1.3 Organizational objectives Flashcards
Vision statement
A statement of what the organization would like to achieve or accomplish in the long term.
Mission statement
A statement of the business’s core aims, phrased in a way to motivate employees and to stimulate interest by outside groups.
Business aims
The general and long-term goals of an organization.
Business objectives
Short- or medium-term goals or targets – usually specific in nature – which must be achieved for an organization to attain its business aims. These are often expressed as SMART objectives.
SMART objectives
- Specific
- Measurable
- Achievable
- Realistic
- Time-bound
Why are business objectives and aims important?
- to measure and control - help to control a firm’s plans as they set the boundaries for business activity
- to motivate - help to inspire managers and employees to reach a common goal, thus helping to unify and motivate the workforce
- to direct - provide an agreed clear focus for all individuals and departments of an organization
Tactic
Operational activities undertaken on a regular basis to implement the business strategy.
Strategy
A long-term plan of action for the whole organisation, designed to achieve a particular goal.
Need for changing objectives
Internal factors:
- corporate culture
- type and size of organization
- private vs public sector
- age of the business
- finance
- risk profile
- crisis management
External factors:
- state of the economy
- government constrains
- presence and power of pressure groups
- new technologies
Corporate Social Responsibility (CSR)
This concept applies to those businesses that consider the interests of society by taking responsibility for the impact of their decisions and activities on customers, employees, communities and the environment.
Ethical code of practice
A documented beliefs and philosophies of an organization.
Benefits of adapting CSR
- Improved company image
- Attracting new customers and loyalty from existing customers
- Attracting the best-motivated and most efficient employees
- Bad publicity and pressure group activity should not arise.
- Higher long-term profitability
Drawbacks of adapting CSR
- compliance costs
- lower profits
- stakeholder conflict
- ethics and CSR are subjective
SWOT analysis
A decision-making tool, it’s an acronym for Strengths, Weaknesses, Opportunities and Threats.
Strengths (SWOT)
Internal factors that are favourable compared with competitors.
