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IB Business Management > Unit 1: 1.3 Business Objectives > Flashcards

Unit 1: 1.3 Business Objectives Flashcards

1
Q

What are business objectives?

A

measurable results businesses hope to maintain

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2
Q

What is a vision statement?

A

statement of what the organization would like to achieve in the LONG TERM.

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3
Q

What is a mission statement and what does it do?

A

a statement of the business’ core AIMS.
phrased in a way to
- motivate employees
- stimulate interest by outside groups
*can be changed as business develops

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4
Q

Corporate aims

A

aims expressed in the mission statement
- long term
- unmeasurable and qualitative
- set by senior level directors

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5
Q

Corporate objectives

A
  • SHORT TERM goals that are specific
  • expressed as SMART goals
  • quantifiable
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6
Q

Corporate strategies

A

long/short term plans of action to achieve the corporate objective

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7
Q

Targets

A

short term goals set for a department

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8
Q

The triangle levels of business strategy

A

Vision statement, mission statement, corporate strategies (the 4 functions), team strategies within functions of business, individual tactics based on team dept. goals.

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9
Q

What is the importance of objectives?

A

control, motivate, direct, and focus.

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10
Q

How is control an important aspect of objectives?

A

business plans + sets limits on business activity

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11
Q

How is motivate an important aspect of objectives?

A

inspire employees to reach common goal

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12
Q

How is direct an important aspect of objectives?

A

identify which aims to achieve and how to go about doing it.

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13
Q

How is focus an important aspect of objectives?

A

drives decision, making progress helps develop good teamwork

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14
Q

What is profit maximization?

A

bring in more money than you are spending

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15
Q

What does profit maximization do?

A

incentive to take risks
strategy should be long and short term

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16
Q

What is strategic growth

A

business’ intentional plans to achieve long term goals
- measured by revenue and market share

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17
Q

Benefits of strategic growth?

A

larger company =
- produce more at lower price
- market power, may have monopoly in market
- reduced risk, able to expand to other markets

18
Q

The image and reputation of a business

A

poor image = no profit
- companies often think that customer support are not as important as increasing productivity

19
Q

Advantages of ethical objectives of a company

A

corporate image
customer loyalty
improved employee motivation

20
Q

Disadvantages of ethical objectives of a company

A

take advantage of consumers + workforce
financial dishonesty
high cost to act ethical
lower profit

21
Q

What is corporate social responsibility (CSR)?

A

a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders. Classified by 3 types: free-market, altruistic, and strategic

22
Q

What is free-market CSR?

A

just make a profit + not to solve social problems. indirectly helping society

23
Q

What is altruistic CSR?

A

unselfish concern or devotion to the welfare of society. engage in CSR because they genuinely believe it is morally right.

24
Q

What is strategic CSR?

A

only act socially responsible if business will benefit from the act. engage in CSR to create profitability for the firm

25
Q

Why do business engage in CSR?

A

corporate image and reputation

26
Q

What is the Ansoff Matrix?

A

a growth strategy tool.

27
Q

Who uses the Ansoff Matrix?

A

sales managers

28
Q

What is market penetration?

A

selling existing products to existing markets. One way ____ can penetrate the market is by changing the price and using more promotions.

  • low risk
29
Q

What is product/service development?

A

selling new products to existing markets. One way ____ can develop a product is to ADD VALUE.

  • medium risk
30
Q

What is market development?

A

selling existing products to new markets. One way _____ can develop the market is to merge with another company.

  • medium risk
31
Q

What is market share?

A

the % of sales revenue a company has in a market

32
Q

What is the SWOT tool?

A

goals come from SWOT traits

33
Q

THE S in SWOT

A

strength
CAN CONTROL/CHANGE
what you do well

34
Q

The W in SWOT

A

weakness
CAN CONTROL/CHANGE
what you need to fix

35
Q

The O in SWOT

A

opportunity
CAN’T CHANGE NEED TO REACT TO IT
you will take advantage of

36
Q

The T in SWOT

A

threats
CAN’T CHANGE NEED TO REACT TO IT
you need to try avoid and can’t control it

37
Q

Advantages of CSR

A
  • improvement of image/products of the business = competitive advantage
  • improved brand recognition, increasing value of the brand
  • attract best motivated and efficient employees -> people prefer to work for and associate with socially aware businesses
  • goodwill of stakeholders -> better relationships with them
  • decrease in bad publicity and pressure group activity
    OVERALL increase long-term profitability
38
Q

Disadvantages of CSR

A
  • short-run costs could increase -> fitting antipollution equipment, paying workers above poverty levels, not exploiting vulnerable groups when advertising
  • shareholders may be reluctant to accept lower short-run profits
  • loss of cost and price competition -> rival may not do CSR and could have lower costs
  • during economic recession customers may prefer lower prices and not care about how products are made
  • backlash -> may claim socially responsible but found to be doing the opposite.
39
Q

Advantages of mission statements

A

direction
evaluate
motivation
understood by stakeholders

40
Q

Disadvantages of mission statements

A

cost expensive to develop
not supported by all
time consuming to develop

IB Business Management (7 decks)

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