21. Business objectives Flashcards
Businesses need to have clear objectives for the following:
- Employees need something to work towards. Objectives help motivate people.
- Without objectives owners might not have the motivation needed to keep the business going. Owners might loose control and allow their business to become passive and aimless.
- Objectives help owners decide where to take a business and what steps are necessary to get there.
SMART
- Specific
- Measurable
- Agreed
- Realistic
- Time specific
One of the most importante objective of new businesses is…
SURVIVAL
Profit maximistaion
If profit is wanted to increase, they will focus on keeping costs as low as possible while raising pices as high as they can befor customer loyalty is damaged.
Sales maximisation
An attempt to sell as much as possible in a given time period
Market share:
Business prefer to have a high market share and therefore increase market share is a common objective of businesses
Cost efficiency:
Businesses may consider how to reduce their costs. It is an objective that might be pursued when trading conditions become difficult due to more competition or an economic downturn.
Employee welfare:
Some businesses objectives is employee welfare as they realised that when needs of employeed are met, they work more effectively, be happier and more motivated, more flexible and less likely to leave
Customer satisfaction:
Most business will try to meet customer needs. If customers are satisfied they are more likely to return.
Social objectives:
A business that sets social objectives is one that shows concern for the local area.
(keeping noise down, maintaining sensible openning hours, minimising pollution, employement for local people…)
Objectives:
- Survival
- Profit maximisation
- Sales maximisation
- Market share
- Cost efficiency
- Employee walfare
- Customer satisfaction
- Social objectives
aims
what a business tries to achieve in the long term
objectives
the goals or targets set by a business to help achieve its long-term purpose
