3.1.1 corporate objectives Flashcards

1
Q

What is the hierarchy of business objectives?

A
  1. mission statement and general ais
  2. corporate objectvies
  3. department objectives
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2
Q

What is a mission statement?

A

A brief statement written by a business and describing its purpose.
- make a commitment to customers, bring a workforce together with a shared purpose

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3
Q

What are the advantages of a mission statement?

A

-Provides identity to a business
- gives a sense of direction employee -can remain focused on their purpose- increases motivation

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4
Q

What are the disadvantages of a mission statement?

A
  • workers may not agree
  • may not be realistic or achieveable
  • can be ambiguous
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5
Q

What is a corporate objective?

A

They are objectives that relate to a business as a whole
- set by senior management
- provide focus for more detailed objectives
-flow from the mission statement
- tend to focus on business performance and desired results

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6
Q

What is a SMART objective?

A

Specific
Measurable
Achievable
Realistic
Time based

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7
Q

What are department/ functional objectives?

A

work is divided into departments eg. sales, hr
- each department will set its own objectives which should flow from the corporate objective
- helps a business to achieve its corporate objective of more dividends for the shareholders

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8
Q

What are examples of objectives for small businesses?

A
  • ensure company breaks even at the end of the year
  • improve the firms liquidity in the next 6 months
  • to hire 5 staff with skills in marketing
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9
Q

what are examples of objectives for large businesses?

A
  • improve profits by 20% in the next 5 months
  • increase market share
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10
Q

What is asked during critical appraising of mission statements?

A
  • who is the intended audience?
  • what is the purpose of their mission statement?
  • how does the strategy that the business follows fit with their mission statement?
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11
Q

What is the purpose of a mission statement?

A
  • focus
  • identity
  • profitability
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