Financial Planning: Stakeholders, Theories, Teams, and Development

This report delves into the intricacies of financial planning, examining the roles of internal and external stakeholders such as managers, finance teams, government entities, and clients. It evaluates key financial planning theories, including agency theory and modern portfolio theory, considering their impact on stakeholder relationships and investment strategies. The report further analyzes the effectiveness of cross-functional teams, comparing them to traditional hierarchical structures and assessing management problems that arise in their formulation. It explores the critical elements required for resolving complex management challenges within these teams, such as top management support, organizational structure, team authority, performance reward systems, and team dynamics. Additionally, the report evaluates appropriate professional, ethical, social, and cultural behaviors for formulating cross-functional teams during financial planning, emphasizing the importance of stakeholder engagement and employee development techniques to achieve organizational objectives.

Task 1- Management theories and stakeholders
1.1 Two internal and two external stakeholders related to the process of financial planning
Examine three roles of stakeholders play in the process
Answer-
a) Internal stakeholders- managers and Finance team
b) External stakeholders- government and clients
c) Three Roles of each of the stakeholders
 Managers- The managers set the person to be involved in the finance planning
process. They find out how the progress of the financial planning and review
the whole process.
 Finance planner- The planner established and define the relationship with the
clients. He assists in collecting the information of the clients (Kazadi, Lievens
& Mahr, 2016). They develop financial planning recommendations for them
 Clients- They buy the services of the companies. They have the full power to
accept or reject the work. They negotiate, clarify as well as document the
specifications and the deliverables of the project.
 Government- The government wants the business and the process to pay the
accurate taxes and follow the laws. If they fail, the government could become
a major barrier for the planning process. They enforce the rules that the
company and the finance managers are bound to follow.
1.2 Evaluate the following theories of financial planning taking into account the roles of
stakeholders:
Answer-

a) Agency theory and financial planning- Agency theory is the theory that describes the
issues which takes place when one party represent another in the business but it holds
different views on the important issues and different interests from the principal (lin,
Chen & Long, 2017). It is used for defining the different types of relationships of the
stakeholders involved in a business.
b) Modern portfolio theory and financial planning- The Modern Portfolio Theory which
deals with investment and finance. It was developed by the Harry Markowitz in the
year 1952 (Calvo-Silvosa, Antelo & Soares, 2017). According to this theory, it is
possible for the stakeholders to design a portfolio for maximising the returns by
taking on a good amount of risk.
Task 2- Cross-functional teams and decision making
2.1 Using agency theory, evaluate the concept of cross functional teams. How financial
planning process can be improved by using cross functional teams compared to traditional
hierarchical structure
Answer- A cross-functional team refers to an agency that can take several forms (O’Leary et
al., 2017). These teams are formed on the basis of assumptions that state that the small groups
is better able for accomplishing a creative project than the individuals who are acting alone or
in large, well-structured groups. It is a group that has several people with several diverse
functional expertise working towards achieving a common goal. It might include people from
operations, finance, human resources, sales and any other department. According to Aime et
al. (2014), the cross functional teams improve the total quality of the result and the team
becomes highly committed to see the project throughout its end.
The traditional hierarchical structure is an organisational structure where power flows
upward and in vertical way. With the same, all the employees in this structure are

departmentalised. They follow a chain of command. Unlike, the cross-functional teams,
where individuals from different expertise and backgrounds are welcomed and work
collaboratively towards a common goal, in traditional hierarchical structure expertise from
different backgrounds are allocated to different departments (Lynch & West, 2017). Hence,
this has the possibility to slow down the functions of the finance planning process. For
example, if in finance planning, it is required to take approval on the purchase of new
supplies for meeting the requirement of the client, the planner or the other members involved
in the planning process needs to go up the chain of command for taking approval on the
transactions and any other necessary resources.
2.2 Evaluate two management problems that arise during formulation of cross functional
teams
Answer-
a) Uncertain structure of command- Both control and command are intrinsic elements in
the chain of command within any company. In cross functional teams, there are two
or more than two teams of fairly equal managers and associates (De Massis et al.,
2015). But it also holds a significant negative impact on the overall operation of the
work. If each of the members are given equal importance and equal power than there
is none who is in charge. In such cases, instead of associates and groups working
towards achieving a common goal, one get some competing groups who are vying for
the trainings, resources and proper guidance.
b) Sharing of the information and resources seems to be a one-way road- In a cross
functional teams, joint efforts are very important. A meeting of both the sides for
sharing resources and information in necessary (Bennett & James, 2017). But there
are times, when only one group seems to be controlling the entire agenda as well as

the distribution of the task among the other group members. With the same, it is
unwilling to spend ample of time to know and share their experiences and knowledge.
2.3 Evaluate the following elements of cross functional teams required for resolving
complex management challenges and problems to achieve organisational goals.
Answer-
Top management support- The top management team of a company is responsible for
controlling the decision making which influence everyone right from the president of the
company to the entry-level employees. It is to note that the financial decisions in a company
comes from the top management only. When the employees do not have access to the
resources and the equipment that are required for completing their jobs, then the achievement
of the company suffer and this finally results in conflicts. At this time, the top management
team supports the staffs by providing them resources and equipment to lead the success and
achieve organisational goals.
Organisational Structure- The structure of an organisation have a significant influence in the
employee performance. This in turn affect the achievement of organisational goals. It is the
organisational structure that defines how the tasks are distributed and grouped among the
employees. It is something that clarified the responsibilities and the roles of the
organisational members. Therefore, for ensuring that employees are working together
effectively and efficiently towards achieving the organisational goal, the structure of the
organisation, the structure of the company is very important be taken into consideration.
Team Authority or autonomy- Authority can be defined as the character of the
communication by means of which any order is accepted by a person as governing the act
which he or she taken within the very system. Team authority plays a significant role in
achieving the team goal and objectives. This team is comprised of independent workers who

regulate most of their task behaviour around the whole tasks. They coordinate and
communicate for transmitting all the necessary information for achieving the goal.
Performance reward system- The performance based rewards stress upon the organisational
goals and then foster the commitment to the team like their personal responsibility for the
progress of the work. This in turn enhanced the performance of the whole team as they get
motivation for working more effectively and gaining positive result. With the same, this
automatically results in the increase in likelihood of achieving the organisational goals and
objectives.
Team dynamics- Team dynamics can be defined as the driving or the motivating elements of
forces which propel a team towards achieving the organisational goals. Some of the effective
team dynamics include identifying a leader, establishing the roles and responsibilities and
discussing what every individual in the team brings in to the table, establishing a set of clear
objectives and goals to work on and developing an agenda for the management of the time for
completing the work or meeting. All these together contributes in the successful achievement
of the organisational goals and objectives.
2.4 Evaluate professionally, ethically, socially and culturally appropriate behaviour to
formulate cross-functional teams during financial planning
Answer-
a) Professionally appropriate behaviour- The professionally appropriate behaviour
towards formulating cross-functional teams during the financial planning include
showing compassion for the other people, responding properly to all the emotional
responses of the clients and their family members and demonstrating a sense of
respect, helping attitude and compassion for others.

b) Socially appropriate behaviour- The socially appropriate behaviour towards
formulating cross-functional teams during the financial planning include the
behaviours which the cross-functional team members emit in the social contexts for
making sure that there is integration with the other members of the team.
c) Ethically appropriate behaviour- The ethically appropriate behaviour towards
formulating cross-functional teams during the financial planning is the behaviour in
which the team members acts in manner that is consistent with what the clients and
the society thinks as good values. These behaviour tends to be good for the business
and also include the demonstration of respect for the important moral principles like
fairness, diversity, dignity, respect for individual rights and equality.
d) Culturally appropriate behaviour- Culture have a great influence on the consumption,
investment and saving decision making behaviour of the individuals as well as the
financial growth of the clients. The culturally appropriate behaviour towards
formulating cross-functional teams during the financial planning include considering
the educational levels of the clients, their geographical areas and their socioeconomic
status.
Task 3- Stakeholder participants, self and organisational development
3.1 Identify four internal and four external stakeholders for financial planning process
Answer- The four internal stakeholders include-
a) the internal staffs,
b) the managers,
c) the finance team and
d) the board members
The four external stakeholders include-

a) the clients
b) governments
c) community partners
d) suppliers
3.2 Developing management plan for resolving real world complex challenges with respect
to chosen above internal and external stakeholders
Answer-
Management Plan
e) Professional- showing compassion for the other people, responding properly to all the
emotional responses of the clients and their family members and demonstrating a
sense of respect, helping attitude and compassion for others.
a) Ethical- Showing behaviour in which the team members acts in manner that is
consistent with what the clients and the society thinks as good values. These
behaviour should good for the business and also include the demonstration of respect
for the important moral principles like fairness, diversity, dignity, respect for
individual rights and equality.
f) Cultural- Showing behaviour that is appropriate and taking into consideration the
educational levels of the clients, their geographical areas and their socioeconomic
status.
b) Social- Formulating a cross-functional teams during the financial planning include the
behaviours which the cross-functional team members emit in the social contexts for
making sure that there is integration with the other members of the team.
c) Making relationship with the identifies stakeholders-

a. Understanding the stakeholders. There are several projects that get delayed
and end up in not delivering the value that they promised or the things that
they committed because of the failure of project manager in identifying and
engaging all the stakeholders. It simply means that important requirements,
needs and insights are been missed.
b. Identifying the stakeholders with high level of power and influence- while
leading a large project, one would not be able to spend equal span of time with
each and every engaged stakeholder of the project. Naturally, he will have to
engage and learn about every person that he have identified, but the people
whom he need to concentrate his efforts on are the ones who possess the most
power and influence.
c. Getting engaged in one to one conversation- Building strong bond and
relationships is not about the amount of time that one spend with someone, but
it is all about the quality of the time that he spends. Like, for instance it is
often seen that a person do not know how many people he is interacting with
in meetings without knowing much about them. It is to note that great
relationships are built on the basis of one-to-one conversations where he or she
can find out more about the person. Stakeholders are usually very busy people,
therefore, respecting their time by keeping the discussions as short as possible
is very important.
3.3 Evaluate and apply three techniques used by business organisations to develop and
motivate employees in the financial planning process
Answer-

a) Creating a positive working environment for the team- Motivating the employees in
the financial planning process by offering them positive and productive working
environment is the key to success. It encourages and foster teamwork and idea
sharing. With the same, elimination of conflicts when it takes place and giving the
employees the freedom for working independently whenever it is appropriate is also
very important.
b) Providing professional enrichment- Encouraging the members involved in the
financial planning process for pursuing additional training, education and
participating in the company is significant to motivate and encourage these
employees. Providing them with proper development programs and sending them to
skills workshops and different seminars also motivate and encourage them.
c) Recognising the achievements- Recognising achievements of each and every
employee is very necessary for motivating any employee in any business context.
Celebrating their achievements by means of employee-of-the-month or any awards
and recognition like star performer of the month or year helps a lot. It also involves
printing certificates and engraving plaques.
3.4 Examine how two techniques identified improves employee engagement and
productivity
Answer-
a) Professional enrichment- The professional enrichment programs such as the training
and development programs, workshops and seminars allow the employees to gain
more knowledge and develop more skills on their departments. These training
programs is completely focused on the level of employee engagement. It aids to the
application of the different concepts of employee engagement along with the different

activities. It is to note that the employee engagement has a notable influence on an
financial outcome of the organisation. There are several organizations who designed
the professional development training programs by targeting at enhancing the
engagement skills of the leaders so as to affect the arena. There are many studies
which have showed that there is a great importance of professional development
training programs that are especially designed for including the engagement training
for affecting the behavioural changes. With the same, there are many organizational
leaders who depended on workplace learning for improving the employee engagement
by means of designing and developing specific engagement programs for their
employees in the supervisory positions.
b) Creating a positive working environment for the team- According to Anitha (2014),
work place environment has a great impact on the overall performance and the level
of engagement of the employees. Hence, producing a workplace environment that is
conducive to employee engagement is the key to success. Hence, employee should
consider the employee engagement as a business strategy which focuses on finding
out the engaged employees and then, keeping those employees engaged all through
the entire relationship of the employment.
3.5 Evaluate and apply any two personal goals of employees required for self-development
and improvement
Answer-
a) Personal goal 1- To improve and enhance the ability of managing time- In any
workplace, employees face deadlines and order which keep on screaming their
attention each and every day. As those works continue to pile up, the time to have
each and everything doe time looks like a very scarce commodity. In such as

condition, managing time management is a skill to success. It is to note that the sense
of time consciousness comes with a huge array of benefits. It helps the employees in
becoming more and more efficient and productive at the workplace. With the same,
they are then less stressed. For improving the ability of managing time and keeping a
track on how to spend the time at right place is very important for each and every
employees. They must kill the activities which cause distractions and disturbance such
as going repeatedly on social media sites.
b) Personal goal 2- To build and improve the relationships with the co-workers at the
workplace- The next goal is of building and improving the relationships with the co-
workers at the workplace. It is to mention that good relation in the workplace is very
beneficial in running of a business in different ways. It helps in harnessing high
performing teams and also in encouraging support among one another. With the same,
it gives every employees in the institution with a sense of belonging. However, it is
also to mention that for improving the relationship of the employees with the co-
workers or their peers, it is very necessary to practise being friendly, likable and
helpful to them. It makes it very easy for the other employees to accept him or her.
3.6 Two organisational goals for achieving effective financial planning process for
increased organisational effectiveness.
Answer-
a) Organisational goal 1- To focus on growth and education – Organisational leadership
needs a productive and active measures for working with the several different
individuals and groups (Bryson, 2018). It is therefore, very important for the leaders
to understand the weaknesses and the strengths of the different professionals prior to
making any plan of action for improving the organisational effectiveness. Hence,

before making any sort of changes to the organisation, it is very important to consider
the professionals’ education in several different areas of the business. After
identifying the strengths and the weaknesses of these professionals who have different
educational backgrounds, the leaders must focus on the growth and development of
the organisation itself by building an effective teams. He should also try to develop
the teams with some complementary strengths and skills. Furthermore, they should
encourage the professionals towards a particular goal and give them proper
assignments on the basis of their skills and knowledge.
b) Organisational goal 2- Working on quality products and services- Although customers
play a very important part in the effectiveness of the organisation, therefore, it is very
necessary for every business to identify a proper level of quality for the services and
the products that they are offering to them (Burke & Noumair, 2015). The key to this
is focusing on the balance of quality with some cost effective solutions. It is to note
that the cost of any business should be improving and enhancing the quality of the
products and the services without exceeding the price range. Moreover, the
organisational leadership needs a very active participation in the process of decision
making. The leader should ask the professionals in different areas of the business for
their advices on the topic or issue of improving and enhancing the quality of products
without increasing the prince of that materials. They should seek for their suggestions
in reducing the time that is usually required for the accomplishment of the specific
goals without cutting back on the quality of the final product and the service. It is also
to mention that by involving different professionals from multiple fields in the
decision-making process, a leader gains multiple perspectives and ideas about better
ways to improve the organization.