beneficial tool that results in the greater accuracy costing of product. In Activity-based
costing (ABC) the process identifies the various overhead costs activities and then assigns the
same to its products. This tool of management system identifies the relation of the overhead
activities and manufactured items. The activities can also be taken as the event or transaction
which is known as the cost driver or activity driver. These may include the maintenance requests,
machine setups. Purchase orders, power consumed production orders and quality inspections.
Balanced Score Card: The balance Scorecard is another strategic tool for performance
management that can be used by managers of the organizations to maintain a track of the
implementation of various financial activities by the employees (Jansen 2018). This tool of
management would help in identifying and improving the various business internal functions and
their outcomes. The system is used for measurement and organizations feedback. The collection
of data is vital to give the quantitative outcomes and are gathered and interpreted by the
executives and managers for making better business decisions.
Benchmarking: The Benchmarking is anther process of measurement of the performance the
company. It measures the products, services and the processes of the business. The
benchmarking helps to identify the various improvement internal opportunities (Vladychyn
2017). In this process there is the comparison of the current company with the other company
that has a superior performance. Then comes the process of comparing the processes in which
the business would operate. Bench marking also helps in implementing the various changes that
can result insubstantial improvements in the organization.
Effective Tools for Management_3

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