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Money Bag

Unit 3 - Finance & accounts

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Chart Increasing

Unit 1 - Introduction To Business Management

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Briefcase

Unit 2 - Human Resource Management

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Direct Hit

Unit 4 - Marketing

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Factory

Unit 5 - Operations management

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Bar-Chart

Unit 6 - Assessment

Think of budgets like a roadmap and variances like a GPS telling you how far you&rsquo;ve strayed from the path!

<ul>
	<li>Choosing a path from many options to solve a problem.</li>
	<li>Steps: Identify the problem &rarr; Gather info &rarr; Choose the best solution.</li>
	<li>For businesses, it&#39;s about where to go next and how to use resources.</li>
</ul>

<ul>
	<li>
	Planning 🗓️

	<ul>
		<li>Real-world Example: Like planning a road trip, you need a map (budget) to know which route (plan) to take.</li>
		<li>Budgets give direction and help foresee future issues.</li>
	</ul>
	</li>
	<li>
	Motivation 💪

	<ul>
		<li>When employees are trusted with budgeting, they feel valued.</li>
		<li>Real-world Example: Like being given the chance to plan a family event. It makes you feel important and trusted.</li>
	</ul>
	</li>
	<li>
	Resource Allocation 🔄

	<ul>
		<li>Prioritizing how money is spent.</li>
		<li>Real-world Example: It&#39;s like having $100 for a week. You&#39;ll prioritize food over a new game.</li>
	</ul>
	</li>
	<li>
	Coordination 🤝

	<ul>
		<li>Making departments work together.</li>
		<li>Real-world Example: Imagine a school project where everyone knows their role, thanks to a clear budget and plan.</li>
	</ul>
	</li>
	<li>
	Control 🛑

	<ul>
		<li>Keeping an eye on expenses.</li>
		<li>Real-world Example: Like parents checking their kids&#39; spending habits.</li>
	</ul>
	</li>
	<li>
	SMART Goals 🎯

	<ul>
		<li>Budgets should be Specific, Measurable, Agreed, Realistic, and Time-bound.</li>
		<li>Real-world Example: Saving $500 for a new phone in 6 months.</li>
	</ul>
	</li>
	<li>
	Comparison &harr;️

	<ul>
		<li>Measuring real results vs. planned ones.</li>
		<li>Real-world Example: Predicting you&#39;d score 85 in a test but getting 90 &ndash; yay! You beat your forecast!</li>
	</ul>
	</li>
	<li>
	Detecting Deviations 🔍

	<ul>
		<li>Finding where things went wrong.</li>
		<li>Real-world Example: Realizing you overspent on snacks and need to cut back.</li>
	</ul>
	</li>
	<li>
	Objective Appraisal 🏆

	<ul>
		<li>Judging how well departments stick to budgets.</li>
		<li>Real-world Example: Like a team leader evaluating who followed the game plan.</li>
	</ul>
	</li>
</ul>

<ul>
	<li>
	Inflexibility 🪝

	<ul>
		<li>Budgets can&rsquo;t always adapt to sudden changes.</li>
		<li>Example: Your family planned a picnic, but it rained. What now?</li>
	</ul>
	</li>
	<li>
	Loss of Importance 📉

	<ul>
		<li>When real results are very different from the budget, trust is lost.</li>
		<li>Example: Promising to study 5 hours a day but only doing 2.</li>
	</ul>
	</li>
	<li>
	Short-term Vision 👓

	<ul>
		<li>Some budgets only look at the immediate future.</li>
		<li>Example: Focusing on this week&#39;s homework and forgetting about the big project due next month.</li>
	</ul>
	</li>
	<li>
	Wasteful Spending 💸

	<ul>
		<li>If there&rsquo;s money left, it might be spent carelessly.</li>
		<li>Example: Using your leftover pocket money at the end of the month to buy candy.</li>
	</ul>
	</li>
	<li>
	Resentment 😒

	<ul>
		<li>Not involving everyone in budget-making can upset them.</li>
		<li>Example: Feeling left out when friends make weekend plans without you.</li>
	</ul>
	</li>
</ul>

🔑 Key Takeaway

While they&#39;re not perfect, budgets and variance analysis are crucial tools in decision-making. They guide businesses in managing their money and achieving their objectives. So, always remember to plan your budget like you&#39;d plan a fun trip!

&nbsp;

Happy Budgeting! 📊🌟

Unlocking Business Success: Budgets & Variances In Decision-Making

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Higher Level

Business Management HL

Unit 3 - Finance & accounts

Unlocking Business Success: Budgets & Variances In Decision-Making

Table of content

🧭 What's Decision - making?

Unlock the Full Content!

Unit 3 - Finance & accounts

Unlocking Business Success: Budgets & Variances In Decision-Making

Table of content

🧭 What's Decision - making?

Unlock the Full Content!