More elements could be added, depending on the size and industry of the project. When making a financial strategy, financial managers need to include the following basic elements. Often it is a plan for one year but more typically 3 to 5 years if a longer term view is taken.Ĭomponent of a financial strategy Some techniques used in strategic planning includes: SWOT analysis, PEST analysis, STEER analysis. This led to decision making and allocation of resources inline with this strategy. Strategic planning is an organisation’s process to outlining and defining its strategy, direction it is going.
4 Strategic financial management tasks and services provided.3.3 Liquidity and working capital decisions.3.1.2 Short term assets investment decisions.3.1.1 Long term assets: capital budgeting investment decisions.To satisfy this objective a company requires a "long term course of action" and this is where strategy fits in. The objective of the Financial Management is the maximisation of shareholders wealth. These all have financial implications for the financial managers of an organisation. This includes different parts of the business plan, for example marketing and sales plan, production plan, personnel plan, capital expenditure, etc.
Therefore, Strategic Financial Management are those aspect of the overall plan of the organisation that concerns financial managers. Which is something that is done as part of a plan that is meant to achieve a particular purpose. To understand what strategic financial management is about, we must first understand what is meant by the term "Strategic". Financial management is nowadays increasingly referred to as "Strategic Financial Management" so as to give it an increased frame of reference. Strategic financial management is the study of finance with a long term view considering the strategic goals of the enterprise.
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