1. Wahid’s view- The cogent task and the confront of financial/economic analysis in the
modern business decision making
Summary: Wahid’s view discussed about disciplined reflecting on and evaluating the
financial /Economic analysis capability to business decision making and to make sure that
financial /Economic analysis are providing on effective and appropriate support to
clients. Financial /Economic analysis capability meets professional standards and
identified any improvement or development in current business situation
Wahid’s view explained the task of financial / economic analysis, a financial / economic
analysis could help to understand the managers how corporate value and shareholder
value may be increased through the use of appropriate financial strategies, including
mergers and acquisitions, and restructuring and reorganizations.
Author Remarks: Wahid’s view is the special and helpful article, as financial analysis. I
have explained a new method in this article from my point of view. That how to apply
effective- informal and formal ways of regularity and fairly monitoring the progress &
quality apply by financial /economic analysis on the basis the standards or level of
expected business development,
This Wahid’s view closely related to and directly determined by the method. How the
financial /economic analysis should performed. & how to expressed in a business plan or
strategy that need to execute the company object, financial /economic analyst need to
investigate the current performance of their business and identify their business needs,
this engages introducing them to a new and more powerful tools and method. Modern
business decision making
Introduction: The financial/economic analysis support and used by the economic manager
can be viewed within a broad hierarchy of decision-making needs. In the traditional
business where financial/economic analysis is a necessary component. This theoretical
pyramid respites on the broadest area: day-to-day decisions and operational planning. It
successively rises via
01. Strategy planning improvement
02. Performance review and Incentives
03. Judgment and sponsor contact
Above all of these areas controls deal and issues in the capable to apply of analysis and
challenging business decision-making,
Financial /Economic analysis Capability: Financial/ Economic analysis from the
perspective of project owners (involving assessment of the project entities’ financial
statements) is common. For all irrigation projects, financial analysis was undertaken
from the point of view of project beneficiaries through farm budget analysis.
the economic/ Financial analysis are used as the primary input to the initial decision-
making process on whether or not to continue with consideration of the project. Only

2. when a project appears to be economically efficient from the viewpoint of the society, is
a more detailed financial analysis conducted to ensure that the project is also financially
viable (. that the financial returns for the various classes of financing are sufficient to
compensate for the risks to which investors will be exposed).
A project’s net economic benefits are measured as the difference in economic
efficiency that is expected to emerge, in the economy as a whole, with the project
compared to that without the project. The implementation of a large project typically
involves the use of significant amounts of limited economic resources. An economic/
financial analysis investigates whether or not the use of these resources, at a particular
point in time, in the project is expected to reap greater benefits to society than their
use in alternative applications
Decision of operational planning: One of the most important areas of applying basic
financial/economic analysis is the support of day-to-day decisions made by managers and
employees. I am discussion in this article about the operational part of the project, in
which calculated direction and prepared plans are translated into accomplishment.
Although its importance, analytical apply in this area often tends to be the least
developed, because the demands of daily activities foreshortens the time for reflective
thinking about operational issues and trade. Decision of operational planning is typically
the operating or fiscal year of the company. The plan will recite the Overall goals of the
company for the year then break those down into the individual goals and action items
that each department must achieve or accomplish in order for the company as a whole to
meet its goals. Further, for a plan to be effective
The operational planning related the budget, the operating plan is usually the joint
effort of every department in the company, coordinated by the Finance and/or Planning
Department, and each department head will have participated in the planning process by
writing the goals that his or her department will achieve during the plan year. The
operating plan may outline the goals and targets of each major unit within the company,
the P&L budget for the year, and a budget of planned capital expenditures. In addition,
subsections of the plan may be devoted to individual departments
Without such guidance, non- financial / economic and damaging choices such as spending
funds because there’s room in the budget or in the allowable head count become decision
criteria. Operational effectiveness should be a function of sound trade-offs, with
careful cost management and close attention paid to the quality and efficiency of
production or services rendered, and with constant vigilance in serving customers
through sustainable pricing, credit, and support actions. Therefore the successful
company will have a financial/ economic analysis that clearly supports quick business
decision-making.
The following view will help business decision-making all of these areas to understand
what should be covered in each of these segments
01. STRATEGY PLANNING IMPROVEMENT:

3. What is Strategy Planning?
Strategy planning establishes where an organization is going over the next year or more,
how it's going to get there and how it'll know if it got there or not. The center of a
strategy plan is usually on the entire organization, while the center of a business plan is
usually on a particular product, service or program.
There are a variety of perspectives, models and approaches used in strategic planning.
The way that a strategic plan is developed depends on the nature of the organization's
leadership, culture of the organization, complexity of the organization's environment,
size of the organization, expertise of planners, etc. like
1. Goals-based planning is probably the most common and starts with center on the
organization's mission. Goals to work toward the mission, strategies to achieve the goals,
and action planning
2. Issues-based strategy planning often starts by examining issues facing the
organization, strategies to address those issues and action plans.
3. Organic strategic planning might start by articulating the organization's vision and
values,
Some plans are scoped to one year, many to three years, and some to five to ten years
into the future. Some plans include only top-level information and no action plans. Some
plans are five to eight pages long, while others can be considerably longer.
Also, in addition to the range of the organization, differences in how organizations carry
out the planning activities are more of a matter of the nature of the participants in the
organization than its for-profit/nonprofit status.
Benefits of Strategy Planning
Strategy planning serves a variety of purposes in organizations, including to:
1. Clearly define the purpose of the organization and to establish rational goals and
objectives constant with that mission in a clear time frame within the organization’s
capacity for achievement.
2. Communicate those goals and objectives to the organization’s constituents.
3. Develop a sense of ownership of the plan.
4. Ensure the most successful use is made of the organization’s possessions by focusing
the possessions on the key priorities.
5. Provide a base from which progress can be measured and establish a method for
informed change when needed.
6. Listen to everyone’s opinions in order to make agreement about where the
organization is going.
Why Take Time to Plan?
Every organization with a goal in mind will expand a plan to achieve targets. Every
manager with a job to do will expand a plan to get his or her daily work done. Yet, for

4. the most piece, these plans are informal, a lot people only carry them around in their
minds and draw them out as needed, improvising and modifying along the way.
Most of the people don’t think of themselves as planners and yet they plan every day,
either formally or informally. plan pretty much for the best motivations because planning
helps to reach organizations goals, whether the goals relate to getting our daily work
done, laying out the annual family leave, or financing retirement lifestyle.
02. PERFORMANCE REVIEW AND INCENTIVES:
The main concern in this area is the relevance of the measures to the goals set, and the
need to establish not only indicators of deviation from desired norms, but also to
interpret these indicators so they can be used to highlight value creation. It’s an area
where the quality of the concepts and tools employed varies widely in both established
and new companies.
A project’s net economic benefits are measured as the difference in economic
efficiency that is expected to emerge, in the economy as a whole, with the project
compared to that without the project. The implementation of a large project typically
involves the use of significant amounts of scarce economic resources. A financial
/economic analysis investigates whether or not the use of these resources, at a
particular point in time, in the project is expected to reap greater benefits to society
than their use in alternative applications
Even when a project is financed by the private sector, where significant indirect costs,
benefits and impacts exist a project is usually evaluated from an economic perspective
(from the viewpoint of society), as well as from a financial point of view. The constant-
year annual cash flow profiles that were computed in the initial financial analysis are
modified for use in the economic analysis. Taxes and subsidies are eliminated since they
do not represent a use of resources but are simply transfers within the economy; costs
and benefits that are external to the project are included; and costs and benefits, both
internal and external, are adjusted to reflect their opportunity values by applying
“shadow” prices., in an economic analysis, market prices should be adjusted to reflect
economic costs.
Above I have discussed my view of financial /economic analysis ability, area and
responsibility that more effective to judgment the organizations Performance review
and Incentives situation, although I have presented the following information to
understand the reader and learner for financial / economic analysis task for provide
Performance assessment
If the bearing of measures employed has not been clearly established in an organization,
performance data can be meaningless, or subject to manipulation. “Gaming” the budget
or the business plan is an ever-present temptation. The tools for analysis, and the
judgments required for interpreting performance vary widely, whether one measures
performance from outside the business, which is the task of investors, creditors, and
suppliers, or internally, which is a necessary function of managing the various levels and
segments of a company. One of the critical challenges in evaluating the performance of a
business from the outside is to interpret the results as expressed in financial

5. statements. These are the most readily available data for publicly held companies. But
the various ratios and measures that can be applied to this information are subject to
limitations inherent in the financial accounting process and to a number of choices
management has in applying its rules and thus “managing” the reported results.
A vast range of statistical data can be used to measure effectiveness of operations,
many of which are physical in nature, such as output data, failure rates, yields, customer
contact frequencies, timeliness information, and project completions. Intangible data
such as customer satisfaction, employee attitudes, and community feedback are
important supplements. The point we’re making is that financial performance begins with
the roots of operational activity, and evaluating financial ratios and measures must rest
on an understanding of these activity-based indicators.
There has been a secure evolution in these processes, in similar with a better
understanding of the economic dynamics of the securities markets Incentives to
enhance short- and long-term performance are the opposite side of the performance
evaluation challenge I have just discussed. That won’t to deal directly with the complex
issues of designing incentive programs, as this is a subject deserving full treatment by
itself.
The higher the level of management, the more emphasis should be given to long-term
cash flow generation, to avoid the temptation for making short-term trade-offs that
damage long run value creation. Finally, there is the always present issue of how high to
set the standard to ensure some degree of excellence and significant effort, without
making the incentive unachievable. In short, incentives represent a form of using
financial/economic analysis heavily overlaid not only with challenges of interpretation
but of human motivation and proper rewards.
03. JUDGMENT AND SPONSOR CONTACT:
The most integrative aspect of financial/economic analysis is the area of valuation and
investor communication. It is here that some of the most complex tools and
methodologies are commonly employed, and it’s also the area where much of the
theoretical and observed research of the past, As I’ll discuss in the final chapters,
valuation is a function of the expectations held by the company’s existing and potential
investors, and by the securities markets in general.
The first point of analysis described Judgment and sponsor contact information
requirements and provides important new information on the extent to which non-
financial data influence the investment decision on aggregate. Most importantly,
however, this stage of analysis offers justification for the more detailed modeling
required in the second stage of the analysis As described above, this second stage of
work relies upon the data compiled from the experimental investment simulations
The investigators were able to estimate the amount of influence each financial and each
non-financial characteristic had on the investment decision
I again am faced with a systems view of financial/economic analysis at the highest level,
which integrates the insights about all aspects of the business under review. The
external communication challenge similarly requires a systems view of the company’s

6. performance and prospects. In both the analytical and communications areas a fully
integrated approach is still lacking in the majority of corporate situations, the
rediscovery of basic economics is coming none too soon for this important area of
analysis.
Conclusion: as my article” Wahid’s view- The cogent task and the confront of
financial/economic analysis in the modern business decision making” I have describe how
financial/economic analysis will help on organization managers in support of more
informed and therefore better business decision making ,
Business planning is a systematic and formalized approach to accomplishing the planning,
coordinating, and control responsibilities of management. It involves the development
and application of long-range objectives for the enterprise; specific goals to be
attained; long-range profits plans stated in broad terms; adequate directions for
formulating annual, detailed budgets, defining responsibility centers, and establishing
control mechanisms; and evaluative methods and procedures for making changes when
necessary.
I think I have made my readers understand that the financial/ economic analysis is
generally more capable to develop the business decision making, also support to qualify
internal staff or outside advice,