Management tool of business rationality

Management control should become the management tool ensuring business rationality and essential information for decision making in the risky business. Risk should always be treated as an element of the stochastic reality in which the company operates. Hence, it is necessary to complete the management control with the analysis of the impact of individual strategic options on the risk exposure and company financial situation, non-linear planning and stochastic approach for objectives setting and key risk measures indication, taking into account the investments at risk and development of risk adjusted performance measurement. Above mentioned adjustments should lead to an improvement in the predictability of the plans execution and better management of activity options, optimizing the capital requirement for financing operational activity. It is essential to identify, analyze and control the potential plans deviation of different decision options. Hence, it is important to build competences within management processes that will secure the precise risk analysis. The implementation of risk controlling elements to management control and the risk impact consideration in managerial information makes risk issues important for every manager. There were desribed in the blog various proposals for the development of risk issues into management control, which makes crucial to create the necessary competencies not only in management control, but also in various management levels. It supports to secure the execution of the company's strategic and operational goals thanks to both relevant managerial information presenting the impact of risk on the company's performance and efficient steering decisions-making at risk. Managers receive support for taking effective decisions concerning the allocation of resources within the company and an instrument for measuring performance based on RAPM. It creates a mechanism combining risk exposure with economic results and supporting risk reaction, what allows to develop the most effective strategies for the operation of the companies in the extremely volatile global business environment.