Skill planning and judicious decisions have special significance in the environment of solutions and uncertainties of complex financial problems of business firms – Managerial Economist.
The officer or officials who are appointed to give advice on financial matters to the highest management are called managerial economists.
Almost The managerial economist provides useful information in future planning and financial decisions to high officials through his special knowledge and management technique.
Therefore, a Comparison of firms’ problems, evaluation of the organization, and alternative projects uses sophisticated and sophisticated methods and plays an important role in finding suitable solutions.
Thus, the importance of managerial economist has been accepted in the era of this business progress to find the highest management solution to complex economic problems.
Today, one or more managerial economists hold the world’s rich developed countries [America, Russia, Japan, England, France, Germany]. On large business firms. Large industrialists and businessmen are trying to enjoy their services.
Role of Managerial Economist
Decision and planning are both difficult tasks in the atmosphere of uncertainties in the business area.
If the managerial economist brings certainty to the managerial decision by estimating his special knowledge, the ability of managing and uncertainty with technical information. Then he will be very successful in his work.
The operation and organization of any Business firm depend on two types of elements.
- Internal factors
- External factors
If managerial economists can analyze both these elements and adjust their effects to a managerial decision, then not only will uncertainties decrease and will lead to the successful operation and rapid progress of the professional firm.
The Role of the Managerial Economist are as follows:
1. Analysis of Business Operation.
The meaning of internal factors or business activities is from those who come under a particular religion or within its working area.
The use of business management is controlled by them, such as production quantity determined pricing, expansion, and contraction of the business production method used in the firm whether to use installed capacity.
Finance capital and profit management and business use and internal elements Come under In this case.
Managerial economists play an important role in managing management in the following areas.
- Determining the budget of profit and sales volume in the coming years.
- For the Future Purpose, the quantity of production quantity should be determined by the goods schedules and stock policy.
- In the next years, what changes should be made in the price policy and wage policy?
- What is the firm’s credit policy in the future, and what are the changes in it?
- In the upcoming years, the business should be expanded and contracted, if yes, how much?
- How many installed capacity should be used in the future. and how much of the instruments should be applied, that the tools can be used?
- What steps should be taken to cut costs?
- How much cash will be available in the quarter of the coming year, half-yearly. and suggest how to reduce the deficiency and how to use excessive, etc.
2. Analysis of External Factors
Business firm decisions do not affect internal Factors only. But also affected by External Factors.
The external conditions are neither under the control of the firm nor in their working area.
For example, business cycles, government policies, monetary policy, fiscal policy, national income, foreign trade policy, the value of a government of labor law, all this is harmful, which affect the firm’s future planning and decisions.
The managerial economist can continue his studies by advising continuous study and comprehensive analysis of these factors and tell the highest management in making policies necessary adjustments.
- In what markets, what are the demands and how the market of the firm’s products is likely to be?
- What are the trends of the national economy and the international economy? And what are the chances of change soon?
- What is the state of the business cycle and what will be its appearance and speed soon?
- What is the probability of the supply of raw materials and the price? And what are the possibilities they have soon?
- Determination of future demand and price related possibilities of the built route.
- What is the cost and availability of creditworthiness in the future?
- What are the prospects of changes in future economic policies and controls?
- How is the competition event or the possibility of growth in business in the future?
- What are the prospects of the availability and cost of fuel or power?
- What will be the prospects and speed of change in the future of national income and what will be the change in the production and demand of the firm?
3. Specific Functions of Managerial Economist
The managerial economist goes into future decisions by analyzing the internal elements and external elements in professional firms.
But nowadays his work has increased and the statements do a specific job. Which provides benefits to the government, businessmen, individuals, and industrialists, including the following.
- Surveying different markets.
- Predicting the industry’s total demand for business.
- Analyzing pricing in different industries, finding a suitable solution to the problem.
- Analysis of valuables and actions in competitive firms.
- Evaluation and analysis of capital projects in productive work.
- Determination of production schedules and goods tables in the industry.
- Making various appropriation decisions available financial instruments.
- Analysis of agriculture, industry, transportation or other development work.
- Analyze the development of the economy.
- Comparative analysis of projects.
- Forecasting external conditions affecting a professional firm.
The managerial economist also offers general financial information to the firm’s managers besides to specific work.
Which is useful for immediate guidance like production fees, import duties, export duties, and other tax rates.
Because the value of firms is what is the value of the competing firms. How much is the production and sale of them?
So, what is the customer’s attitude towards the production of the firm? What is the potential population of the country, region, or various markets? What is the comparative rate of transport? All information is useful for managers.
Responsibilities of a Managerial Economist
The managerial economist offers a lot of support to the highest management in future planning and decision making by looking at the advice in financial matters.
He may prove to be unsuccessful in his advice work. When he is fully aware of his responsibility and successfully completes his loyalty.
Role and Responsibilities of Managerial Economist
In this view, his main responsibilities are as follows –
1. Close Contacts with the Source of Economic information and Experts
The managerial economist can only play his own responsibility
Generally, When all those financial information sources and such experts keep close contact, provide financial information affecting the passion firms, or provide the necessary expert opinion.
Not only this, but adequate financial information will also be available as soon as possible and with close contact with experts, it will be able to make to bring more accuracy in its analysis and conclusions which are useful in policy and future planning.
2. Successful forecasting
There is an element of uncertainty in the future in front of every firm and managerial economist is the responsibilities.
That can reduce the risk by giving proper management of values to business management.
by eliminating the future and making sure that the earlier estimation has been corrected and that it would be easy to manage and believe in management.
Thus, The business continues to have the effect of new external conditions. Thus, the managerial economist should continue to prescribe the revised forecasts.
So, the management can make the desired adjustments in future plans and policy decisions according to changing circumstances.
3. Efforts for Reasonable Return of Capital Employed And increase Therein
The aim of every business firm is to make a profit. Only the working person attempts to achieve this goal. If business decisions and future planning times are not conducive.
Then the managerial economists and managers have to take responsibility for themselves.
And his skills are reflected in him because he is able to increase the firm profitability through the constant use of pricing and production policies and get the proper benefit from the firm’s appropriated capital.
Thus, If the firm is unable to get the proper benefit of capital adequacy, it will lose the trust of managers and its reputation will be less. Not only this, but the firm also will not have its superiority either.
4. Establishing a high Reputation And Status in the firm
The managerial economist should develop his high reputation in the firm by building his skill inefficiency, integrity, successful predictions, and firm in the firm.
So, that he can find a suitable place for his firm. if he wishes to manage the financial matters provided by him. Gets support, The complex financial problems are solved by presenting them. then the managers will awaken confidence and faith.
If he is skilled and unsuccessful in the above work. he will sit on his prestige and place. Role and Responsibilities of Managerial Economist.
So, there is a need for great vigilance and integrity.
5. Sweet Relations
It is the duty of a managerial economist to have a common relation. also among all the workers in the firm who are employed.
In this order not only to work in the atmosphere of mental peace and its skill comes. to get cooperation and not to oppose the trend.
- Financial Statements: Meaning, Nature, And Objectives (Explained)
- 14 Importance of Study Consumer Behaviour (Explained).
Thus, It is clear that the managerial economist should be cautious of the above liabilities. it should provide specialist service close to the integrity, efficiency, and realism in his work.
Which is not only a threat to its own employees. and can push the reputation of economists of all management.