The reasons of Financial Information required in formulating business strategy:

The success of an organization, in an increasingly competitive environment, is dependent on the strategy, which will differentiate the organization from the competition. The challenge is not to have the best strategy, but an effective strategy, which can be implemented. Financial Information basically comprises of financial statements and reports. It includes Balance sheets, income statement, statement of retained earnings, cash flow statements etc. The information contained in these documents is very important for the company as a whole and for the marketing department in particular. It lets the company know how a product is faring currently in relevance with the expenditures on that product. Subsequently, the management can decide to increase the marketing and promotion budget of that product. If the financial figures have been declining for that product, they can decide to cut off the marketing budget due to its non-viability. Formulating a strategy is the most fundamental step of running a business. It is the concrete foundation on which the future of the business, successful or unsuccessful, stands. The feasibility of running the business is determined during this very stage, while the managers are formulating the strategy to operate it. In the realm of international management, strategic planning could be broken into certain steps that are four in number and are discussed below: The first step involves scanning the external environment to look out for potential threats and prospective opportunities. Next comes the step of conducting an internal analysis of company strengths and weaknesses. Once the SWOT analysis is complete, the organization should work towards formulating goals in accordance with the inner attributes of the organization that are the strengths and weaknesses. In addition to that, the external factors of the market in which the company is operating should also be considered such as threats and opportunities.

The major risks involved in business strategy:

There is variety of risks involved in making effective business strategy. These risks are: STRATEGIC RISKS Strategic risks are those that arise from the fundamental decisions that directors take concerning an organizations objectives. Essentially, strategic risks are the risks of failing to achieve these business objectives. A useful subdivision of strategic risks is:
1. Business risks risks that derive from the decisions that the board takes about the

products or services that the organization supplies. They include risks associated with developing and marketing those products or services, economic risks affecting product sales and costs, and risks arising from changes in the technological environment which impact on sales and production.
2. Non-business risks risks that do not derive from the products or services supplied. For

example, risks associated with the long-term sources of finance used. OPERATIONAL RISKS Although boards need to incorporate an awareness of strategic risks into their decision making, there is a danger that they focus excessively on high-level strategy and neglect what is happening on the ground in the organization. If production is being disrupted by machine failure, key staff are leaving because they are dissatisfied, and sales are being lost because of poor product quality, then the business may end up in serious trouble before all the exciting new plans can be implemented. All of these are operational risks risks connected with the internal resources, systems, processes, and employees of the organization.

Other relative risks

1. Business development risks - Business development risks related to new markets,
business acquisitions and investments, and new products and services, as well as by risks related to brand and reputation. In business acquisitions the aim is to manage risks by applying the Metso Acquisition Process (MAP) and a thorough due diligence process.

2. Business environment risks - Business cycles in the global economy and customer
industries influence the demand for products and services as well as the financial position.

3. Market risks - Business cycles in the global economy and in customer industries
influence the demand for our products and services as well as our financial position.

4. Technology risks - Technology risks are related to technological competencies, research

and product development. The introduction of new technology offers new business opportunities but may temporarily increase quality-related costs.

5. Political, regulatory, cultural and legislative trends - Political and social unrest,
terrorism and armed conflicts may represent threats to business operations.

6. Phenomena related to climate change and the environment

The key financial information required when strategic decisions are made: