Advantages and Disadvantages of Effective Budget Control

Advantages and Disadvantages of Effective Budget Control This paper will look at what is required of an effective budgetary control mechanism and try to assess the advantages and disadvantages of using a system imposed from above, or externally, over a decentralized system controlled by lower level management as task level. Using an empirical case study from the international banking sector, it will be shown that too much managerial autonomy can lead to disaster not just for the manager concerned but also for the whole organization. In contrast the role of the World Bank and International Monetary Fund in imposing nation-state loan budgets will be critiqued to highlight the potential flaws of centralizing and dominating budget control management. Effective budgetary control Henderson (2003) notes that regardless of the situation or workplace, in order to be effective it is crucial that budgetary control systems: Account for money received and spent Make sure that the organization’s financial policies are adhered to Ensure that m oney is not wasted Assist managers to run, and develop, services or departments These controls have developed from the need to account for large sums of money but are equally applicable to any budgetary situation. However, from a managerial perspective they have often been criticised for being insensitive and restrictive at the lower levels of management. As the number of stakeholders increases so does the need to be fully accountable and therefore more controls are also needed. This is particularly noticeable in the public sector National Health Service. Here lower level management are extremely subservient to imposed and tight budgeting restrictions from a distantly senior level. This is arguably a result of the need to satisfy a multitude of stakeholder interests and a concern that empowering lower management with the autonomy to control their own budgets would fail to include the number of interested parties from politicians to doctors and patients. With organisations as comple x as the NHS whether public or private sector – It is safer and easier to plan and control from above using imposed budget control methods. Politically imposed budgeting is preferably because senior managers, directors, or institutions who set the budgets are arguably best placed to recognise the wider implications of budgeting decisions but, according to Marginson (1999), financially imposed budget controls make sense too. Financial losses, which can occur for such damaging reasons as incompetence, error, negligence or fraud, are most likely to be minimised, or avoided altogether, by well constructed control systems. Imposed budgets benefit from the experience, acquired knowledge and full backing of senior management. They arguably encourage a sense of confidence in lower level management to do their job whilst reducing the massive levels of stress that come with having to create and manage your own budget. Another advantage of imposed budgeting is that it encourages regular monitoring, reporting, progress reports and ultimately improvements in the budgetary system. This enables problems to be uncovered and dealt with quickly and efficiently. Henderson (2003) states that it is advantageous to review arrangements occasionally. Even if procedures within your work area operate well, you should ensure that the budgetary responsibilities of staff at all levels are clear and understood by everyone. It would be unfortunate if problems arise because people do not know the extent or limit of their responsibilities (p33).

Business Plan for Indian Restaurant - Pearls Valley Restaurant Case Study

Business Plan for Indian Restaurant - Pearls Valley Restaurant - Case Study Example Considering the overall nature of the business, our new proposed business will be a sole propertiership and as such the business, as well as the owner, will remain the same person. A sole proper internship is also called sole trader in which all assets and liabilities of the business are the personal liabilities of the owners. A sole proprietorship will be easier to formulate with lesser legal complications as well as fewer regulations to follow. This makes the sole proprietorship a better and more manageable option to exercise for the achievement of overall intended objectives. It is also important to understand that a sole proprietorship is relatively easier to manage and the owner can take charge of many important issues himself with fewer expenses. The proposed name of our new business is Pearls Valley Restaurant which will be an Indian restaurant catering to the needs of Indian and Pakistani customers. Starting a new business is always a challenging task and requires considerable effort and investment to successful start the business. This, therefore, means that the entrepreneurs must not only put in their skills and efforts but also invest the required funds to initiate a successful business. What is also, however, critical to understand that in order to open the new business, it is important that a comprehensive preparation must be done so as to cover as much as ground as possible in order to cover the risks. The proposed name of our new business is Pearls Valley Restaurant which will be an Indian restaurant catering to the needs of Indian and Pakistani customers. This will be a small restaurant and as such the overall organizational structure of the proposed will be simple with owners managing the affairs of the business with relatively smaller input/help from employees involved in managerial activities.

Integrated Marketing Communications Report Essay - 1

Integrated Marketing Communications Report - Essay Example ting activities combined together perform at a single platform, forming a synergy, whose supplemented energy energizes the organization on the whole – it is all about streamlining marketing activities and all activities moving in the one single direction i.e. the goal or the objective of the organization on the whole or as a single marketing unit as the case may be. This concept has gained significant importance particularly since the time when media started to grow, and from a newspaper to radios and from radios to a single state owned television channel and thereon the multiple growth of the various media and media houses; this trend has led organizations into adopting various channels for their advertisements, so it became very important for these channels to have a synergized message i.e. consistency in the message and in the form that the message is being conveyed. Today, television advertisements are the fundamental set of acts, from which, media houses derive newspaper advertisement, radio advertisements, and so on. And all this is done to convey to the customer one single message i.e. the product being developed and sold is a useful one for them, but competition does not allow this; it attempts at retaining the customer base. The sole terminology that keeps an organization or a business alive in today’s competitive arena is ‘innovation’. More often than not, today, innovation is derived by the customer expectations and values that the customer associate with the planners and strategic think-tanks that formulate a new product launch. Innovation has really been the path-way and concluding a product that the customers expect and want has been the key to this path way. There are many ways and means by which firms analyze and realize the products that the customers expect from them. Once these are developed and created, the uphill task comes in creating the awareness about the product, thereby making the customers aware of the fact that these are the