3.71- Mission statements, corporate objectives and strategic decisions

Question 1

What is a mission statement?

Answer 1

Sets out a businesses overall purpose to direct and stimulate the entire organisation (ie what the business does)

Question 2

What is a vision statement?

Answer 2

Sets out a businesses aspirations for the future

Question 3

What are strategic decisions?

Answer 3

Are judgements made by senior managers that are long- term, involve a major commitment of resources and are difficult to reverse.

Question 4

What are corporate objectives?

Answer 4

Are medium to long-term goals established to coordinate the busines

Question 5

Flow chart that includes- corporate strategy, vision statement, strategy, and mission statement

Answer 5

Mission statement–> vision statement–> strategy–> corporate objectives

Question 6

Internal influences on mission statement?

Answer 6

TYpe of industry
Target market
Type of products
Financial/ size/ type of business
Environmental concerns
Company culture

Question 7

External influences on mission statements?

Answer 7

State of the economy
Competitors
Political
Unemployment

Question 8

What departments/ areas of a business may have corporate objectives?

Answer 8

Customer service
HR
Marketing
Finance
Logistics
Innovation/ research and devlopment

Question 9

What is short-termism?

Answer 9

The pressure to deliver quick results to the potential detriment of the longer term development of a company

Question 10

What are shareholder returns?

Answer 10

The financial benefits gained by shareholders from buying a company’s shares and are the combination of an appreciating share price and dividends paid.

Question 11

What are dividends?

Answer 11

A sum of money paid regularly (typically annually) by a company to its shareholders out of its profits (or reserves)

Question 12

What is culture?

Answer 12

Encompasses the values, attitudes and beliefs of those who work for a business

Question 13

What happens with short-termism?

Answer 13

Think more tactical
Maximise profits
Maximise dividends
Cut costs
Cut staff
Less training
Less R&D

Question 14

Impact of short-termism

Answer 14

Market share may fall
Image of business may suffer
Motivation of staff may suffer
Opportunity cost

Question 15

What is strategy?

Answer 15

The long-term plan to achieve the business vision through attaining its corporate objectives

Question 16

What are tactics?

Answer 16

Are short-term decisions, usually involving relatively few resources, that are made to implement a strategy

Question 17

What are functional decisions?

Answer 17

A judgement taken by managers responsible for one aspect of a business activities, such as marketing or HR

Question 18

What is SWOT analysis?

Answer 18

A business planning tool that considers the internal strengths, weaknesses and the external opporutinity
, threats.