Theme 3 section 11

Question 2

What is the mission of a business?

Answer 2

Overall purpose and main corporate aims

Question 3

What is a mission statement? What are they intended to do?

Answer 3

Written description of these aims
Intended to make stakeholders aware of what the business does and why and encourage all employees to work towards these aims .

Question 4

What are 3 things missions statements can tell you about a business?

Answer 4

Shared purpose
Purpose
Beliefs

Question 5

How can a mission statement tell you about the purpose of a business?

Answer 5

Can include information such as values and standard.
How it will achieve its aims
Who the customers are and what makes the business unique.

Question 6

How can a mission statement tell you about the beliefs of a business?

Answer 6

Can mention ethics and principles.
Gives a hint that ethical practices is important as well as profitability

Question 7

How can mission statements help employees? Does it help the business overall?

Answer 7

Gives them a shared purpose
Encourage them to work together to achieve a common goal
Having the cooperation of all staff can help business achieve its aims.

Question 8

Give 2 reasons why mission statements aren’t helpful?

Answer 8

Businesses don’t have to give accurate information.
The mission statement is limited.

Question 9

Explain how inaccurate mission statements affect consumers?

Answer 9

Business can say what they think consumers want to hear without doing anything about it.
This is a bad practice and business reputation can be damaged
If consumers find that its actions don’t make its stated values.

Question 10

How does mission statements which aren’t detailed affect other strategies e.g tactics and cooperate strategies.

Answer 10

It’s its limited and doesn’t go into detail on how the mission statement will be achieved
It doesn’t set out any corporate strategies or tactics.

Question 11

What does critically appraise mean?

Answer 11

Assess the effectiveness of.

Question 12

To empower out customers to have individual pride in their personal growth
How is this mission statement bad?
Think of investors , customers and stakeholders

Answer 12

Purpose of business isn’t said - and difficult to measure if aims is achieved not specific
Doesn’t say how it will achieve its aims so stakeholders might be sceptical and might not be confident in business
Clearly aimed at customers more than other stakeholders. Investors might not feel confident if the business can succeed so won’t invest
It’s clear they value their customers
Choice of language ‘our customers’ might make customers off it’s better to use ‘you’ as it’s more targeted and personal

Question 13

Why do businesses set objectives?

Answer 13

To achieve their mission

Question 14

Are objectives long term or short term?

Answer 14

Short-medium term
They turn corporate aims into specific goals

Question 15

What is the diagram of the hierarchy of objectives?

Answer 15

Mission statement
Department objectives
Corporate objectives

Question 16

What are corporate objectives?

Answer 16

Objectives for the business as a whole

Question 17

What do corporate objectives depend on?

Answer 17

The size of the business
New shop owner might have objectives of survival
Big international company will want to grow bigger and diversify product range

Question 18

What are departmental objectives?

Answer 18

Objectives of each department. They are more detailed than corporate objectives

Question 19

Why do businesses need to set departmental objectives?

Answer 19

To help them achieve their corporate objectives.

Question 20

How do managers set departmental objectives?

Answer 20

Whenever a corporate objective is set mangers look at how their department can achieve these objectives.
Then can then set departmental objectives that will contribute to achieve corporate objectives .

Question 21

How do departmental objectives help managers and employees?

Answer 21

Managers make sure everyone is working towards a goal and coordination between departments should improve.
Working towards an objective can motivate employees

Question 22

How do departmental objectives help decision making processes?

Answer 22

Makes it easier because you can see what the business is trying to achieve.

Question 23

What must objectives be aligned to? What happens if it isn’t?

Answer 23

Aligned to their mission statements.
Otherwise they could loose credibility with its stakeholders.

Question 24

What can managers do with the mission statement which helps them review their decisions?

Answer 24

Compare the performance with their objectives and measure the success of the business and review their decisions.

Question 25

What should objectives be? 5 letters

Answer 25

SMART Specific Measurable Agreed Realistic Timely

Question 26

Why do objectives have to be specific?

Answer 26

Vague objectives like ‘improved quality’ don’t tell staff what they are supposed to be aiming for. Making them more specific like ‘ reducing the number of defects items’ tells them and more likely the business which achieve this

Question 27

Why do objectives need to be measurable?

Answer 27

If it’s not measurable then business won’t know if it’s been achieved or not. E.g to increase profit by 5% is measurable but not ‘to improve the business’ isn’t.

Question 28

Why do objectives need to be agreed?

Answer 28

Everyone involved in achieving these objectives needs to know about it and agree to it. E.g if the objective is to increase sales then sales manager and sales people need to agree to it .

Question 29

Why do objectives need to be realistic?

Answer 29

No point of setting objectives which are too ambitious e.g tripling sales within 12 months or 95% market share. Impossible objectives will demotivate staff.

Question 30

Why do objectives need to be timely?

Answer 30

Should be a specific timeframe that objective will be achieved e.g with in 12 months if there’s no time limit then staff won’t see objective as urgent. They might not think they need to worry about achieving this objective They think as long it’s done it doesn’t matter .

Question 31

What is a strategy? What are they developed for?

Answer 31

Long term plan of action. Developed to achieve a business’s objectives

Question 32

When can a strategy be put into place?

Answer 32

Only when the aims and objectives have been outlined

Question 33

How are strategies for small firms different from strategies for large firms?

Answer 33

Small firms- don’t need to be written down. They can be a sequences of business objectives made overtime with the aim of reaching a particular goal. E.g expanding into new market segments. Large firms-strategy more clearly defined because it will influence the plans of individual departments such as marketing and HR

Question 34

What are tactics?

Answer 34

long term plan of action techniques businesses use to achieve their overall strategy.

Question 35

If a business has a strategy to expand its production what tactics can they use?

Answer 35

Recruit more staff

Question 36

How can tactics be used in an opportunity or threat?

Answer 36

Threat- if competitors cut their prices then they might have to even if their strategy is to increase profit. Sometimes they don’t always match a business strategy.

Question 37

Why is the distinction between strategies and tactics important for managers?

Answer 37

It gives them a rough time frame for the decision and how likely the decision will change.