Contextual Anatomy of the Human Side of the Enterprise Management Systems, Financial Planning and Employees Reactions

A management system of which financial planning is one type is effective, if it triggers employees’ reactions in the direction that will promote the achievement of enterprise goals and objectives. To a greater extent, enterprise survival and goal achievement depend on the management systems, financial planning and employees’ reactions. The management system (authoritarian or humanistic) portrays the firm as a composite entity of the goal-setting machine (top management) and the goal-achieving machine (employees, subordinates inclusive). Admittedly, the type of management system and its associated financial planning strategy have a significant effect on the life of any firm. This is because the goal of the organization (for the period the financial plan covers) is contained in the financial plan. This book chapter adopts historical and descriptive research methods. Goals must not only be set in the financial plan but strategies must be evolved to achieve the goals. A financial plan (autocratic or participatory) expresses the expectations of the enterprise from its members and also specifies the employees’ duties and rights (if any) for that period. Financial planning refers to the process of estimating the funds requirements of an enterprise and determining the sources of funds. Financial planning, therefore, is a useful strategy for enterprise goal achievement. This book chapter is necessitated by the unconcerned attitude of enterprise management toward current works of research in modern management systems, motivational theories of financial planning and employee behaviour. Available accounting, finance and business literature support the assertion that authoritarian management systems and their associated financial planning strategies do not always work. Rather than bringing improved performance, such a system generates anxiety, mistrust, interdepartmental strifes, quarrels with financial staff, demotivation, corrupt practices, poor productivity and other dysfunctional attitudes and behaviours that are inimical to enterprise growth and survival. On the contrary, the humanistic management system relative to its financial planning strategy triggers employees’ morale, motivation and productivity. The humanistic management system is employee-centred and has gained a great deal of support in the literature of business management. Such a system boosts corporate existence and enhances continued goal achievement. This system is believed to serve as a panacea: a cure for all the many ills associated with the authoritarian management system and its associated financial planning strategy.