3.1.1 Corporate Objectives

Question 1

What is the hierarchy of objectives?

(The triangle diagram)

Answer 1

• Aims
• Mission Statement
• Corporate objectives
• Functional Objectives

Question 2

What is the ‘aim’?

Answer 2

• What the business is looking to achieve in the long term
• Often expressed as an overall vision and describes the businesses reason for being.

Question 3

What is a mission statement?

Answer 3

• An expression of a businesses overall aim as well as its core values and context
• Informs the development of corporate and functional objectives
• Often expressed in inspirational terms to provide direction and a common purpose for employees

Question 4

What is a corporate objective?

Answer 4

• The specific performance goals set by senior management for the business to achieve overtime
• Corporate objectives may focus on acheiving specified levels of market share, profit, sales growth or new product/market development

Question 5

What is a functional objective?

Answer 5

• The day to day goals of functions or departments within the business, derived from corporate objectives
• Functional objectives must be carefully aligned and cross departments so that all parts of the business are working towards the shared goal

Question 6

What are the SMART objectives a business uses?

Answer 6

• Specific
• Measurable
• Agreed
• Realistic
• Time-bound

Question 7

What are the critical apprasials of mission statements and corporate aims?

Answer 7

• Businesses need to critically assess whether corporate aims and mission statements continue to reflect current corporate vision
• The content & expression of business aims will likely change over time to reflect changing social attitudes & norms
• Businesses should decide whether changes to the corporate aim or mission statement need to be made by considering whether:
• Short- to medium-term strategies adopted by the business support the aim and mission
• The aim and objectives are realistic & achievable in the current trading environment
• The mission statement message communicates effectively the aim of the business with stakeholders
• Revising the business aim & revisiting the mission statement should be seen as natural step for growing businesses
  It is a chance to involve a variety of stakeholders including workers & suppliers in determining the direction of the business