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Henry Fayol’s principle of division of work has been the key for business management. Even it is really a logical doctrine. In fact there is no one today including me who negate this key principle of management. But I have no harm in saying that this principle is more valid in operational levels. Strategy level management has some different dynamics and many times the strategists have to raise their level of expertise and skills in the fields other than their core areas.

In the game of cricket the role of an all-rounder became more important in the year of color shirts i.e. 1991 – 1992. It was not about any thing but the pace cricket was picking up and the need of having 11 bowlers while bowling and 11 batsman while batting. In management, principles are only valid once they provided the environment intact. There is no hard and fast rule, just the desire of mastering in volatile environment and accomplish success in anyways. When I talked bout accomplishing success in anyways, it never means illegal and immoral. Sometimes there are hardcore professionals and charismatic people (businessman, leaders, politicians & mentors) who can change the directions of legalities and moralities to the extent they can.

In my view the failure of the world’s business system for last eight years is not merely because of bad financial planning and investment on paper assets (shares, off plan real estate, financial securities etc.). One of the big reasons was unlimited desires of the marketing people, the excessive unnecessary advertisement campaigns design by an advertisement department and an irrational sales modeling by sales team. In the end it emerges as the financial failure. Many activities that the company doesn’t make with in their financial structure they make it by leveraging their financial structure on the qualitative inducement of different operational folks. The anticipated result (they shown) were more qualitative and they impart the mess on quantitative aspects and disturbed the whole financial strength of the company.

I have been in a banking company some years before and they launched a new debit and credit card. The debit and credit card are the financial products. Their instincts are purely to serve financial need of people. The way that banking company markets those cards was purely out of context. They just hired a super model. They designed a media campaign and launch a banking product like a Shampoo, Mobile Phone or Tetra packs of milk. It was all about hitting millions of rupees to bank’s bottom line and the result???? till today there is no place of their debit card or credit card in the market. It was all about the marketing professional’s objective to boost sales, creating a brand and hype but they are really unaware of the numerical or profit and loss aspects of the business. It is even many times that the marketing department never cares to see the analytical reports generated by MIS of the company. They just see how big the spark is but how it can provide electricity to the mechanism of the company, it is none of their business. Even this is not their fault. This is the nature of their work and creativity.

The case is not different in term of sales team. They just care more to book the sale at any cost. Even all organs of the company are limited to their roles and they can not understand their financial impacts. This is because; many of the marketing, sales, media, communication department’s folks opts this profession as they know they are not good in mathematics and accounting from their junior levels of education. In my view numbers (accounts) gives best training to the people to see how the strategy is working. Numbers can be of your company or the whole market data.

Creating this context never means that the tasks and roles of sales, marketing and operational team are inferior. They are the important guys in company’s success. Just one reality, their activities and creativity has to be track and assess regularly on quantitative tools. In business, an excellently designed marketing campaign can merely be a stupidity if this will not fit in the available financial structure or where the target is much lower than the perfectly designed marketing campaign. It is really foolish to purchase sword to cut an apple. It wastes your energy, cost and on the other side people will think you mad. Creativity never means inefficiency. All these things are pushing the role of finance and investment professionals as an all rounder.

Now, here I can not advocate that every finance and investment guy can be good in marketing, sales strategy, media and communication. The point I am advocating here, if we have finance and investment buddies who can understand marketing, sales strategy, media and communication, so they are the folks who will be the leaders in corporate strategy and management. They can better manage the company over all and especially its decision making. This is also applicable on the professionals in marketing and sales to be equipped with financial tools to enhance their version. But it is not practically (easily) feasible or its probability is very low, if it can be worked out so, it will also be an excellent aspect for the company.

It is the hunt of Corporate Leader or Principal Strategist who must be the all rounder. He must be creative, presentable and controlled aggressive. In my view the folk related to Finance and Investment is the best candidate for this.

I myself have spent most of the time in making financial models, talked about corporate valuation, analyzing financial statements and drafting a financial strategy. I also performed my role as a sales and marketing strategist in my own company in Dubai. I really enjoy doing practical sales also. I have made my portfolio more than any sales folk on peer’s level. The basic reason was my ability to communicate and determine the profit and loss aspect of an activity (transaction). The skills of calculating and playing with numbers gave me a clear edge while selling the real estate products to my clients.

When I started teaching to the finance students; I saw they are more concerned in understanding NPV, IRR, MIRR, CAPM, WACC etc. Definitely they have to understand all this stuff. It is the responsibility of the finance professor to make his students firm on calculations and understanding the concepts of different financial models. But the key aspect is sensitivity and managerial analysis. A finance professional or student must have to understand marketing, sales, advertisement and other operational aspect of the business to get his calculation LIVE and VAST. If he wants to develop in the role of corporate leader so he must make his financial modeling dancing and rocking on the floor. This can only be happening if his focus is not merely giving conclusion on the given variables (data or accounts) but his ability to understand the variables to the extent that he can advice relevant department to opt ABC (specific) strategy to get the variable what he want to work his financial model to maximization of corporate worth.

I am talking about the next generation of financial managers whom I termed as F.R.M.P. (Financial Research and Management Professionals). In fact every thing that is connected to data and accounting even the decision making tools are on the software today. Your IT (Information Technology) Department is getting more responsible for accounting even. If software knows how to make accounts and you are making timely adjustments in it for changes in accounting principles (like IFRS) so the task of calculation or accountancy is auto (even to the extent of adjustments). Here I am seeking to have Finance Department different from accounting department. In my view after 10 to 15 years there will be no accounting department practically. It will all FINANCE, IT & AUDIT. So here finance professional have more room to equip himself with the skills in marketing, sales, media and management. They must not involve in operational roles of the relevant departments but they need to analyze their goings. They can give corporate level policy for relevant departments after consulting with the relevant departments. Once their understanding of operation will get refine, they will have better control and drive over the structure of the company.

It is all about covering perspectives in business. If we need to develop a successful combination in our team for meeting the volatile changes in business environment today, so, we have to think beyond previously created circles. The success of tomorrow’s business is in the ability of their finance folks to understand all aspects of the business. They need to be trained in the same fashion and low level financial managers have to be deputed in different departments for understanding their operations. The way we will utilize sharpness of finance folks will determine the level of success we can attain.

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syed ajaz ahmed Says:

Yes, I totally agree with you since I faced the same situation in corporate sector while I was heading the finance and accounts department. Head of marketing department used to think me a hurdle in their work. Here I would like to suggest that Marketing department staff should also be deputed in finance department to understand the financial implications of marketing decsions.

13 - July - 2009 04:18:14 AM

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Mr. Omer

Mr. Omer [1982 born] started  his professional career as a commercial / investment banker after achieving Gold Medal in Finance at master level from University of Karachi in 2006.

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