1

Business Environment
CA-IPCC

www.coursemateonline.com
Following is a sample excerpt from STRATEGIC MANAGEMENT - By CA K S Jolly
For Downloading Complete Notes and Video Lectures
Log on : www.coursemateonline.com
Call : +91 99887 12345

VIDEO LECTURE: www.youtube.com/watch?v=lMksfiUrmfM
TOPIC:
2.2 Objectives of a Business
Business objectives are something which a business organization wants to achieve or accomplish over a
specified period of time.
These may be to earn profit for its growth and development, to provide quality goods to its customers, to
protect the environment etc.
Profit making is generally believed to be the basic objective of a business. But it cannot be the only objective
of business.
While pursuing the objective of earning profit, business units do keep the interest of their owners in view.
However, any business unit cannot ignore the interests of its employees, customers, the community, as
well as the interests of society as a whole.

Thus, the objectives of business may be classified as:
a. Economic Objectives
b. Social Objectives
c. Human Objectives
d. National Objectives
e. Global Objectives

a. Economic Objective
Profit Making - Profit making is the primary objective for which a business unit is brought into existence.
Profits must be earned to ensure the survival of business, its growth and expansion over time. It is treated
as a financial yardstick or overall measure of performance for measuring business efficiency and for
evaluating managerial competence how well the decisions and actions of managers turn out to be
effective.
In order to achieve this primary objective, certain other objectives are also necessary to be pursued by
business, which are as follows:
a) Creation of customers - A business unit cannot survive unless there are customers to buy the products
and services. A business can earn profits only when it provides quality goods and services at a reasonable
price.
b) Regular innovations - Innovation means changes, which bring about improvement in products, process
of production and distribution of goods. Business units, through innovation, are able to reduce cost by
adopting better methods of production and also increase their sales by attracting more customers because
of improved products
c) Best possible use of resources - Business activities require various resources like men, materials, money
and machines. The availability of these resources is usually limited. Thus, every business should try to make
the best possible use of these resources-i.e. Business Efficiency.




1
Business Environment
CA-IPCC

www.coursemateonline.com
b. Social Objectives
1 Adoption of fair trade practices.
2 Contribution to the general welfare and upliftment of the society
3 Protecting the environment
c. Human Objectives
1 Economic well-being of the employees
2 Social and psychological satisfaction of employees
3 Development of human resources
4 Wellbeing of socially and economically backward people
d. National Objectives
1 Creation of employment
2 Promotion of social justice
3 Production according to national priority
4 Contribution to the revenue of the country
5 Self-sufficiency and Export promotion
e. Global Objectives
1 Reduce disparities among nations
2 Make available globally competitive goods and services





1
Business Environment
CA-IPCC

www.coursemateonline.com



+91 99887 12345