Corporate Objectives Flashcards
What is a mission statement?
It is the businesses overall purpose for existing or corporate aims. The mission statement is a written description of these aims and are intended to make all stakeholders aware of what a business is aiming to do and why; it should encourage all employees to work towards an aim.
What specifics may a mission statement include?
Values, standards, how they will achieve their mission, who they are selling to and why they are unique. They can give clues about a businesses beliefs - what it mentions may emphasise what the business stands for.
What is the issue with many mission statements?
Businesses are not obliged to tell the truth on their missions statements and may lie for PR purposes, but is risky and could damage their reputation if found to be lying. Additionally it is very brief and does not actually explain how a business will achieve anything.
What makes a good mission statement?
Clarity, easy to see their aims and how they aim to achieve them to provide a sense of belief.
Aimed at all stakeholders not just customers; all people want different things from a business so the business statement must emphasise their commitment to all stakeholders.
Targeted and personal.
What is the hierarchy of business objectives?
Mission statement - why the business exists on a broad scale
Corporate objectives- what the business wants to achieve in corporate terms
Departmental objectives- the objectives of each department.
Why do businesses set objectives?
To enable them to be able to achieve their mission and provide specific goals that must be met in the short to medium term.
What are corporate objectives? What do they depend on?
Goals of the business as a whole. Depends on the size and potential of the business. Initially, a new business will want to survive, where a large business will want to take risks and expand.
What are departmental objectives? How do they differ from the other objectives?
Each departments objectives. Most specific objectives and department specific. Will be written in detail about how each department will contribute to achieving corporate objectives and thus the mission statement.
Why do businesses set objectives?
Can ensure people collectively work to goals and business coordination should improve if everyone ones their roles in achieving a goal. Can motivate by giving people something to work towards and useful in decision making as it is easy to ascertain what a business is trying to achieve. Can be used to compare to performances to see how the business is performing and make changes if needed.
What should all objectives be?
They should be SMART
What are SMART objectives?
Specific,measurable, agreed, realistic and timely.
How can objectives be specific and why?
If they are vague they can be unclear and lead to mistakes, specifying will give employees a clearer understanding and increase the chances of success.
How and why measurable?
A business needs to know if they have achieved their goal and the extent to which they did - allows them to see how much or little change is needed to succeed in goals.
How and why agreed?
Everyone working towards an objective needs to know and agree to working for it - if all people know a goal then they can all do what they can in different departments to help the objective be achieved.
How and why realistic?
Impossible objectives are demotivating and pointless, people give up before starting which decreases productivity.
