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Organizational Objectives
Objectives
Objectives
The Importance of
Objectives
Why are objectives important?
Organizational Objectives
Key Functions
1. To control
Sets boundaries for business activity
2. To motivate
Inspire all to reach a common goal
3. To direct
Provide a sense of direction
Vision
A philosophy, vision or set of principles
Vision Statement
Speaks to the long-term aims and highest
Mission
To have a clear purpose
What is the business trying to achieve and
Mission Statement
A simple declaration that broadly states the
Differences
Time frame Vision is longer
Measurability Mission is more achievable
Specific Vision is less specific and more
vague
Real-Life Application
UA Schools
Other Companies
Aims
Long-term goals of an organization
Broad, vague, and unquantifiable
General direction of an organization and often
Objectives
Medium- to short-term and more specific goals
of an organization
Clarify how the business will achieve its aims
and reach its vision
Measurable (Quantifiable)
Objectives
Unquantifiable
Quantifiable
Vague
Specific
Objectives
Hierarchy of Objectives
Aims
CEO/Owner
Strategic
Objectives
Executives/Directors
Tactical Objectives
Operational Objectives
Middle Managers
Floor
Managers
Table 1.3.3
Page 40
More Terms.
Business Strategy
A plan to achieve a strategic objective in order to work
Business Tactic
A plan to achieve a tactical objective to work towards the
Change in Leadership
HR
Business Organization
Product Change
Finance
Operations and
Innovation
EXTERNAL ENVIRONMENT
Social
Technological
Economic
Ethical
Political
Legal
Ecological /
Environmental
Ethical Objectives
Ethical Objectives
Goals based on established codes of
Financial Dishonesty
Environmental Neglect
Exploitation of the Workforce
Exploitation of Suppliers
Exploitation of Consumers
Is this socially
irresponsible?
Advantages and
Limitations of Ethical
Behavior
Brainstorm a list of
advantages and limitations of
ethical behavior for a business
Advantages
Improved image
Increased customer loyalty
Developing a positive work environment
Improved staff motivation / less turnover
Improved staff morale
Recruitment
Cost cutting
Reducing risk of legal implications
Satisfying customers expectations
Profitability
Limitations
Compliance costs
the potentially high costs of acting ethically
Lower profits
Stakeholder conflict
Resistance to change
Objectives
Strengths
Weaknesses
Opportunities
SWOT
Threats
An analytical tool
Existing
Existing
New
Market
Penetration
Product
Development
Lowest Risk
New
Market
Development
Medium Risk
Medium Risk
Diversification
Highest Risk
Market Penetration
Market Penetration
Advantages
Focus on markets
and products that
are familiar
Safest of 4
strategies in the
Ansoff matrix
Limitations
Strong reaction
from competitors
Price wars
Is the market
saturated? What
is the growth
potential?
Product Development
Important factors:
Market Research, R&D, First mover
advantage
Product Development
Product Development
Advantages
Prolonged life
Meeting needs of
a changing
market
Not starting from
scratch
Potential first
mover advantage
Disadvantages
Money/Costs
Research and
Development
Might not be
successful
Market Development
How to do this:
locations or overseas
Market to new audience
Additional Marketing Strategies from Unit 4
Market Development
Advantages
Reduced risk
because the
business is
familiar with
product
Larger potential
customer base
Potential first
mover advantage
Disadvantages
Success in one
market does not
necessarily mean
success in another
Advertising/promo
tion costs
R& D and Market
Research is
expensive
Diversification
Key Factors:
Effective market research
Testing the market
Forecasting costs
Diversification
Ways to Diversify
Acquisitions
Brands or Complete Takeovers
Examples of Diversified
Companies
Disney (Pixar, ESPN, Theme Parks,
Diversification
Advantages
Increased market
share in
established
markets
Spread risks
New opportunities
for growth,
especially in
saturated markets
Disadvantages
Riskiest growth
strategy of all 4
because new
products and new
markets
Time consuming
and costly
Can cause
distraction
Loss of focus
Review 1.3