Bolivarian Republic of Venezuela

Ministry of People's Power for University Education

Ministry of People's Power for Internal Relations and Justice and Peace
National Experimental University of Security
CEFO MONAGAS

STRATEG
IC
FACILITATOR: PARTICIPANTS:

PLANNIN
COM. DIONNY GONZALEZ SUP. BOSS BILLY SANCHEZ
CI 13.826.314
SUP. CHIEF JOSE G. DIAZ
G CI 14.788.139
RENGO FLOWERS
CI 18.245.642
Carlos Martinez
CI 19.084.426
WHITE ROSEMARY
CI 19.129.674
JOSEPH F. GARCIA
CI 25.245.808
FRANKLIN A. OJEDA
CI 19.398.556
MATURÍN, APRIL 2021
 STRATEGIC PLANNING

PLANNING

As for a general definition or conception of planning, there are various

definitions such as:

“Planning is selecting information and making assumptions about the future to

formulate the activities necessary to achieve organizational objectives”

“Planning involves selecting missions and objectives, as well as the actions

necessary to accomplish them, and therefore requires decision-making; that is, the
choice of future courses of action from various alternatives.”

STRATEGIES

The concept of strategy has been the subject of multiple interpretations, so

there is no single definition. However, in terms of administration, they are
considered as the paths that allow objectives to be achieved.

Some authors have made their conceptions as:

“We define strategy as the determination of basic long-term objectives of a

company and the adoption of the courses of action and the allocation of resources
necessary for their fulfillment”

“Strategy is defined as a broad and general plan developed to achieve long-term

objectives, it is the end result of strategic planning”

To formulate a strategy, managers can use several tools, such as:

  Critical Questions Analysis
 SWOT Analysis
 Business Portfolio Analysis
 Porter's model for industry analysis.

These tools allow for obtaining successful and measurable strategies in order
to achieve the objectives. Once the general parameters involved in planning are
known, it must be defined how strategic planning provides the direction that will
guide the mission, objectives and strategies of the company and/or institution.
From both definitions, what can be taken is that planning as such is the general
parameter of companies within which the mission, vision, objectives and different
routes of action are delimited.

For Drucker, strategic planning is a process that consists of making business

decisions in a systematic manner and aiming for the greatest possible knowledge.
In this way, it is possible to organize all the efforts that are necessary to be able to
put these decisions into operation, making a comparison with the different
expectations that exist, through an organized feedback system. In this type of
Strategic Planning, both long and short term considerations are considered.

According to the previous definition, strategic planning can be defined as: a

process of an analytical nature, in which the business defines which strategies are
going to be applied to achieve the goals established within an institution, these, in
turn, are developed according to the resources available to be able to meet them,
through a thorough study of the situation and how its relationship with the
environment in which it operates is carried out.

Therefore, it aims to focus on procedures that generate long-term results and

on the evolution of the fulfillment of goals and objectives. In short, strategic
planning aims to try to answer three main questions:
Where am I?
Where do I want to go?
How am I going to get there?

By answering these questions, a projection is created of where we want to go

and what means will be implemented to achieve it. To do this, these terms must be
separated and defined separately.

In itself, strategic planning is a long-term process, as it facilitates the

development of plans for each of its functional areas, having two limitedly different
relationships, which are:

 Make a "map" of an organization's probable future decisions.

 Design a personal course of action for the future.

However, in both cases, one faces the uncertainty of what will happen in the
future and how one will act appropriately to fulfill the fundamental purposes, which
creates a link that in the end the personal and organizational dimensions converge
together insofar as the direction chosen for organizations will influence people and
vice versa, practically trying to act proactively configuring strategies that allow
taking advantage of internal strengths and external opportunities, but for this it is
essential to specify exactly and carefully the mission that will govern the company,
the mission is fundamental, since it represents the operational functions that it will
execute in the market.

From all of the above, it must be understood that a good plan is one that
manages to develop an excellent analysis of the situation and consequently allows
the chosen route to be sufficiently precise to avoid serious deviations, which is why
the design of contingency plans, monitoring systems and decentralized and flexible
organizational structure complement a successful strategic planning process.
 Strategic planning is more than a mechanism for developing plans; it is a
process that should lead to a strategic way of thinking, to the creation of a
management system inspired by a strategic culture. This is the true objective of
this process. Leaders are required for this objective and they are the strategists. A
strategist is that person or official located in senior management who is responsible
for defining the objectives and policies of the organization.

LEVEL OF STRATEGIES AND TIME HORIZONS

The functional strategy (Company Policies) consolidates the departmental

capabilities demanded by the company's businesses, and also constitutes the
repository of the competitive tools that develop the company's particularities. Its
temporality is identified with the annual cycle (marketing strategy, production
strategy, human resources strategy, etc.)

Operational strategy (Business tactics) deals with how the different

components of the organization (resources, processes, people and their skills)
contribute effectively to strategic, corporate and business direction. Its temporality
is identified with periods of less than a year (Pricing strategy, promotion strategy,
etc.).

Of the three hierarchical levels in which the strategy is structured in an

organization, the business level is the one in which the specific activities are
carried out.
of company management. From here arise most of the methodologies and
concepts necessary to understand strategies at a functional and tactical level. The
development of the strategy is then based on the definition of strategic business
units and the choice of the competitive strategy in each of these businesses.
THE STRATEGIC PROCESS: PLANNING, EXECUTION AND EVALUATION OF
THE STRATEGIC PROCESS

The success of a management begins when innovative and competitive ideas

are generated when formulating the strategy, but, above all, when these ideas are
transformed into results. These results depend on the efficiency with which the
strategy is executed and the evaluation systems that are established. To achieve
this efficiency, it is important to review the legal and hierarchical structure of the
institution and assess whether it responds to the formulated strategy; if not, the
necessary adjustments must be made, such as adopting a relevant legal form,
creating, adapting and/or eliminating functional areas and hiring and/or training
human resources, among other actions.

Another relevant aspect when executing the strategy is designing and/or

adjusting the organization's management model. This requires establishing
precisely how the institution will work in its daily activities: who will make the
decisions, how activities will be coordinated, objectives will be defined and efforts
will be motivated. The model should not be rigid so that management is agile,
facilitating creativity and participation of managers and their workers.

In order to compare the results of the execution of the strategy against the
goals of the strategic objectives and the priority lines of action established when
formulating the strategy, it is important that the institution defines evaluation criteria
that allow it to know if what is desired is being achieved and, if necessary, apply
corrective measures. This is because the indicators are the main component of the
evaluation system, that is, they are measurement standards that are designed
according to what is intended to be measured, for example, the efficiency and
effectiveness of some activity of the organization. Their application must be easy
and useful and must be consistent with the defined strategy.
 Strategy execution: Strategy formulation may be excellent, but it can fail if it is
not executed correctly; for this reason, its execution must be managed with the
same strategic orientation by those who lead the institution. Initially, one must
move from strategic thinking to strategic action in an understandable way, which
implies determining the institutional management model and the organizational and
legal structure of the institution. Both aspects may already be established, but it is
necessary to verify whether they fit with each of the components proposed in the
strategy.

In the action plan, a person is assigned to each priority line of action; it is

desirable that one of them acts as coordinator, and perhaps could also be
responsible for business management in practice, since in this way the strategy will
be communicated correctly by someone who participated in its formulation.

to. Legal and organizational structure of the institution.

The legal structure is the legal figure through which the institution carries out
its activities before the government. This gives the institution its constitutional
character and legal credibility, since it is legally constituted. It is only verified that
the legal figure is pertinent to execute the formulated strategy. Generally, an
organization can operate as a natural person or a legal entity, unlike institutions,
which are all managed legally.
Regarding the organizational structure, it is necessary to analyze whether the
current areas to which specific functions were assigned and the personnel
available are those necessary to execute the strategy. It may be necessary to open
new departments or eliminate some, it is also possible that it will be necessary to
hire personnel with a certain profile and/or train current operators, administrators or
managers in certain areas.

An appropriate organizational structure is essential for implementing the

strategy, since it assigns functions and authority for decision-making, divides the
organization into sectors and departments, distributes authority among hierarchical
levels, and establishes communication mechanisms that will facilitate interaction
and coordination between the different areas and activities.

b. Business management model

Having a business management model involves defining how the business

will work on a day-to-day basis in four dimensions: decision-making and
coordination of activities (the means of management) and defining objectives and
motivating efforts (the ends of management).

Evaluation: is a systematic and comprehensive process implemented to verify

progress in meeting the goals of strategic objectives and priority lines of action.
Comparing actual performance with expected results provides the feedback
necessary for the company to evaluate and take corrective action as needed. The
process in the following figure includes the following phases (Wheelen & Hunger,
2012):

 Determine what will be measured. Once strategic objectives, strategic lines

and their goals are defined, an analysis is made of which processes and
results will be verified and evaluated. For example, if a priority line of action
specifies that costs will be reduced by 12%, one of the processes to be
verified would be production and purchasing, and the result to be verified
would be whether 12% less was actually spent to produce the same quantity
of product.
 Establish indicators and goals. As mentioned above, the indicator is a
measurement standard (index, percentage and number, etc.); the goals are
numerical expressions of what is desired to be achieved.
 Measure performance. It specifies when the measurements will be made. In
the case of the example, the measurement could be carried out six months
or one year after the strategy is defined.
 Compare actual performance with planned performance. Once the strategy is
implemented, the actual result is compared with what was planned.
 Take corrective action. The measurement system must consider a
compliance tolerance margin. If the results fall outside this range, corrective
measures must be taken and questions must be answered that will vary
depending on the goal proposed in each strategic axis. In the example case,
one might ask: were new suppliers sought and secured?, were processes
adjusted to reduce production time?, were packaging or components
modified to reduce the number of parts in order to reduce cost?, is the
deviation only an occasional fluctuation?, are the processes being carried
out incorrectly?, are the processes adequate to achieve the desired
standards?, and who is the best person to take corrective action?

When to evaluate

The evaluation can be done at three different times:

 During the diagnostic process – which is when strategies are planned
according to the situation of the institution or company, thus providing a
basis for their choice.
 When priority lines of action are executed.
 At the end of a certain period.

Evaluation indicators
 To evaluate, it is necessary to develop an evaluation system, the
main component of which is the indicators.

The types of indicators are diverse:

 of inputs and outputs (quantity of inputs used and quantity of products

delivered, for example);
 Budgetary and accounting.
 Organization and social (participation in assemblies or use of social services
provided by the cooperative, for example)
 Of economy, efficiency and effectiveness (waste reduction, reduction of
processing or harvest time, etc.), among others.
Beyond their classification, the important thing is that they are easy to apply
and useful for the company's purposes.

THE STRATEGIC POLICE OFFICER

a) Strategic planning and the development of a strategic plan.

Crime Prevention Plan in the La Gran Victoria Housing Complex

The prevention and Citizen Security of Quadrant 37 of the La Gran Victoria

Housing Complex in which the following research methodology is manifested and
put into practice as an Action Plan as the statement of the problem for the
prevention of Crime in the execution of a project in which the community is related
and integrated and efficiently deal with the problem that keeps them in constant
anxiety due to the constant robberies that affect a large part of the Citizens who
reside in the 17 Zones that make up the La Gran Victoria Housing Complex, of
which three Zones 4, 5, 7 and 8 are the most active and it is where the problem lies
mainly because most of the young people are related to the problem of constant
robberies and drug sales, for which the methodology to be implemented is action
research for the prevention of crime in the aforementioned areas, because they are
the strongest and their mode of operation is the constant communication that these
people or groups in conflict maintain with external people, later it will be possible to
verify through the Research and information provided by Citizens of the different
Blocks, that they maintain an organizational network of complicity with people who
live in the alternate Sectors of the Complex by which they are persuaded to commit
robberies inside and outside the Gran Victoria Complex, as has been happening in
recent months at the main entrance to the Invasion de la Puente road, specifically
in the (Redoma) where People who reside in the Complex are victims of the
constant robberies that are committed daily, when these in the early morning hours
leave their apartments to take the bus at the entrance and others who travel on
foot along the Main Avenue to go to work, after the investigation carried out, a
preventive security work system was planned that allows to reduce and attack
these incidents to respond to the clamor of the community in general; The first
measures to implement to lower the insecurity rates.
1- Meetings for prevention will be resumed with the Preventive Front, Popular
Power, UBCH, Communal Councils, Clap Leaders and the Bolivarian Militia.
2- Constant point-to-foot patrols will be resumed in the most frequent places
inside and outside the Complex, as well as where robberies occur most frequently
and where drug sales are carried out.
3- The Social Intelligence system will be implemented with the support of the
Popular and Political Power of the Gran Victoria Complex to be more precise when
acting in crime prevention.
4- A Mobile Control Point will be activated at different times of the day at the
main entrance of Gran Victoria (at the roundabout), to inspect all vehicles and
people entering the Complex.
5- The incorporation of the Communal Police will be sought to reinforce the
Guidelines and carry out recreational days in which the Community is integrated.

With the support that is intended to be received from the inhabitants of all 17
Zones that make up the Complex and especially from the most affected Zones
such as 4, 5, 7 and 8 because they lived with these anti-socials and for them it is
traumatic, because they cannot even be in front of their apartments because they
are objects of robbery, but with the work of Social Intelligence that has been
carried out jointly by the Police-Community as a single front against crime, it has
been sought to control the criminal incidents that affect People, it is therefore that it
can be said that the criminals, and one can also mention the illegal sales of drugs
that also affected the peace and social tranquility of the People who live in the
different blocks of the La Gran Victoria Housing Complex, to be able to end the
Crimes and illegal sales of narcotics completely, which the only thing they do is
destroy our young people who are the future of Society, but I know that with the
support received from the community and the work that is intended to be carried
out with efficiency and constant dedication by a Police work team committed to
Security and taking into account the clamor of the People to address the issue of
Insecurity, the expected work has been achieved thanks to the Social and
Collective integration of all those affected.

b) SWOT Matrix (Strengths, Weaknesses, Opportunities and Threats).

SWOT matrix for strategic STRENGTHS (F) WEAKNESSES (D)

planning of Crime F1- COMMUNITY SUPPORT D1- HIGH CRIME RATES IN
Prevention in the La Gran PROVISION THE SECTOR.
Victoria Housing Complex F2- PROACTIVITY IN D2- LACK OF INTEREST ON
COMMUNAL MANAGEMENT THE PART OF YOUNG
F3- EXISTENCE OF PEOPLE IN IMPROVING
COMMUNAL POLICE IN THE THEIR QUALITY OF LIFE.
SECTOR. D3- ANTISOCIAL PEOPLE
FIND THEMSELVES
IMMERSED WITHIN THE
COMMUNITY BECAUSE
THEY ARE PART OF IT.
OPPORTUNITIES (O) FO STRATEGIES DO STRATEGIES
O1- RECOVERY OF THE
SPORTS FIELD BY THE F1,O1: ORGANIZE SPORTS D2,O1: INTEGRATE YOUNG
NATIONAL ANTI-DRUG ACTIVITIES TO MINIMIZE PEOPLE IN SPORTS DAYS.
FUND (FONA) LEISURE TIME AMONG D3,O3: GENERATE MORE
O2- SUPPORT FROM THE ADOLESCENTS. POLICE TRAVEL IN THE
PREVENTIVE FRONT FOR F3,O2: PLAN JOINT AREA SO THAT CRIMES
SOCIAL, CULTURAL AND ACTIVITIES WITH THE FEELS THE POLICE
SPORTS ACTIVITIES TO PREVENTIVE FRONT AND PRESENCE AND CRIMINAL
GIVE TALKS AND PROVIDE COMMUNITY POLICE FOR ACTS ARE MINIMIZED.
GUIDANCE TO THE GUIDANCE ON CRIME
COMMUNITY. PREVENTION.
O3- CRIMINALS FEEL F2,O3: SUPPORT THE
THREATENED BY THE ACTIVATION OF THE
CONSTANT POLICE POLICE POINT.
PRESENCE IN THE SECTOR.
THREATS (A) FA STRATEGIES DA STRATEGIES
A1- AREAS WITHOUT
ELECTRIC LIGHTING THAT F1,A1: CONDUCT D2,A1: TAKE ADVANTAGE
SERVE AS A HIDING PLACE WORKSHOP TO INSTALL OF YOUTH LEISURE AND
FOR CRIMINALS. LIGHT BULBS IN DARK INCORPORATE THEM IN
A2- LACK OF WEED AREAS IN CONJUNCTION LIGHTING ACTIVITIES.
CLEARING IN THE AREAS WITH GOVERNMENT D1,A2: TAKE ADVANTAGE
ADJACENT TO LA GRAN SUPPORT. OF THE PRESENCE OF
VICTORIA. F2,A2: ORGANIZE A CRIMINALS AND
A3- FEAR OF SOME WEEDING DAY WITH INCORPORATE THEM INTO
NEIGHBORS TO FILE COMMUNITY SUPPORT. WEED CLEARING
COMPLAINTS. F3,A3: GUIDE NEIGHBORS ACTIVITIES THROUGH
REGARDING THE LEGAL COMMUNITY WORK.
FRAMEWORK FOR THE
PROTECTION OF
WITNESSES AND
COMPLAINANTS.

POLICE MANAGEMENT AND FUNCTION

The Management Process

 New trends in Public Administration require entities to manage resources
more efficiently and to apply new processes that contribute to the good
performance and execution of public policies; however, all personnel linked to
Public Administration are required to recognize the importance of the good
execution of processes and to be aligned with a better use of resources and the
application of legal norms that cover management and public function.

In addition to the above is the police officer as the new manager, deserving
that within the police forces all personnel is in function of a good academic
development in the managerial and administrative part where apart from knowing
and marrying the security policies arising from public policies and that today, is
immersed in the training of each and every one of the Police officers where they
receive an academic training directed in the good execution of citizen security
strategies, leaving aside the importance of Public Administration as a fundamental
engine of the same institution, which is why the national government has
implemented strategies to academically train police officers in the area of
management and administration.

THE ADMINISTRATIVE PROCESS

a) Stages of the Administrative Process

The stages of the administrative process are:

1.Planning.
2.The organization.
3.The address.
4.The control.

1. Planning:

It is composed of that part that is in charge of seeing how something is going

to be done. That is, answering questions like this: What do we want to achieve?
What do we have to do to achieve our goal? Who will be responsible for each part
of the process to achieve the goal? When and within what time frame will each
action be carried out? What resources do we need? Where can we get the
resources? What is the cost of these resources? What kind of setbacks can we
encounter and how are we going to solve them if they arise? What do we do when
faced with a setback that we had not anticipated?

Ultimately, it is about everything that needs to be decided before getting

started. Without planning, you will just be running aimlessly. It doesn't matter if you
run fast if you don't have a plan.

2. Organization:

Once planning has been done, it is time to get organized. This is, put very
simply, sharing out tasks. Somehow make sense of all the questions you have tried
to answer in the planning stage.

Some questions to be resolved at this stage of the administrative process are:

In what order are we going to take care of the tasks? Who is going to be in charge
of each task? Are we going to do the tasks together or will each one be in charge
of one thing? When making decisions, will we do so democratically? Will the
hierarchy be horizontal or vertical?
While these questions may seem like part of planning, the focus here is on
conveying the concept. That is, it is a part that establishes how everything is
organized. So, when it is being executed, what organizational principles are
followed?

3. Address:

Management, contrary to what many people think, does not have to be in the
hands of a single person. It could also be led by a steering group. However,
management is responsible for helping, intervening, supporting or motivating the
work being carried out. For example, managers are responsible for influencing
project members. Whether by helping them, giving them alternatives or avoiding
conflicts between different parts of the organization.

4. Control:

It is defined as the monitoring of results and their measurement through

reliable metrics. So, based on the established metrics, the organization will try to
monitor activities to check whether the planned plan is being followed. That is, if
these intermediate goals are being followed, it helps us monitor that the main goal
is being met. Understanding the administrative process in two phases: the
mechanical phase (planning and organization) and the dynamic phase (direction
and control). It is very important to understand each stage sequentially. All stages
are important and interrelated.

b) The Administrative Process in Police Management

Within the administrative process, the functions of planning, organization,

direction and control are fulfilled, now when applied within the exercise of police
management, this initially serves as a driver of strategies so that the procedures,
processes and mechanisms used in the administration of police institutions can
have tools when generating the theoretical and practical elements necessary to
manage a police institution and each of its components.

Since the beginning of the exercise of Police Management in our country,

there have been a series of manuals and instruments that can be used for the
administrative management of police institutions. This is because specific manuals
have not been generated to be applied within police management, which generates
a lack of knowledge of concepts and terms that, in turn, leads to the administration
of police agencies being carried out with wide margins of discretion.
 From a management and administrative perspective, applying the stages of
the administrative process within the administration of police institutions will allow
police officers to improve their administrative capabilities, since having knowledge
about the administration of public institutions will help them apply it to the
administrative management of police organizations and adapt it to their processes
in order to optimize the quality of their operation.

Furthermore, it will allow officials to acquire a multidisciplinary vision of all the

components of public administration in Venezuela and the systems that comprise
it, which will generate an understanding from a global point of view of the realities
and demands that arise within the administrative sphere and that must be applied
within their administrative functions as an entity of the public sector, for some years
now the application of the administrative process within police management has
been taken as fundamental, however the police issue of being legendary and
hierarchical institutions that refuse to abandon their institutional doctrine, has been
an obstacle for them to successfully assemble these components into their
management, noting that for their operation they are required to comply with all the
guidelines required by the regulation of public administration.

In this sense, police institutions have found it necessary to assimilate the

models established by new global trends demanded by current organizations or
economic blocks, which are not only the responsibility of the state as such, but also
of each of the entities that comprise it, this being the reason why the
professionalization of police officers is required in order to be able to assign
responsibilities to suitable officials, which is representing a great advance within
police management in the search for institutional success, taking advantage of the
professionalization of each of the active police officers in favor of the search for
success of the institution and of the state itself.
 Police institutions within their operation cannot remain alien to the demands
of the global context, which requires societies and cultures to adapt emerging
paradigms to a new reality, which leads to the emergence of new crimes and
confrontations, forcing police management to opt for a new trend, not only
administrative, but also strategic in its constitutional reason, for this they have been
adapting to the foundations of administration in the public sector, in such a way
that it has served to have a vision of how the administration of police organizations
works and should be.

In this order of ideas, accountability is presented as a policy that conceives a

double impact: first, it meets the social demand placed on public officials to keep
society informed of the results of their performance, to make it transparent and to
explain the decisions taken. Secondly, the administrative process has allowed
police institutions to generate institutional knowledge to demonstrate both
achievements and deficiencies, as well as current opportunities to improve their
performance, which has given them the possibility of anticipating and solving
problems, in addition to giving continuity to the successes obtained, all for the
benefit of the communities they serve.

Likewise, work has been done to deepen knowledge regarding the general
principles of the internal control system of the Public Sector in Venezuela, relating
these internal control principles to the mechanisms of public accountability. In
addition, it has allowed him to understand the importance of internal control as a
process integrated into administrative management, deepening the knowledge of
the related concepts, the departments in charge of exercising said control, the
competencies and the legal framework that governs the administration of police
agencies at its three levels (Bolivarian National Police, State Police and Municipal
Police), covering the different types and scopes.

All of this without leaving behind the hierarchical model of administration,

which in some way may be representing that even today there are failures within
the administrative process of police institutions and that are affecting the
effectiveness and efficiency of the operational and financial results achieved in said
institutions, which is why the same state creates educational policies and
professionalization and academic updating so that our police officers are on par
with current demands.

Finally, it is important to add that police institutions have been adjusting to the
Public Administration, understanding and assuming that the latter represents a
fundamental axis in the Police Administration, given that the former serves as
support for the latter and allows the generation of strategies that support the proper
functioning of police institutions, taking into account that in order to obtain
successful results it is necessary to comply with the good follow-up and application
of regimes or guidelines imposed by any type of control entity and this is immersed
in the process.

Preparing a budget is a very important activity within organizations, and to prepare

it it is convenient to take into account the following factors: advantages offered,
limitations that arise when preparing a budget, differences between a public and
private budget, budget periods and subperiods, budget elements, duration of
budget periods, and what a master budget is.

This topic is very important within organizations, and that is why we will be
addressing the study of each of these factors throughout this work. It is expected to
be of great importance and interest to those who have the opportunity to study this
topic.

Advantages of budgetsMonografias.com
Budgets can be prepared in different ways, depending on the desired complexity.
All of them carry a number of advantages, even the simplest budgets present
enormous advantages for internal and external reasons.
Below are some advantages:

1. It requires management to specify medium and long-term objectives.

2. It forces management to analyze future problems, so that they can identify

different alternatives.

3. Direct effort and investment towards the most profitable alternative of all.4. It
emphasizes the need for coordination between all elements of the company, as it
allows the weaknesses of an organization to be quickly seen.

5. It serves as a means of communication.

6. Provides operating rules that serve to obtain better performance.

7. Indicates areas of lack of control, providing data that can be used to analyze
variances between actual and budgeted values. These variances serve as a
platform for studying the cause of the problem.

Budget Limitations
Sudden changes in the environment, new legal provisions and unexpected
business events such as strikes and accidents can throw the process out of
balance.

The main limitations include the following:

- They are based on estimates.

- They must be constantly adapted to important changes that arise.

- Its execution is not automatic, its importance needs to be understood.

- It is an instrument that should not take the place of administration.

The reasons why budgets and planning are not more successful include, but
are not limited to, the following:

1. Management's inability to understand its system.

2. Managers worry about details or try to control the wrong factors.
3. Lack of support from management for the budgetary system.
4. General management does not support the activity or does not participate in it
meaningfully.
5. The inability to understand the critical importance of the role of budgets in the
administrative process.
6. Excessive involvement in or undue reliance on the budget process.
7. Inadequate evaluation and mismatches between products and markets