Within the organization, the different functions compete for the resources. Organizations have to adopt certain financial strategies in order for it to optimize resources that are available for use (Sanwal, 2008). Once internal allocation is taken cared of, the company can focus on other aspects of the organization to achieve growth.
An organization is faced with the dilemma in choosing which finance strategy would best suit their corporate structure. Will it be to adopt a financial strategy driven towards greater efficiency or towards better management of the organization as a whole It is ideal and optimal to achieve both and when an organization is able to do so then it can focus efforts on the remaining functions. Some organizations have tried to standardize the established financial system to be able to replicate the system and apply it in the global spectrum.
Many organizations have tried to focus on the enhancement of the financial function to achieve greater efficiency in the bigger picture. To be able to maintain their global positions and to determine which strategies best suit the company, these organizations do benchmarking. Benchmarking is a flexible tool in management which can be used in the various functions of an organization. Companies do industry scans and assess the strengths of their competitors (Ruth, 2006). They use these assessments to determine which areas are weak in their own organizations, which functions need to be given attention and what measures are to be taken to implement changes if there are any.
In the organization's venture towards being cost-efficient and at the same time globally competitive, it encounters various problems along the way and it must take note of various risks consequent with the implementation of financial strategies that it has decided to implement. Some points and important matters that the organization has to take into account before deciding which strategy to use are the current corporate structure and the system of the organization.
Corporate structure helps determine which processes best contribute to the organization's growth and development. Flexibility of the corporate structure is also very vital especially now in the current dynamic industries we have (Sanwal, 2008).
For systems, in an industry scan done by SAP, the two systems that place great weights on finance are transaction processing and decision support system (Patel-Muellers, 2006). Though companies want to focus on decision support and management, they are in truth spending their time on transaction processing. However, progress is little by little evident in the efficiency of the companies' processes as they journey towards being more strategic.
To have trouble-free and more efficient ways of deciding which financial strategies to implement, various applications have been created and are available for companies. These applications help mitigate risks that the companies face when choosing the right strategies. We are now in the information age. As market competition grows more intense, we have to be updated and must be equipped with the latest and best tools to aid us in strategy formulation and decision-making (Mahoney and McGahan, 2007).
With the advent of information technology, implementation and