Business Objectives

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Mission Statement
Business Objectives
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E2 Describe and explain the objectives of the
BusinessC1 Make judgements about how
successfully the Business is meeting its
objectives

• Mission Statement
• A Statement in a few sentences of the overriding
  purpose of the business
• Represents the mission or vision of the business
• Best mission statements are plain speech with no
  technical jargon

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Some Examples

• Our vision is to be the worlds leading retailer
  of products and services that help our customers
  look good and feel good
• To serve the most vulnerable
• .aims to be the first choice supplier of
  energy and services to homes and businesses in GB
• aims to be the most admired and respected
  service company in the UK
• To be the family restaurant that people enjoy
  more. This will be achieved through five
  strategies Development, Our People, Restaurant
  excellence, Operating Structure, and the Brand

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The Answers

• Boots the Chemists
• The Red Cross
• Centrica
• BMW
• Macdonalds

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Business Objectives

• Medium to long-term targets that provide a sense
  of direction to the business.
• Normally measurable and have a stated time-scale
• Businesses may have a number of objectives
• Objectives of businesses can vary tremendously
• Think of some examples..

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What effects the objectives ?

• Objectives will vary depending on a businesss
  size, ownership and legal structure.
• Small businesses may focus on survival next
  weeks sales figures
• larger businesses may aim to maximise profits or
  sales, or try and increase market share

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Stakeholders

• Some one / group who has an interest in the
  activities of the business
• External
• Customers, Suppliers, Shareholders, Lenders,
  Pressure Groups, Local Community, Government
• Internal
• Owners, Managers, Employees,

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Customers
Lenders
BUSINESS Owners Managers Employees
Suppliers
Pressure Groups
Local Community
Shareholders
Government
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Profit Maximisation

• Often an important objective for companies owned
  by shareholders
• 
  minus

Costs
Revenue
Profit
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Why is Profit so important ?

• To provide high returns for shareholders
• To provide funds to improve products
• To launch new products
• Potential shareholders will be attracted
• What is satisficing ?

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Survival

• An important objective for many businesses
• During periods of recession or intense
  competition
• At times of crisis eg. hostile take-over bid
  like Nat West being taken over by The Royal Bank
  of Scotland

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Increasing sales or market share

• Growth increases the scale of the business
  resulting in higher levels of output and
  increased sales
• Can be an important target for managers
• Increasing market share important if the actual
  market is not increasing
• To exploit economies of scale

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Providing Services to the Community

• NHS, Schools, Colleges, Fire service, Police etc
• Part of the Public Sector
• Overriding objective is to provide the best
  possible service to the community

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Charitable and non-profit objectives

• Eg. Oxfam / Mencap / Save the Children
• To raise awareness of the cause they support
• To raise funds for their projects
• All businesses nowadays need charitable
  objectives and to be seen to be caring for
  society and the environment
• Discussion How real is their care ?

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• Developing a skilled workforce
• Productivity / Motivation / Recruitment / Quality
  Service
• Producing High Quality Products
• To earn and maintain a reputation
• Can allow premium prices to be charged any
  examples ?