Theme 3 - 3.1.1 - Corporate Objectives Flashcards
Whats another name for business ?
Corporation
Whats a mission statement defined ?
A mission statement is a qualitative statement of an organisations aims
Whats the hierarchy of business objectives ?
Mission statement —> Corporate Objectives —> Department Objectives
What are mission statements ?
And give some examples
It is a short way of a business expressing their main intent
Example - Nikes mission statement - ‘to bring inspiration and innovation to every athlete in the world’
It’s a document written by a business which should provide general aims for all the employees to work towards - critics say that mission statements are just a PR tool
A mission statement sets out the purpose and primary objectives of a business
What should a mission statement be ?
- A mission statement should be memorable
- A mission statement should be inspiring
What are corporate objectives ?
Corporate objectives should flow from the mission statement and corporate vision
They are usually set by senior management for the whole company
Aimed at satisfying the shareholders so mayo be related to profit or dividends
Objectives need to be SMART
Whats a corporate vision ?
A corporate vision looks towards the future and where the business would like to be
What are SMART objectives ?
Specific - this means there must be a clear definition, often including a number
Measurable - This means the achievement can be checked
Achievable - This means you can achieve your target but you may need to stretch yourself
Realistic - This means that the target should sensible so that you can achieve it
Time-related - this means setting a date for achievement or review
Whats an example of a SMART objective ?
To achieve a 40% share of the total sales in the children’s clothing market within five years
What are department objectives ?
in most businesses there divide up the work into departments of functions: sales, marketing, Human Resources, operations and finance
Then each department will set their own objectives which should flow from the corporate objectives
For example the marketing department may aim to increase sales revenue 2% each year
This will help the business to achieve its corporate objectives of more dividends for the shareholders
Whats the purpose of mission statement ?
A mission statement can define the essence or purpose of the business in just a few sentences
It’s the purpose of the business that it key in the statement
Who is the intended audience for a mission statement ?
EA games mentions audience in their mission statement
EA outreach engages our players and employees to improve lives through education programs and initiatives that foster a culture of inclusion.
What are the uses of mission statements ?
Focus - helps to focus and involve all employees in the business
Profitability - helps to motivate employees to become more efficient which could have an impact on profitability
Identity - helps to create an identity in a competitive marketplace
What are the limitations of mission statements ?
- Can be unrealistic and over optimistic
- Can be a waste of management time and resources
- Can lead to conflicts and inconsistencies when not properly written
- Can be ambiguous
- Can become obsolete s the business develops but the mission statement remains the same
What are the stakeholders perspectives on mission statements ?
owners - owners will want to maximise shareholder value of the business
Managers - Manager will look for core aims and objectives of the business to lead their staff / teams with
Employees - Employees will look for
motivational statements that make them feel proud to work for that company
Pressure Groups - Pressure groups will look for a clear environmental or ethical message in the mission statement
Customers - Customers will look to see core business principals that are ethical
Competitors - Competitors will look to see if the business is visionary, competitive, innovative and organised
