Business Management and Strategic Planning

Modern businesses operate in very complex and sophisticated environments. Managing various and multi-faceted internal activities is only part of modern management's responsibilities — a firm's immediate external environment poses another set of challenging factors, and analysis of these environmental factors is critical for the long-term success of the business.

Under strategic planning, we critically examine the impact of the following factors on the business:

• Impact of competitors on the business.
• Bargaining power of suppliers.
• Bargaining power of customers.
• Effect of government policies.
• Economic, political, social and technological environments under which the business operates.

Financial management is designed to help maximise the value of a firm. Value is determined, in the long run, by results as revealed in financial statements, and the focus is on how current decisions affect future financial statements. Finance functions include investment or long-term asset-mix decisions, financing or capital-mix decisions, dividend or profit allocation decisions, and liquidity or short-term asset-mix decisions.

A business firm performs finance functions simultaneously and continuously in the normal course of business. They do not necessarily occur in sequence, and as such finance functions require skilful planning, control and execution of a business's activities.