New principles of financial management

Moderately lenient, it is by no means encouraging the waste of corporate financial resources, but in the process of financial management and financial control, combined with the specific circumstances of the enterprise, consider flexible management methods, and under certain conditions, appropriately meet the employees of the enterprise. Or the department's demand for expenses in the financial management theory involves financial control, generally emphasize that the financial control of the enterprise should be consistent with or adapt to the development strategy of the enterprise, emphasizing the extreme importance of budget management to the realization of corporate financial goals, Emphasize the role of budget management in all aspects of internal corporate behavior. In a word, budget management is more emphasis on its control role.

However, it should not be forgotten that any enterprise is an economic entity composed of people. The exertion of human potential is closely related to the environment. It is difficult to give full play to people's enthusiasm and creativity in organizations that emphasize too much control.

Therefore, in the practice of enterprise management, it is necessary to promote a new principle of financial management: the principle of moderate easing.

The connotation of the principle of moderate easing

The "moderately loose" we are talking about here is by no means encouraging the waste of financial resources of enterprises. It means that in the process of financial management and financial control, we should consider the specific conditions of enterprises and consider flexible management methods. Under the conditions, the needs of the employees or departments of the enterprise are appropriately met.
The need to implement a moderately loose principle

Too much “trick” financial management means that the employees of the company will increase their psychological pressure, lose their loyalty to the company, and undermine the existing harmonious atmosphere of the company.

The prominent feature of the financial management method that is too “smart” in budget management is that the company achieves the goal of controlling expenses, reducing enterprise costs, and improving the company's book performance by setting strict cost expenditure standards. In short, it is to implement cost control through the financial management method of “Tricks”.

In the practice of corporate financial management, the financial management methods of “Tuen Mun” still have many performances: no private calls are allowed; employees of different ranks use different means of transportation to implement strict accommodation expenditure standards; some Chinese-foreign joint ventures are Chinese and foreign employees. The use of extremely different differential compensation plans, and strive to lower the treatment of local Chinese employees; reduce the standard of work facilities of ordinary employees, so that they have to pay more time and physical strength in the process of completing the work, and so on.

It should be said that enterprises have sufficient reasons to implement the above-mentioned "trick" financial management measures. Moreover, under the same conditions, the financial performance of the company will be improved by implementing the above financial management methods. However, this is just a static, wishful thinking and a way of thinking. As everyone knows, this kind of "trick" financial management method may cause great damage to the humanities environment of the enterprise: First, it will lead employees to believe that the company does not respect their time and dignity, which will seriously affect the enthusiasm of employees. Second, it will lead to confrontation or resistance between other departments of the enterprise and the financial management department, which will seriously affect the coordination and cooperation between different functional management departments within the enterprise. Third, it will lead employees to lose their loyalty to the company under the conditions of greater psychological pressure, work enthusiasm is greatly reduced, work quality is reduced, waste is increased, and so on. Under the above factors, the financial performance of the company will not only improve, but may also deteriorate.

That is to say, in many cases, the financial management methods that are too “smart” are not worth the candle.

There is no "only correct" financial management means, and the implementation of any financial management means must consider the factors of the enterprise environment and human factors, and must consider the development goals of the enterprise.

It must be understood that within the enterprise, not only the financial management department and the financial management workers are maintaining the interests of the enterprise, but other departments are generally protecting the interests of the enterprise. The maintenance and improvement of the overall interests of the enterprise must be the result of the coordinated operation of all departments: the success of the enterprise must not be simply attributed to the success of the financial management department, or the success of the human resources management department, or the success of the marketing department, but to success. In front of everyone, everyone has merit.

I have found that not a few financial management departments and financial management workers are often accustomed to saying "this can't be done" afterwards, and are not accustomed to saying "how should we do it" beforehand. This is the natural mentality of a “law enforcer”, “supervisor” or “controller”. I think this mentality must change.

Think carefully and sum up, how many of the many decisions made in our own daily life and business management practices are “the only correct” and “not so bad” decisions? We will find that there are really few decisions that really belong to "the only correct" and "not so bad." Most of the decisions are in the same situation as "can be like this or not." This should be the case: even the decisions made by each individual may be the result of different games “games”, not to mention the decisions of many people who stand in different positions.

The embodiment of moderate easing principle in the practice of enterprise financial management

In China's financial management practice, in fact, many aspects have already reflected the principle of moderately loose management. Among them, many companies have already formulated the principle of moderate easing for the compilation of their functional department's cost budget.

We all know that the budgeting of the enterprise functional department budget can be either incremental budgeting or zero-based budgeting. The basic idea of ​​the incremental budget method is to recognize that the expenditures incurred by the relevant departments of the enterprise are reasonable. Generally, the incremental demand for financial resources in the budget period is generally considered, and the budget arrangement adopts the thinking mode of “stock plus increment”. The zero-based budget only considers the financial resources of the relevant departments, and only arranges the financial budget for the necessary needs. The budget arrangement adopts the thinking mode of “considering only future demand and not considering historical inertia”. Obviously, from the perspective of strict budget management, the zero-based budget is an ideal management method, and it should be implemented in newly established enterprises or departments. However, in an enterprise that has formed a certain scale and structure of expenditures, it is a realistic choice to implement an incremental budget and basically meet the expenditure requirements of the relevant departments: this management method is beneficial to mobilize related The enthusiasm of the department is also conducive to maintaining the existing interpersonal relationship atmosphere. Otherwise, if the zero-based budget management method is adopted regardless of the specific circumstances of the enterprise, it will most likely cause the relevant departments of the enterprise to adopt negative confrontation or resistance, thereby offsetting the financial benefits brought by the adoption of the zero-based budget.

Rational use of moderately loose management principles to achieve sound development of enterprises

The financial management department must let other relevant departments understand that it is not a rigid management method for the relevant expenses, and it is not the financial department’s “stupid” to the extent that it does not know how to control certain expenses, but the humanity adopted after comprehensive consideration of various factors. Management tools. The expenditures that are obviously unreasonable expenses and harm the overall interests of the enterprise must be resolutely resisted and cannot be satisfied. The relevant departments and personnel must not be allowed to “sneak out” while enjoying the “moderately loose” management method, and ridicule the financial management department for “stupidity”.

Therefore, rational use of moderately loose management principles to achieve sound development of enterprises requires the financial management department of the enterprise to coordinate cost control and popularity, coordination between cost control and functional departments, cost control and financial goals of the company budget period. The realization, cost control and the realization of the company's long-term development goals, cost control and the maintenance of the corporate human environment seek balance and show wisdom. I believe that the managers of most corporate finance departments have such wisdom.