In any size organization, it could be difficult to implement changes. More specifically, when a large company such as Wal-Mart decides to make major changes it requires a coordinated, multi-functional effort to succeed. To help Wal-Mart implement the changes it desires, strategic initiatives are put into place to guide them toward both their short and long-term financial goals, such as increasing profit margins via pricing strategies and boosting their production processes ensuring the selling of quality products. In this paper, Team A will discuss the relationship between strategic and financial planning, how these initiatives affect Wal-Mart’s financial planning, and the risks associated with them.
Relationship Between Strategic and Financial Planning
Wal-Mart Inc. understands that their success is due-in-part to planning. The two types of planning they use are strategic and financial planning. These two methods focus on different objectives; yet, they have two major links that impact how managers approach the planning process. Strategic planning is “The process of determining a company's long-term goals and then identifying the best approach for achieving those goals” (WebFinance, 2012). Financial planning is described as “the process of estimating the capital required and determining its competition. It is the process of framing financial policies in relation to procurement, investment and administration of funds of an enterprise” (Management Study Guide, 2012).
The relationship between the two both involves defining objectives, gathering and analyzing the data, implementing plans, and monitoring the results. The two strategies rely on money. Without a sufficient amount of money to implement the change, the intended goal will not be reached. It takes money to run a business successfully. Another link to the two is when the strategic planning is implemented and the business is on its way, it causes an increase in revenue and a... [continues]
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