Course Overview

What is Financial decision making? All businesses continually need finance to maintain their existence. It wouldn’t be far-fetched to say that businesses exist because of money to make more money.

Initiation of a business, setting up of an enterprise, purchasing inventories, hiring employees, manufacturing products, paying rents, putting up advertisements, buying machinery, paying a dividend to shareholders- each and every activity has its emergence because of finance.

Money, capital, cash, investments are all inter-related terms that may carry the same meaning for a non-professional. However, a professional would not only be able to differentiate between these terms but also would understand how each and every aspect of finance needs adroit management.

A proper understanding of finance by the manager can prove to be the distinguishing factor between a successful and unsuccessful business. Merely arranging funds and then spending it on various activities cannot spell prosperity for the firm.

It requires apperception that there’s science behind acquiring and allocation of finance. The management needs to strategically make decisions regarding crucial financial aspects. Developing skills regarding strategic use of finance will increase the profitability of the business and ensure its long-term survival among the cut-throat competition.

What are various sources of acquiring finance? Which source is best suited for the firm? How will the time value of money affect the firm’s operations? What will be the best investments for the business?

How can investment performance be evaluated? What capital structure mix will best conform to the corporate’s overall objectives? How can the firm strive a balance between managing debt and financial leverage? How proper evaluation of alternatives will result in value maximising decisions? These questions might be an enigma for the general managers of the firm.

Their lack of understanding will prevent them from comprehending strategic implications these questions may have on the firm’s financial health. It becomes integral for both general managers and finance managers to understand the interdependence between strategy and finance. General Managers need to gain knowledge of finance for effective decision making and finance managers need to discern strategic management for productive financial results.

This Zoe training course acknowledges that understanding finance is closely associated with strategic decision making and offers a parallel between finance and effective strategy formulation. This course is a prerequisite for any professional who aims to make a positive impact in their jobs with the enhanced practical and conceptual insight into finance.

It will inculcate within its participant’s foundational knowledge of finance with best practices, techniques and methods that can be adopted for sustainable value creation for the firm. This course will broaden the decision-making ability of its participants by linking financial theories with business policies.

Course Objectives

On successful completion of the Understanding Finance for Strategic Decision-Making course, participants shall be able to:

• Understand the application of elemental principles of finance to business strategy and policymaking
• Appreciate correlation between finance and strategy
• Comprehend how strategic decision making can increase shareholder’s wealth and result in value maximisation
• Know various functions of finance and how they affect the overall well-being of the firm
• Value assets and manage financial risk for the firm
• Understand various concepts related to working capital management, evaluation techniques, financial analysis, time value of money, etc.

Training Methodology

This is a collaborative Understanding Finance for Strategic Decision-Making training program, will comprise the following training approaches:

• Interactive lecture sessions
• Problem-solving sessions
• Presentations
• Case studies
• Financial modelling
• Group discussion
• Management games

Zoe Talent Solutions follows the ‘Do-Review-Learn-Apply’ model.

Organisational Benefits

On successful completion of the Understanding Finance for Strategic Decision-Making course, participants shall be able to benefit their organization in the following ways:

• Applying best capital budgeting techniques and take prudent decisions regarding investment
• Evaluating various sources of finance available to the firm using techniques such as EBIT-EPS analysis, etc.
• Understanding how the cost of capital of the firm will correspond with the overall objectives of the firm
• Gaining a deeper understanding of the time value of money and how it affects financial results
• Devising the most suited capital structure mix for the firm
• Acknowledging financial risks prevalent in the firm and take steps to mitigate them
• Setting financial goals that complement the organization’s goals

Personal Benefits

Successful completion of Understanding Finance for Strategic Decision-Making course shall benefit participants in the following ways:

• Providing knowledge of various financial concepts, terminologies and their applicability
• Expanding their present field of expertise
• Growing job opportunities in the field of finance
• Acting as a steppingstone to other job-related training and help the participant adapt better to such trainings
• Enhancing learning and decision-making ability

Who should attend?

• Budding entrepreneurs, start-up founders
• Financial managers, credit managers
• General managers, corporate managers, operations managers
• Business Policymakers
• Departmental heads, managers, executives
• Financial analysts
• Investors

Course Outline

Module 1: Introduction to basics of finance and its relation to strategy

• Financial management
• Role of finance, finance functions
• Role of finance managers
• Agency theory: management vs. shareholders
• Types of financial strategies
• Working capital management

Module 2: Concept of time value of money

• Time value of money
• Future value and present value
• Cash flows and annuity
• Discounting and compounding

Module 3: Risk and return: trade-off

• Calculation of risks using standard deviation, variance
• Beta estimation
• Systematic and unsystematic risk
• Asset pricing models: Capital Asset Pricing Model

Module 4: Capital budgeting

• Investment decisions
• Investment evaluation criteria
• Investment decision making techniques: NPV, IRR
• Impact of capital budgeting on strategy formulation of the organization
• Risk analysis

Module 5: Investment strategy

• Capital investments
• Investment decisions and corporate strategy
• Capital rationing

Module 6: Capital structure

• Capital structure theory
• Understanding debt trap
• Financial leverage
• EBIT-EPS analysis
• Weighted Average Cost of Capital

Module 7: Value maximization and risk management

• Corporate restructuring
• Value creation
• Corporate strategy and mergers & acquisitions
• Leveraged buy-outs
• Risk hedging
• Risk management strategy

Module 8: Financial planning and analysis

• Strategic financial planning
• Inter-relating financial planning and strategy
• Financial statement analysis: ratio analysis
• Comparative statement analysis
• DuPont Analysis
• Case study