Examining the Impact of Financial Strategies, Risk Management, and Budgetary Controls on Organizational Performance: The Mediating Role of Financial Decision-Making

Abstract

The impact of financial strategies, risk management and budgetary controls on organizational performance with special emphasis on the mediating role of financial decision making is studied in this work. The research seeks to offer insights into the way in which these financial practices interact and impact on performance in organizations, with the objective of helping to improve the efficiency and sustainability of organisations. Quantitative research design was used, where data were collected through survey questionnaires from managers and financial experts in organizations. Partial Least Squares Structural Equation Modeling (PLS-SEM) was applied to the analysis of the data to test hypothesized relationships among the variables. Findings show that financial strategies, risk management and budgetary controls have critical and positive influence on the performance of the organizations. We also found that financial decision-making mediated the relationships between these financial practices and performance, and that sound decision making is critical for realizing the benefits of financial strategies and risk management. The results of the study emphasize the need for harmonizing of robust financial strategies and smart risk management frameworks to improve organizational resilience and performance.