2. business management- nature of management

Question 1

what are business goals

Answer 1

A business needs to have a clear idea of what it is trying to achieve; in other words, it needs clear goals and objectives.

A goal is a desired outcome (target) that an individual or business intends to achieve within a certain time frame.

Success in achieving business goals is often determined by the amount of planning. Detailed planning increases the likelihood of successfully achieving business goals

Question 2

examples of business goals

Answer 2

1. profits
2. market share
3. growth
4. share price
5. social
6. environmental

Question 3

what are smart goals

Answer 3

Specific - Goals should be straightforward and emphasise what the business wants to happen.

Measurable - Decide on goals whose progress can be measured so the business owner can see the change occur. This helps the business stay on track.

Achievable - Goals need to be challenging but not be too far out of the business’s reach, otherwise the business owner and employees will become unmotivated due to the lack of success.

Realistic - The goals must represent something that the business owner and employees are both willing and able to work towards.

Timebound - The goals must have deadlines and sub-deadlines attached to them, otherwise the commitment is too vague.

Question 4

what is the importance of setting goals

Answer 4

Serving as targets: With goals, managers at all levels would find it easier to make coordinated decisions because they understand what the business is trying to achieve.

Measuring sticks: Specific goals act as a benchmark against which the business can measure its performance — that is, the actual outcome is compared with the planned goal.

Motivation: Good quality goals represent a challenge — something to aim for. They act as a motivating force. Employees will gain satisfaction when they successfully achieve a challenging goal. Goals also provide managers with a basis for rewarding performance, which in turn acts as a motivator.

Commitment: Getting an employee to agree to achieve a goal — or better still, having the employee participate in the goal-setting process — gives that employee a personal stake in the success of the business

Question 5

levels and objectives

Answer 5

1. operational objectives
2. tactical objectives
3. strategic objectives

Question 6

what are the operational objectives

Answer 6

• determined by front-line management
• specific aims
• short-term - days/weeks

Question 7

what are tactical objectives

Answer 7

• determined by middle management
• specific aims
• mid-term - months

Question 8

what are strategic objectives

Answer 8

• determined by senior management
• broad aims
• long term - years

Question 9

achieving a mix of goals

Answer 9

*Business managers have a range of goals because they have a range of different stakeholders who have different needs.

*Thus, in practice, most business managers have a mix of goals.

*For managers however, it is not always easy to get the right balance of goals.

*Sometimes managers see conflict in these goals.

Question 10

what is staff involvement

Answer 10

*staff involvement involving employees in the decision-making process and giving them the necessary skills and rewards.

*Labor productivity measures how much an employee can produce in a set period of time.

*There are a number of ways in which managers can involve staff in order to achieve business success:

 Innovation
 Motivation
 Mentoring
 Training