3.1a business objectives and strategy Flashcards
what is an aim?
a long-term goal (1 year +)
what is an objective?
a short-term goal that helps a business to achieve its aim
what do corporate objectives and mission statements do?
outline what the business aims to achieve:
↳ it guides the actions and strategy of business
what is a mission statement?
it explains the purpose of a business (why it exists)
who does the mission statement relate to?
(+ examples)
all stakeholders
(investors, customers, employees, society)
what does the mission statement focus on?
-the values of the business
-the importance of different stakeholder groups
-the impact the business intends to have on society
-the aims of the business
what is a mission statement not intended to be?
-a statement of objectives or what the business does
-a statement of how the business intends to compete / position itself in the market
hierarchy of objectives:
-aim
-mission
-corporate objectives
-functional objectives
-business unit / individual target
some of the influences on a mission statement?
-the values of the founder(s)
-the industry the business is in
-the size of the business
what makes a good mission statement?
-a clear sense of business purpose
-excites, inspires, motivates, guides
-easy to understand & remember
-differentiates business from competitors
-for all stakeholders
what can mission statements be used to develop?
corporate objectives
EXAM TIP!! what may i be asked to do with mission statements in a test?
-critical appraisals
-assess the importance of
critical appraisal of nike’s mission statements:
‘to bring inspiration and innovation to every athlete in the world’
-may be outdated
-nike is seen more as an everyday fashion brand now
common criticisms of mission statements:
-not always supported by the actions of the business
-often too vague
-can be outdated
-can be unmemorable
where do corporate objectives fit in on a hierarchy?
mission
→
vision
→
aims or goals
→
corporate objectives
what is the vision of a business?
the overall aspiration (hope/ambition) of the business
what is a corporate objective?
it quantifies the mission of a business and sets measurable targets for the whole business
hierarchy of business objectives:
(increasingly strategic)
-mission
-corporate / strategic
-functional
-team
-individual
(increasingly detailed)
example of corporate objective:
market share of 12%
example of a functional objective:
sales per customer of £45
example of a unit objective:
shop sales of £500,000
what is the purpose of corporate objectives:
-to measure the performance of the whole business
-to inform decision-making
what are functional areas of a business?
marketing, operations, HR and finance
examples of key focuses for corporate objectives:
-market standing
-innovation
-productivity
-resources
-profitability
-management
-employees
-public responsibility