Business Objectives And Stratergy Flashcards
Stakeholder objectives
Owner- they want the best possible return on the money they have invested into the business, they want to see it grow. A long term objective could be a high rate of return but a short term objective could be the increase of growth through lower prices.
Employees- want the highest wage that they can get, bonus if possible and job security. They also want more offers on legal entitlement like sick pay and holiday pay. They want more opportunity and for things to get more challenging.
Customers- want the best quality products for the lowest possible price. They also want innovation, good service.
Suppliers- suppliers want to see customers prosper so they have regular profit and repeat orders rather than just one offs. Suppliers want to be paid as promptly as possible. If this is the case they will be most likely loyal to the business
Lenders- banks want the agreed amount owned to it to be paid at the agreed time.
Community- they are affected by business activity. For example as more businesses move in one area local authorities may improve things like roads to make it easier for residents to drive around. However this will then mean additional congestion and pollution on the roads.
Government- the more people that are employed the less security benefits they will have to pay out, they will also receive an increased tax revenue from the business and its employees. As the business grows larger it may start to export improving the uk trading position.
What are private costs and benefits
Costs a business pays and the benefits it gets from its activities
What are social costs and benefit d
The true cost of a businesses activities taking into account of the external costs and benefits as well as the private ones
Aims of businesses
- survival
- breaking even
- share of the market and growth
- profit
Explain what is meant by the hierarchy if objectives
Shows how the different levels of goals interconnect
Looks at…
Aims, objectives, mission and visions
Distinguish between organisational aims, corporate / business objectives, strategic objectives, tactical objectives and operational objectives
Organizational aims- long term goals reflecting the purpose or mission of a business
Corporate objectives- specific and measurable target aligned with the overall aims
Tactical objectives- short term objectives to achieve the businesses strategic objectives,
Strategic objectives- long term goals focusing on overall growth and direction.
Operational objectives- short term day to day targets to ensure smooth functioning
Social objectives- ways to satisfy e.g. being environmentally friendly
Changing objectives- overtime due to circumstances changing businesses need to adapt their objectives
Explain the importance of setting SMART objectives to a business and its stakeholders
Specific
Measurable
Agreed- if an agreement is formed its more likely objectives will be achieved
Realistic
Time bound
Importance
Clarity- helps stakeholders understand what needs to be achieved
Measureability- progress can be tracked and evaluated
Motivation- clear targets inspire employees
Accountability- stakeholders are responsible for achieving specific results
Explain how the sector in which a business operates affects its aims and objectives
Primary sector- focuses more on sustainability and resource efficiency
Secondary sector- aims at productivity and cost reduction
Tertiary sector- customer satisfaction and service quality are seen as a priority
Public sector- aims at social welfare rather than profit
Third sector- focuses on the social impact rather than the financial gain
How can objectives be communicated
- meetings so updates and feedback can be given
- internal communications such as emails or newspapers
- visual like posters
- training
