Unit 3.7 Mission, corporate objectives and strategy

Question 1

Mission

Answer 1

the overall purpose of the business. Influenced by what the owners want the business to achieve, personal
values, beliefs and what market opportunities there are

Question 2

Mission statement-

Answer 2

a qualitative statement to key stakeholders, outlining what the business is intending to do

Question 3

Internal factors (mission and objectives):

Answer 3

Business ownership- the form of the business and whether its for
– profit or non –profit has a big effect on objective. Sole traders
have full control, LTD’s – directors and shareholders to answer to
§ Short termism- shareholders can demand a quick return on their
investment, short term objectives to increase profit that don’t
necessarily benefit the business in the long term
§ Attitude to profit
§ Internal environment- size, culture, and resources- views and
leader of managaement
§ Ethical position/ environmental issues – influence objectives to
minimise pollution
§ Organisational culture- structure, flat or tall, decision making
§ Leadership- strength of influence of leadership in the business
§ Strategic position and resources- what options and choices does
the business realistically have based on its existing market
position and resources
§ Stakeholder influence- power and interest

Question 4

External factors(mission and objectives):

Answer 4

PESTLE
§ State of the economy- boom (profits),
recession (survival)
§ Competition
§ Technological changes
§ Global prices
§ Ethical position
§ Environmental issues – influence objectives
to minimise pollution
§ Substitutes

Question 5

A Good Mission Statement:

Answer 5

§ Clear, sense of business purpose
§ Excites, inspires, motivates, guides
§ Differentiates business from competitors

Question 6

Criticisms of mission statements:

Answer 6

§ Not always supported by actions of the business
§ Often too vague and general
§ Often merely statements of the obvious
§ Are they just PR?
§ Sometimes regarded cynically by staff
§ Everyone needs to buy in to be effective

Question 7

SWOT Analysis Advantages:

Answer 7

§ Logical structure
§ Focuses on strategically issues
§ Encourages analysis of external environment
§ Can be redone to take into account changing conditions- can adapt its strategy using the new SWOT analysis
§ Let’s the business know where it has a competitive advantage over it’s rivals- can change its strategy to focus on these
elements

Question 8

Disadvantages SWOT Analysis:

Answer 8

§ Too often lacks focus
§ Poor implementation
§ Fast environmental change
§ Not a guarantee of success
§ Can be subject bias
§ Can quickly become out of date