1.3 Business objectives Flashcards
vision statement
a long term goal, a dream or understanding of what the future would look like
mission statements
a short statement that defines what the organisation does, right now, in order to achieve its vision
vision and mission statements are seen by who
interested parties see it
workers also see it to be motivated to work
value
all the benefits the a business creates for the stakeholders involves
objectives
A stated outcome that a business aims to achieve; can be broadly stated in vision and mission statements, or more narrowly stated with measurable outcomes.
follow SMART criteria
when a business focuses on growth it..
wants to expand its business in terms of revenue, profit, number of employees etc
what does the business do when it grows
it increases its revue and reduces it unit of average cost= increase in profits
value extraction
prioritizing profits for shareholders can result in what economics call value extraction which is when one group of stakeholders captures for itself a very large portion of the value created by a business.
Corporate social responsibility (CSR)
business actively seek ways to improve society and the environment through core business activities and business desighns
what should ceos do for the csr
businesses should be optimising and distributing value for multiple stakeholders instead of maximising value for just one group.
generative (regenerative) businesses,
A business that aims to strengthen its social and environmental ecosystems by creating opportunities for other businesses and communities to develop, and by restoring the natural environment. The business enjoys a network of mutual benefits and increased resiliency.
local-social responsabilities
provide a secure network for local community
biomimicry
The process of mimicking nature’s forms, processes and systems to solve human problems.
global-ecological responsabilities
reduce its CO2 emissions by using more renewable energy
reduce its water usage or recycle wastewater
source its raw ingredients from farms using regenerative agriculture that promotes biodiversity
use transportation methods that do not cause air pollution
limitation of the CSR
- shareholders may need educating in the benefits of long term objectives
- csr will increase cost production
- if business doesnt follow csr comitments there is reputational risk
strategy
plan that an organisation creates in order to reach a specific goal. significant decisions ad actions
how of the business
linear production
taking resources from the earth, making products with thhem, then disposing of the producs
circular production
reducing waste by making sure that the outputs of the production system feed back into the system
STEEPLE factors- move towards circular systems
socio cultural- consumers are more aware than ever of ethic and sustainabilities of business- they expect system-wide change
technological factors- ability for entrepeneurs to connect and share ideas globally.
ethical factors- do the right thing
political factors- raw materials can only be get in certain areas- cause political conflicts
legal factors- laws require source sustainable
tactic
small action that a business takes to reach their goal
principals of circular economy
eliminate waste and pollution, circulate products and materials regenerate nature
circular supply models
a business model that enable businessses to reduce new material inputs, replacing them with recovered or bio-based materials
resource recovery models
focus on business of collecting sorting and processing waste materials
product life extension models
focus on extending the time that a consumer uses a product
aims of product life extensin models
design for durability
reuse and repair
remanufacturing
sharing models
allows consumers to share use of product with strangers- like an airbnb
2 types of sharing models
co-ownership= lending phyical goods
co-access= allowing others to take part in an activity that would have occured anyways
product service system models
selling the service of using a product
2 types of product service system models
product orientated service- focus on selling proucts and associated services
user orientated product service system models= temporary access to product
negative effect of circular business models
- undeveloped systems for waste recovery
- less land for food production
- unintended consequences
- rebound effect
- dont adress social issue
