Question

Explain financial strategies that you would advise a mature company to adopt

Answer 1

Financial strategies can help a firm in effectively managing its business and beat competition within the industry overtime. Some of the main financial strategies that can be recommended to a grown up company are as follows:

• Budgeting: No matter, how big a company may become, it is highly essential that proper budgeting techniques are followed while preparing the expenses and cost sheet of the company. If a company will not form a proper budget for its cost and revenue, it will end up overspending and may sometime underestimate itself, which will result in inability to meet the demands. Therefore budgeting is highly essential for a grown up company.
• Cash flow management: The most important thing in a business is its cash flow. If cash flow of a company is properly channelized into productive activities, it can do wonders for the business. The management should have proper strategy to manage its cash flows in the right direction, so that business growth can be achieved over period of time.
• Risk management: Business operates in a dynamic environment, the external environment is quite risky and dynamic which is changing on a constant basis. The management of the company should be aware of the potential financial and economical risk that surrounds it and shall frame a proper strategy to overcome such risk in an effective manner.
• Human resource management: Human resource is, perhaps, the most important resource that an organization can have, it helps the company in building its reputation and image within the market. It also helps company in beating the competition and evolving as a mature and growing company. Various aspects of human resources like, health and safety, bonuses, training and development etc. should be taken care of, for this proper human resource management strategy should be used.