short term vs long term Flashcards
1
Q
define corporate timescale
A
refers to strategy and the expectation of when a return on investment will be achieved
2
Q
what is short-termism?
A
prioritise short-term rewards over long-term development
- tactical
3
Q
why would a business be short-termist?
A
- profit focus
- shareholder pressure (dividends)
- bonus culture
- need to survive current conditions
4
Q
what are the effects of being short termist?
A
- lack of investment into: current/future products, new technology, new markets, workers
5
Q
what is long termism?
A
focus on sustained growth for rewards in the future
- strategic
6
Q
what are the effects of being long termist?
A
- over-ambitious
- loss of focus on what is successful NOW
- open to the impact of external shocks
- costs compared to revenue generated
- long term plans need short term steps
7
Q
what are the advantages of being long termist?
A
- sustainable growth
- r&d at the forefront of planning
- focus on meeting customer needs
- incorporates corporate social responsibility
- considers ethical behaviour of the business in decision making
