Financial management - Assignment PDF

Speaker Notes
Financial management
I. Formal and informal approaches in DOJI:
1.1 Definitions
Decision-making is a difficult and very challenging activity between the senior departments in
the organization's leadership and management in the business. Decision making includes two
main approaches: formal and informal approaches (Ejimabo, 2017).
Formal process is a structured, systematic, or rule-based transparent approach to categorizing
decision making and decision making processes (Ejimabo, 2017). This approach provides
participants with clarity and a well documented decision-making process. In addition, a formal
approach contributes to the level of time-based equity and confidence applied in the
organization.
An informal method is not a transparent solution and is contextual, holistic and dependent on
experiences of previous events, much as clinical decision making (Smolin, 2016). The Individual
and the decision-making framework were not well described in this approach (Hanzo, 2016).
This functionality, however, gives a great time to take decisions and is entirely flexible. In
addition, an informal approach is a subjective approach that is appropriate for some types of
problems. Formal decision-making can take longer than informal decision-making which may
take less time.
1.2 Apply formal and informal approaches to support decision making in DOJI
DOJI is a large gold and silver company with a decentralized organizational structure. The
company has multiple departments that are distinguished by policy areas and can range from
specialized tasks (marketing and service departments, sales departments ...). In addition, DOJI
has inter-organizational decisions that are made on the basis of formalization procedures (and are
specified as in the General Director's decision), informal advisory roles, negotiations. and
expertise is still very important. DOJI adopts two approaches for workplace decision making.
Horizontal and formal interactions between some of these departments must cooperate in the

implementation of a joint project with a cross-cutting level of relevance (e.g. between
departments, Directors, General Director and Staff).
The concept of a formal approach within the DOJI framework is based on an effort to gradually
develop a common space based on shared values, practices, policies and administrative
structures, where people, products, services and ideas can be freely circulated. It aims to develop
a commitment to specific values, practices, attitudes and norms, in addition to developing
political and administrative infrastructure in the workplace.
In the case of DOJI, this concept of integration can be illustrated by the variety of possible
decision-making procedures and the variety of stakeholders. Through the collaborative process,
an agreement on corporate policy and process areas calls for coordination based on self-set
performance standards, standards and indicators.
For example, in the case of a manager of a DOJI facility in Hanoi, when a customer buys a
defective product from the store, the manager has the right to change a new product for the
customer. The informal approach in this case is very relevant. Because, in this case, if we wait
for DOJI management's opinion to apply the form, it will take a lot of time to get a response
from the management, which means this waiting , must continue and incur such costs. such as
shipping and inventory. The informal approach have some advantages and disadvantages :
Advantages Disadvantages
Informal
approach
The informal approach's decision-making
speed is conveying information so quickly.
Although they can be done really quickly
there with transparency creates a need for
reasoning and reacts quickly to change,
especially for important decisions. Correctly
communicating this argument so that it does
The informal approach does not have a sustainable
systematic process that requires a lot of trust and
can lead to confusion, especially in developing
and changing teams. Consequently, an informal
approach can lead to disappointment, negative
outcomes and loss of trust, cracking workplace
relationships.

not lose trust takes longer to use a reliable
formal process. In addition, the informal
approach encourages and motivates
employees to expand their ability to overcome
work tasks and engages employees to
collaborate in the workplace creating
successful delivery decisions to fulfill
mission.
In case of salary payment, for example, DOJI launches a new product, formal approach will be
applied to the board's voting process on the product to see if the product should be marketed.
Adopting the formal approach to help the whole company make the best decision from the start
with a new product in case the product doesn't reach the customer's hands, causing revenue loss
that damages the image and reputation of the company.
The formal approach is very suitable with decision related with policy and operating decisions
and strategic decisions of company, but it has some advantages and disadvantages as follow:
Advantages Disadvantages
Formal approach The advantage of a formal approach to formal
decision making is to build trust and equity in
the organization through the specific
processes and operations of formal decision
making.
Formal approach is based on rigorous
standards and tight control to make and make
decisions tailored to the needs of the situation.
This approach has the advantage of helping
the organization reduce the level of chaos and
confusion in decision-making in
communication. A formal approach requires
processes and decisions to be spatially and
temporally synchronized.
A formal approach requires processes and
decisions to be spatially and temporally
synchronized. Consequently, the formal approach
requires a lot of time to make decisions through
chains and delays in formal structure by
imperative actions. In addition, the formal
organizational structure does not attach
importance to the psychological and social needs
of the employees, which can result in employees
being fired at the workplace. Ultimately, this
approach focuses only on the importance and
productivity of work through decision-making,
and prohibits human relationships, creativity, and
talent in the workplace (Benjamin, 2017 )

Formal approach is based on rigorous
standards and tight control to make and make
decisions tailored to the needs of the situation.
This approach has the advantage of helping
organizations minimize the level of chaos and
confusion in decision-making
communications.
2.3 The relationship between formal and informal approach:
Department members' structure, reporting relationships, job titles, resource development and
staff training to coordinate employee activities and possible core functions of the team
organizations make formal and informal approaches difficult to separate from an organization.
Furthermore, the relationship between formal and informal approaches supports each other in
improving the organization's performance and efficiency, both of which are aimed at making
decisions in favor of the community.
Critique the use of different formal and informal approaches to support decision-making
in DOJI
For DOJI, the organization should not take an informal approach, which will affect the
company's reputation as well as revenue if it is to manage a gold and silver branch on its own.
industry's general profitability. An informal approach, if applied, will only help managers better
understand their employees in the organization, not make important product decisions because
jewelry is Extremely valuable items need specialized people and general opinions to decide. But
if DOJI has successfully adopted a formal approach, retaining staff retention to ensure the goals
of the organization is extremely difficult because with this use, personal goals will be higher.
organization's goals. Therefore, DOJI needs to review and implement methods at the same time
to ensure the effectiveness of the decisions made to achieve the organization's objectives.
III. Analyze financial management principles which are used to support effective financial
strategies in DOJI

3.1 Primary objective of financial management
Financial management by DOJI is to Maximize Wealth. By efficient and wisely spending money
DOJI maximizes income. The wealth or worth of a company is known as the market price of the
investment capital. DOJI aims therefore to increase its shareholders' income. Building credit,
investing in real estate or other financial goods and which stock values are common policies and
approaches that companies use to optimize assets.
Furthermore, DOJI applies the stakeholder principle, considering the value and impacts of rich
development and of the company's interactions with numerous classes of components (such as
owners, creditors and representatives, consumers, providers, regulators and local communities).
This philosophy contributes enormously to and gives stakeholders equal emphasis to the DOJI's
long-term and sustainable growth.
Benefit companies can begin with traditional profit-making projects, in which the trustees' duty
is to pursue business strategies and activities, maximizing the company's investors' financial
return. The managerial and management team's management responsibility is exclusively for
shareholder gain. There is only one social responsibility of business – using its resources and
taking part in activities aimed at boosting its profit as long as it remains within the rules of the
game, which means open and free competition without disappointment or fraud.
Business initiatives that generated public goods have been promoted as a non-profit organisation,
and have pursued a "benefit-maximization" mission - to promote or deliver services that benefit
one or more identified constituencies (Rodrigues, 2011). State and federal tax laws regulate non-
profits to enable certain fiscal benefits (Murray and Hwang 2001) (Exemptions, 2016). Non-
profit organizations are continuously challenged to ensure that operational activities are linked
directly to the defined mission and goals (Kelly, 2005).
Financial planning includes:
• Estimated capital raised.
• Determine the form of funding, ie decide the form and rate of capital to raise.
• Develop and distribute financial policies, processes and procedures for the efficient use of
funds.
The main financial plan objectives are:
• To determine, for a given period, the amount of fixed capital and working capital required.
• Ensure that the requested funds are raised in the lowest possible time period.

• Ensuring sufficient liquidity to avoid default in payments and without difficulty, all provisions
(any unforeseen expenses);
• Ensure that funds are deployed optimally to ensure that the company does not run out of capital
or have any unnecessary surpluses at any given time.
The importance of financial planning is the financial planning process, which frameworks the
financial performance of a commitment, policy, procedure, program and budget. It ensures that
the financial and investment policies are effective and consistent. Ensure a reasonable balance
between cash outflow and cash inflow to maintain stability. It makes it easy for capital providers
to invest in financial planning firms. Create a variety of growth and development programs that
contribute to the long-term survival of the company. Financial planning helps to minimize
uncertainties that could hinder company growth, helping to ensure stability and profitability.
3.2 Setting objectives to achieve financial goals
Short term financial goals
The spectrum and time constraints of short-term financial aims are restricted. The organization's
short-term priorities are improving the competitiveness of business. The company can measure
the results by forwarding records, such as revenue, the amount of goods or job time. From there
the goals to be accomplished, whether they are not successful, can be set or maintained and
developed if they perform well.
Mid-term financial goals
The medium-term objective of the company is to reduce by about 19% in the four quarters of a
year the number of people leaving their employers. It relies greatly upon evidence from an
employee's evaluation of the work environment and employee interaction to see if this rate has
declined dramatically or not. This will make the company realize what it must do to maintain and
establish higher objectives. Company create the medium-term to schedule the development and
increase the sale revenues based on the short-term goals achieved. Medium-term planning
implements and procedures to ensure company can follow the schedule to achieve the long-term
goals.
Long-term financial goals
With the long-term goal of the organization to become a leader in the technology sector,
specifically to achieve the above long-term goal, the organization needs to have good data such

as revenue and profit increasing steadily, the working efficiency of employees is good and it is
important that the product quality is constantly improved to improve the needs of customers.
Consequently, these data can help the organization set further and more important goals. The
long-term goals which is formulated achieved the overall objectives of organization. Long-term
planning reacts to the competitive situation of the company in its social, economic and political
environment and develops strategies for adapting and influencing its position to achieve long-
term goals.
Business planning is an importance aspect of to support company developed sustainable long-
term growth. Starting with short term to support longer term will helps company design clearly
strategic planning and objectives when operating and expanding in business market. In
additionally, organization will gain the profits and success in the decision to make company
more reputation which is sustainable long-term growth of any organization.
3.3 Ethical financial management
Ethics are valued morally but they are supported by the legal consequences of not following
certain principles. The ethics of a financial manager should be approached above. This does not
only include acting honestly, mentally. It means setting boundaries that prevent professional and
personal interests from appearing in conflict with the interests of employers. The manager is
ethically responsible for protecting the trust of the employer and complying with the restrictions
of the law.
Business ethics is an indispensable part to make profits in a competitive environment, and is an
inevitable rule of all businesses that need to survive and develop sustainably. DOJI applies strong
workplace ethics to support sustainable growth in the long term. DOJI's ethical values are an
important factor in the ultimate success of the organization. In addition, a company may not
suffer the consequences of legal consequences for not following certain principles. DOJI applies
daily professional ethics in even the smallest financial management competencies. The Company
adheres to ethical principles for all of the organization's stakeholders, from employees, suppliers
to shareholders and finance directors, and strives to balance those needs throughout the
organization. Submit a decision at DOJI. Specifically, the ethics of a financial manager at DOJI
is to act honestly, up to the law.
DOJI has policies in place to increase awareness of employees' foundational values, principles of
conduct and work skills since the beginning of Masan integration. In addition, DOJI also trains

employees according to job needs and special career development plans for employees holding
key management positions and "spearhead" fields. Opportunities at DOJI are not available and
do not come easy for everyone that person is the result of serious, persistent and intelligent,
efficient work. The company has a policy of transparency in all business activities - production,
demonstrating the quality of integrity - transparency for all employees, maintaining.
Avoid unnecessary risks: Companies exist to make money primarily for their owners. Profit
making is the main objective. Short-term returns are often greater than long-term success.
Stakeholders tend to curb investment with no confidence in management and have negative
effects on growth. Institutional ethical policies say their money is at less risk to investors.
Avoid needless risks: There are companies which mainly make money for their shareholders.
Stakeholders prefer to curb investment without management trust and have a negative impact on
growth. Institutional ethics policies state that investors are less vulnerable to their capital.
Return on investment validation: ethical corporate practices will avoid legal disputes and harmful
consequences by finding ethical behaviour. This practices will also help companies return their
capital consistently, as they concentrate on effective and effective activities without the damage
that negative news and negligible market opinion do to firms.
Enhancing employee morality: Employees love to work in companies that deal with honesty,
respect and justice. If businesses set a high level of professional behaviour, workers are well
served. The customer is handled equally in exchange.
In businesses with long-term high customer retention, increased buyer loyalty, company repeat
and greater industry proportion are trendy. A customer can dismiss dealing with a suspect and
scary business. Enterprises who contribute to their society appear to be well off in the long run
with government departments and other enterprises.
IV Critically analyse the key financial management principles and their importance in
delivering effective financial strategies for long term financial sustainability.
The important of setting objectives to achieve financial goals

The financial planning process is focused around meeting the organization's objectives and
priorities. In order to be able to prepare for the future, companies need to decide when and when
they expect to be in the future. Fixing financial objectives is also very critical and the company
has to know the specifics as to where the objectives begin and finish. Financial targets are mid-
low, but they are not reached reliably. It's maybe your fear of the unknown, the lack of time, or
your failure to start. Documents which are still adjustable can be used as a financial objective.
They are going to change over time as things change. Some objectives may be easier to achieve
(short-term objectives) while others are harder to achieve (mid-term or long-term goals). When
financial goals have been set, priority can be attached to them. Consider financial objectives as
building and preserving a value which keeps organization afloat.
The important of Ethic financial management
It is ethically necessary and fast whether a company hires an outside financial manager or its
internal finance manager. Finance is money management and a set of books that give detailed
information on how companies make and spend their cash. It is ethically imperative to present
this information clearly and honestly if organizations use it to understand and improve their
operations. Whether or not a company assesses its performance and profitability or whether it is
reasonable to invest in future growth, incorporating such documents into a good ethical compass
will help keep the company informed. people who review them to make the best possible
decisions. Company partners and stakeholders have the right to find out if a company is making
or losing money and if they invest in a firm or wobbly foundation.
The important of primaty objective
The ultimate goal of financial management is to maximize shareholder wealth. Therefore, the
main purpose of a company, which is to maximize shareholder assets, is to focus on the interests
of its stakeholders.
For a company the customer is considered the most important factor because they are willing to
pay for their products and services, and the company has an obligation to satisfy product quality
satisfaction, Reasonable price and good service.

Employees are also needed for shareholder goals. They are key workers who directly create
outstanding value and are a potential source of significant competitive advantage. As a result,
they are trustworthy and will dedicate all of their skills and talents to the critical role of the board
and provide the best policies for employees, e.g. paying fair wages. , practice fair employment
and safe working conditions, education.
In addition, the benefit of society as a whole is an unpredictable factor that will create great value
for a company. The more social benefits a company contributes, the more that value creates for
its brand.
The suppliers will be stable and reliable partners if the Management Board treats them fairly and
reasonably. This is reflected in the application of all terms of the contract and the timely payment
of the invoices.
V. Critically evaluate the importance of key financial management priciples in suppporting
and delivering effective financial strategies for long term financial sustainability
The relationship between set objective, ethic management, primary goal: Setting goals helps the
organization to achieve each milestone and directly impacts the basic goals of the organization,
with each specific goal for each stage will help the organization step by step improve and
develop the organization. The organization achieves specific goals to ensure good financial
resources for the organization. Furthermore, ethical financial management also has a strong
influence on the main goals of the organization, with an ethical financial management process
meaning it helps the organization improve the organization's solidarity.
However, setting goals to achieve financial goals will not be the first choice if the business is in
need of improving and maintaining an ethical financial process, assuming that financial
management is morality. Assume that the business has stabilized its business in the market and
that the implementation of this plan is intended to maintain and make more decisions to improve
the organization's business.
In the case of direct market competition, fundamental objectives are necessary and considered
essential for the business to perform. Specifically, by maintaining relationships with stakeholders
including customers - is one of the factors that strongly impact the success of a business, so the
organization needs to build a relationship. and improve product quality to be able to bring
customer loyalty to the organization.

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