Chapter 4 Flashcards
Nature and importance of business objectves at corporate, departmental and individual levels
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Corporate social responsibility as a business objective
Corporate social responsibility is when businesses consider the concerns of the society and the impact their business has socially, as well as environmentally. This is show by taking responsibility for their actions’ impact on stakeholders and going out their way to keep clean.
CSR disadvantages
- Expensive
- can lower profits in short term
- non profitable as its easier to pay lower wages but business has to raise them
- buying from local communities over cheaper sources
CSR advantages
- Clean slate
- Get to prove they’re ethical
- Better reputation
- More trustworthy
- Positive publicity of being green
- CSR might be able to pay for itself through PR, marketing, motivation
- avoid legal issues with environmental laws
Relationship between mission statements, objectives, strategy, and tactics
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What are the different stages of business decision making?
- Set objectives
- Asses the problem of the situation
- Gather data about the problem and potential solutions
- Look at all decision options
- Make the strategic decision
- Plan and carry out the decision
- Review its success and more detailed goals than aims and objectives that are SMART
The role of objectives in the stages of decision making
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How objectives might change over time
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How ethics may influence business objectives and activities
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What are aims?
Aims are long term views for the company
What are targets?
Goals that are smaller than objectives and short-term
What is a mission statement used for?
Motivating employees and making employees aware of what they are supposed to do
What are strategies? But
Long term plans of action of a business that focuses on achieving the business’ aims
What do objectives have to be?
Specific Measurable Achievable Relevant/Realistic Time-phases
Why are corporate objectives important?
A
Why are individual objectives important?
L
Why are departmental objected important?
E
What are examples of a few corporate objectives?
- profit maximisation
- profit satisficing
- growth
- increasing market share
- survival
- maximising short term sales revenue
- maximising shareholder value
- CSR
How does the corporate objectives change with the size and form of a business?
Smaller business might be more interested in objectives like profit satisficing for more free time and less working overtime
A larger businesses might want to profit maximise if they’re already developed
Larger business that want more status or power might be concerned with growth
How does whether the business is in the the public or private sector affect the corporate objective of the business?
Public sector business aren’t profit driven and focus on providing public services
Private sector businesses are profit driven
How does the age of the business affect its corporate objective?
New business often lean towards objectives like survival as the first 3 years have a high failure risk
Established business will have bigger objectives, like growth or profit
Objectives important in decision making
A
How do budgets work when we are talking about objectives?
A
How does the communication of objectives affect the workforce?
- employees better understand the bigger picture
- shares employee responsibility
- managers and employees achieve more through understanding the goals
Why is corporate culture important?
It is important because it influences the working style of the employees and the business itself, the code of behaviour of staff, their attitudes and therefore performance too, as well as the decision making style of a business
What is profit satisfying>
4
What is profit maximising?
3
What should be taken into consideration when talking about a business’ objectives?
Their size and legal structure
Private or public sector
The age of the business
Merit goods effect on… (class test q)
77
What are the benefits of good communication with employees about target setting and objectives?
- achieve more through better understanding
- recognise overall plan
- linking of goals with others to form shared employee responsibility
What should the ethical code of conduct do?
It should explain the way in which employees should behave and make decisions in morally questionable situations
What are the benefits or short, medium and long term objectives?
T
How can you make tasks and objectives specific to each department, manager and employee?
Management by objectives
