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Business > Chapter 6 - Achieving Business Goals > Flashcards

Chapter 6 - Achieving Business Goals Flashcards

1
Q

Benefits of goals for managers

A
  • serves as targets = decisions are easier to make is one understands what the business is trying to achieve
  • measuring sticks = goals act as benchmarks
  • motivation = goals represent a challenge or an aim
  • commitment = getting am employee to achieve or participate in a goal setting process provides a personal stake in the success of a business
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2
Q

What are some financial goals?

A
  • to maximise profits
  • increase market share
  • grow/expand
  • improve share price
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3
Q

What are some non-financial goals a business might set?

A
  • social goals

- environmental goals

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4
Q

What is profit maximisation?

A

Occurs when there is a maximum difference between the total revenue (the number of sales made x the price) coming into the business, and total costs being paid out

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5
Q

How can you maximise profits?

A
  • increase sales, as consumers will purchase more
  • create innovative products
  • deliver better services
  • create a well-targeted marketing campaign
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6
Q

What did Virgin Airlines do when they first began operating?

A
  • they initially set very low prices to tempt passengers away from established carriers
  • Virgin has a long term goal ‘the desire to maximise profits’, but they understand this will take years to achieve
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7
Q

What is market share

A

Refers to the business’s share of the total industry sales for a particular product

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8
Q

Why is it important for a business to have a large market share?

A
  • because small market gains often translate into large profits
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9
Q

How do large businesses increase their market share

A
  • develop an extensive product range using many different brand names
  • merge/acquire (with) another business
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10
Q

What is promotion

A

Describes the methods used by a business to inform, persuade and remind a market about its products

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11
Q

Why might some businesses not wish to grow?

A
  • avoid the added pressures of expansion in a desire for a quiet life or a particular lifestyle
  • maintain personal contact with the customers
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12
Q

How can a business grow externally?

A
  • merging with another business (e.g. when Qantas merged with Jetset Travel)
  • acquiring another business (e.g. when Coca-Cola Amatil purchased Neverfail Springwater and Mount Franklin bottled suppliers)
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13
Q

How can a business undergo internal growth?

A
  • employ more people
  • increase sales
  • introduce innovative products
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14
Q

What is a share

A

Part ownership of a public company

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15
Q

Why do people buy shares?

A
  • in the hope of selling them for a higher price
  • owning shares in a company entitles an investor to a part of the company’s profits, which is distributed in the form of dividends
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16
Q

How do companies maximise the returns of their shareholders

A
  • achieved by keeping the share price rising, and paying back healthy dividends
17
Q

What are three main social goals?

A
  1. Community service - business sponsorship of wide range of community events, promotions and programmes
  2. Provision of employment - employing family members
  3. Social justice - employees and community members treated fairly
18
Q

How are businesses reaching environment goals?

A
  • sustainable development (e.g. Club Assist, SITA Australia, Johnson and Johnson)
  • governments imposing stricture environmental regulations on business practices
19
Q

How have Club Assist been environmentally friendly?

A
  • they branded batteries are made using recycled lead and plastic
  • developed battery recycling programmes designed to maximise collection rates for batteries
20
Q

Why can it be difficult for businesses to achieve all their financial and non-financial goals simultaneously?

A
  • because links between goals make some incompatible and/or conflict with each other
  • e.g. maximising profits CONFLICTS with increasing market share
21
Q

To be effective, business goals should be S.M.A.R.T.

What does this stand for?

A
  • S pecific
  • M easurable
  • A chievable
  • R ealistic
  • T imebound
22
Q

What is staff involvement

A

Involving employees in the decision making process and giving the, the necessary skills and rewards

23
Q

Staff will only be successful if a business provides employees with the necessary expertise as well as recognising the importance of:

A
  • innovation
  • motivation
  • mentoring
  • training
24
Q

Innovative activities of staff are referred to as…

A

Intrapreneurship within the business

25
Q

Tips for motivating staff

A
  • communicate regularly with staff
  • make clear expectations
  • delegate responsibility
  • encourage suggestions
  • provide safe working environment
26
Q

Rewards/Tasks that motivate people (not money incentives)

A
  • provide interesting work which is challenging and rewarding
  • train your staff
  • offer opportunities for employees to advance
  • show respect and courtesy
  • listen to your staff to find out what motivates them
27
Q

Define mentoring

A
  • the process of developing another individual by offering tutoring, coaching and modelling acceptable behaviour
28
Q

What is socialisation

A

The process a new employee undergoes in the first few weeks of employment through which he or she learns how to cope and succeed

29
Q

Why can a formalised mentoring programme be beneficial?

A
  • ensures access to mentors of all employees, regardless of levels of experience, backgrounds, gender or ethnicity
  • the participants in the mentoring relationship know what is expected of them
  • it assists with training and development of all employees, and passes on skills and abilities
  • provides career and physiological support - a friend + counsellor
  • increases possibility of skill transfer
30
Q

What is employee training

A

Generally refers to the process of teaching staff how to perform their job more efficiently and effectively by boosting their knowledge & skills

31
Q

Multi-skilled employees are better able to:

A
  • adapt to a rapidly changing technological environment
  • provide better customer service
  • participate effectively in work teams, leading to innovation
  • gain promotion, making their commitment to the business greater
32
Q

What are the goals of training employees

A
  • improve employee productivity

- develop multi-skilled employees

Business (12 decks)

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