Business Objectives and Strategies Ch 4

Corporate Aims
 Aims are the long term intentions that provide a focus for setting objectives.
Mission statement
 It is a document detailing the aims that should provide the sense of common purpose to direct
and stimulate the organization.
Objectives
 Objectives are the short term, medium term and long term targets that can give a sense of
direction to a manager, department or whole organization. Objectives should be clear; it means
that they should be measurable and have an explicit timescale.
 Breakup of Objectives
 Corporate objectives: Overall objectives of the organizations.
 Departmental objectives: Overall objectives are broken down into department, factory or
other subdivision of organization.
 Individual objectives/targets: Departmental objectives are broken down & given to
individuals as targets.
 Importance of this Breakup
 Everyone should know what he has to do and which role he is playing for
business success.
 Decision making – consistency
 Analysis
 Common Corporate Objectives
 Maximum profit.
 Growth
 Increasing market share
 Sales increasing
 Increasing share values
 Social, ethical and environmental objectives
Factors which Determine the Objectives
 Culture (see corporate culture)
 Size and legal form of business
 Age of business
 Public or private sector organization
Corporate Culture
 Culture of an organization is the (perhaps unwritten) code that affects the
attitudes, decision making and management style of its staff.
Types of culture
Task culture – where task is more important than people. (McGregor’s Theory X)
 People culture – people oriented, with grater concern for the people doing the job and the
extent of their involvement in work. (McGregor’s Theory Y)
Strategy
 The long term planning of a business designed to achieve its objectives. These
plans must be frequently reviewed and updated so that it can be modified as required due to
changes in the market.
 Factors that Influence on Strategy Formation
 Strengths, Weakness of business
 Available resources
 Competitive environment
 Objectives

Stakeholders
 A stakeholder is an individual or group who has direct or indirect interest in
organization performance. Those who affects directly or indirectly due to organizational activity
are also stakeholders.
List of stakeholders with their main objectives is on page 58 table 4.1
Conflict of stake holder’s objectives
SWOT analysis
 This is the assessment of a product, division or an organization
in terms of its strengths, weaknesses, opportunities and threats.