1.5.3 Business Objectives

Question 1

Mission statement

Answer 1

A qualitative statement of the businesses aims.

Question 2

Features of a mission statement

Answer 2

• The overriding goal of the business.
• The reason for its existence.
• A vision for the future.

Question 3

What makes a good mission statement?

Answer 3

• Excites, inspires, motivates and guides.
• Differentiates the business from it competitors.
• Defines the market or business in which the firm wants to operate.
• Relevant to objectives and therefore enables progress towards them to be measured.

Question 4

Aim

Answer 4

A long term plan from which objectives are derived.

Question 5

Objectives

Answer 5

Targets which the business adopts in order to achieve its overall corporate aims.

Question 6

Examples of objectives

Answer 6

• Survival
• Profit maximisation
• Sale maximisation
• Customer satisfaction
• Market share
• Employee welfare
• Cost efficiency

Question 7

Purpose of objectives

Answer 7

• Motivate employees.
• A measure of performance.
• Provides a clear focus for decision making.
• Provides a sense of unity.

Question 8

Corporate objectives

Answer 8

The overall business targets.

The corporate objectives translate down to each department or function.
Marketing, Human resources, Finance, Operations.

Question 9

Factors influencing whether or not objectives are fulfilled?

Answer 9

• Competition
• State of the economy
• Age of the business
• Legislation
• Social attitudes – consumers
• Market conditions
• Political factors