Assignment 01 - FM

Center for Entrepreneurship and Small Business Management, MDSU Ajmer
Assignment, May 2020

MBA (DS) I (Semester II)
Financial Management
Instructions:
 Submission by Sunday 31st May 2020.
 It is expected that you present your arguments in a clear, concise and logical manner
and that conclusions shall be reached.
 Write the answers in this word file and send the completed assignment when done.
Q1) From the view point of a businessman discuss the factors that he considers as
challenges that he encountered while procuring and investing funds for his
business. Also go through the various job advertisements published in
newspapers/online and keep a record of the qualities and qualifications required for
a Finance Manager.
Answer: Here are some common challenges that businesses of all sizes must deal with:
1. Poor internal needs analysis

When a department or business unit identifies the need for a product or service, it kicks off
the procurement process. The risks here are somewhat obvious:
 Overstatement of the need

 Understatement of the need
 Unrealistic schedule
 Inadequate budget
 Poorly designed requirements
Obviously, any of these situations result in wasted time and/or unneeded expense. Far worse,
they delay critical product rollouts or projects. These delays frustrate today’s impatient
customers and, nowadays, they’ll discuss it with their friends. This customer dissatisfaction
has an outsized negative impact on your brand.
2. Vendor selection and management

Procurement’s first task is to ensure a reliable and stable supply of the products and
services your business needs. Without dependable vendors, needs go unfulfilled and projects
are delayed even for big companies. As we’have seen, the impact is outsized.
Globalization has further distributed supply chains across vast distances and timezones. As a
result, one of procurement’s most important priorities is developing real relationships with
suppliers. The most successful businesses are those that treat suppliers as partners and
understand the benefits of truly collaborating with them.
According to a recent survey, almost 60% of companies have taken measures to strengthen
the quality of their supplier relationships.
3. Corporate Social Responsibility (CSR)
It has now clear that customers prefer to purchase from companies they perceive to be
ethical. The loyalty and price premiums for doing so are real and companies that genuinely
commit to corporate social responsibility programs enjoy the financial rewards for doing so.
Millennials are the big drivers behind the movement to champion ethical and environmentally
conscious companies. As the proportion of these younger generations grows, they are flexing
their financial muscles to promote their agenda.
As companies recognize that they will be held responsible for their products from sourcing to
distribution, procurement plays a critical role. It must ensure that suppliers adhere to the
social, ethical, environmental, and fairness standards that the business itself promotes. It must
vet and monitor suppliers and work with those that promote diversity and inclusion, commit
to sustainability,
4. Lengthy processes & inaccurate Data
It’s a business reality – products and services must sometimes be procured at the last
minute in order to meet a deadline. Late projects are already a huge source of stress – the last
thing you want is unnecessary internal bureaucracy that causes further delays and stress.
Errors and mistakes are another needless source of stress, delay and time waste. Inefficient
processes also encourage maverick purchasing and the risks that entails.
As we’ve already seen, the downstream impacts such as slower product rollouts, quality
issues, and brand damage are major concerns.
6. Talent shortage
To succeed in the 21st century, a business must attract and retain world-class talent. The
procurement department is no exception. In fact, a recent brief from DHL Research
predicts severe talent shortages for supply chain professionals.
Yet the majority of companies have taken zero steps to develop a long-term strategy to
shore up their talent. As a result, they risk being unable to execute even if they have a
solid strategy.
Further, as procurement’s priorities evolve, the core job has changed. It’s harder to
find people with the right mix of tactical and strategic skills. Companies who don’t have
a long term plan risk having to deal with a significant skills gap.
Q2) Visions Ltd. is a renowned multiplex operator in India. Presently, it owns 234 screens in
45 properties at 20 locations in the country. Considering the fact that the there is a
growing trend among the people to spend more of their disposable income on
entertainment, two years back the company had decided to add more screens to its
existing set up and increase facilities to enhance leisure, food chains etc. It had then
floated an initial public offer of equity shares in order to raise the desired capital. The
issue was fully subscribed and paid. Over the years, the sales and profits of the company
have increased tremendously and it has been declaring higher dividend and the market
price of its shares has increased manifolds.
In context of the above case:
1. What are the different kinds of financial decisions taken by the company by quoting
lines from the paragraph?
2. Do you think the financial management team of the company has been able to
achieve its prime objective? Why or why not? Give reasons in support of your answer.

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Center for Entrepreneurship and Small Business Management, MDSU Ajmer

Assignment, May 2020

1. Poor internal needs analysis

 Overstatement of the need

2. Vendor selection and management

3. Corporate Social Responsibility (CSR)

4. Lengthy processes & inaccurate Data

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