Importance of Work-Life Flexibility

Human Resource Management

Work Life Balance and Wellness in Organizations

Human Resource Management

What is Work Life Flexibility?

Modern Management Concepts

The Relevance of Stakeholder Management in International Business Context

International Business

Why Business Models Matter in Business?

Modern Management Concepts

Adjusted Book Value Method of Corporate Valuation

In recent years, management consulting firms have started offering companies advice on how to increase value. This has been possible because of the fear of hostile takeovers. Companies have increasingly turned to “value consultants” to tell them how to restructure, increase value, and avoid being taken over. The consultants suggestions have often provided the basis for the restructuring of these firms. The value of a firm can be directly related to decisions that it makes: on which projects it takes, on how it finances them, and on its dividend policy. Understanding this relationship is key to making value increasing decisions and to sensible financial restructuring. Adjusted Book Value Approach to Corporate Valuation The adjusted book value method of corporate valuation  involves estimation of the market value of the assets and liabilities of the firm as a going concern. It is a pointer to the liquidation value of the firm. It Continue reading

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ABC System of Inventory Control

Inventories include raw material inventory, work-in process inventory and finished goods inventory. The goal of effective inventory management is to minimize the total costs – direct and indirect – that are associated with holding inventories. However, the importance of inventory management to the company depends upon the extent of investment in inventory. It is industry-specific. In the case of a manufacturing company of reasonable size the number of items of inventory runs into hundreds, if not more. From the point of view of monitoring information for inventory control, it becomes extremely difficult to consider each one of these items. The ABC analysis comes in quite handy and enables the management to concentrate attention and keep a close watch on a relatively less number of items which account for a high percentage of the value of annual usage of all items of inventory. The ABC System of Inventory Control  is based Continue reading

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Organisation Structure – Meaning and Types

An organisation structure is a set of planned relationships between groups of related functions and between physical factors and personnel required for the performance of the functions. The organisation structure is generally shown on the organisation chart. It shows authority and responsibility between various positions in the enterprises by showing who reports to whom. Organisation structure lays down the pattern of communication and coordination in the enterprises. Though organisation structure is very important, it is not an end in itself. According to Peter F. Drucker, “Organisation is not an end itself, but a means to end of business performances and business results. Organisation structure is an indispensable means; and the wrong structure will seriously impair business performance and may even destroy it. Organisation structure must be designed so as to make possible the attainment of the objectives of the business for five, ten, fifteen years hence.” Process of Organizing Organisation Continue reading

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Types of Motivation Theories

Motivation is defined as a general term for any part of the hypothetical psychological process which involves the experiencing of needs and drives and the behavior that leads to the goal which satisfies them. In essence, the motivational theories provide explanations as to why people behave the way they do.  These diverse motivation theories helped identify and determine the myriad of factors that drive people to behave in particular ways. There are numerous motivation theories with more than one may of grouping or classifying them. However, the most common one is to classify them according to four general types, namely: need theory; expectancy theory; equity theory; and goal setting theory. These are considered as the formal motivation theories. 1. Need Theories Need theories buttress the assumption that people have psychological needs arising out of, though going far beyond, basic biological drives like hunger, thirst, sex or the avoidance of pain. Continue reading

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How Interest Rates Can Influence Financial Decisions?

Interest rates exert the following economic influences. Interest rates in a country influence the foreign exchange value of the country’s currency. Interest rates act as a guide to the return that a company’s shareholders might want, and changes in market interest rates will affect share prices. A positive real rate of interest enhances an investor’s real wealth to the income he earns from his investments. However, when interest rates go up or down, perhaps due to a rise or fall in the rate of inflation, there will also be a potential capital loss or gain for the investor. In other words, the market value of interest-bearing securities will alter. Market values will fall when interest rates go up and vice versa. Interest Rates are Important for Financial Decisions by Companies Interest rate is important for financial decisions by companies. The incidence of the interest rates can have the following effects. Continue reading

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Concept of Goal Congruence

Goal congruence is the term which describes the situation when the goals of different interest groups coincide. A way of helping to achieve goal congruence between shareholders and managers is by the introduction of carefully designed remuneration packages for managers which would motivate managers to take decisions which were consistent with the objectives of the shareholders. Agency theory sees employees of businesses, including managers, as individuals, each with his or her own objectives. Within a department of a business, there are departmental objectives. If achieving these various objectives also leads to the achievement of the objectives of the organization as a whole, there is said to be goal congruence. Achieving Goal Congruence Goal congruence can be achieved, and at the same time, the ‘agency problem’ can be dealt with, providing managers with incentives which are related to profits or share price, or other factors such as: Pay or bonuses related Continue reading

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