|
Finance is the core of any business. There simply isn’t any other way of putting it. After all, how is anyone supposed to run a business, without knowing how much profit he is making, how much of those profits are being invested to run everyday processes, the true scope of the business policies of his company and so on? Only then can he expect to be able to devise new strategies to multiply profits as and when needed. I learned this from my faculty the very day I enrolled for my full time MBA and chose to focus on studying concepts of financial management and international business economics as thoroughly as possible, from then on. Through my studies, I learned about the silent revolution that is going on in the world of business management, especially in fields directly related to finance. The functions of financial managers are fast changing, new investment techniques are popping up and new technologies are changing the way the management solves problems. That’s when I wondered why the news had received little attention from most international business organisations. Well, through further research, I have arrived at the following conclusions. Most major international business organisations are not ready to accept it yet This reaction of international business organisations towards this new revolution came to me as no surprise. After all, any major revolution goes ignored by most of the world in the early stages, mostly because people are fundamentally resistant towards new practices, especially the ones that threaten to completely change the system of doing something. Even Copernicus and Galileo were shunned by the majority of learned people in their societies, because their ideas were about to bring a revolution to the field of astronomy. Most companies still refuse to accept that buyers rule the market completely now True, companies still decide which products they would bring to customers. However, at the end of the day, they now need to know exactly what can catch customers’ fancy. Otherwise, their products may serve little purpose other than adorning supermarket shelves for a few weeks, before those are sent back. Market research around consumer behaviour is what companies need to do now, before they start planning about launching the next big product. In emerging markets like India, importance of this task is much higher, since consumers have limited amounts of money in hand and know exactly what they want to invest in. Companies like to believe that traditional management principles still work great This is actually a dangerous thought pattern, especially if the company is a major player in the field of online retail. There might be hundreds of suppliers, each with unique requirements and demands, bringing in products or raw materials to keep the production cycles active. Managing all those little problems, managing financial securities as well as carrying out proper accounting and analysis of business processes is no longer something that can be carried out successfully through conventional management practices. Different management teams need to be formed, each with its own responsibilities, so that the processes can at least be split up and assigned to teams best suited for handling those. These are just three of the many processes I have learned about, which are likely to bring in a major revolution in the world of business, especially financial management. In the coming days, I shall wait to see how much these emerging trends can influence the way major companies across the globe do business. Arindom is a final year student of MBA at IIM Calcutta, one of the premier business schools in India. In his spare time, he conducts personal research on latest developments being made in various industry sectors, especially in the fields of financial management.
Related Articles -
financial management, international business,
|
