3.1.1 corporate objective

• Diversification is when the business expands into unrelated markets to reduce risk
• Aim

  • What the business is looking to achieve in the long term?
  • Often expressed as an overall vision and describes the businesses reason for being
• Mission Statement

  • An expression of a business's overall aim as well as its core values and context
  • Informs the development of corporate and functional objectives
  • Often expressed in inspirational terms to provide direction and a common purpose for employees
• Corporate Objectives

  • The specific performance goals set by senior management for the business to achieve over time
  • Derived from the firm’s overall aim and mission statement
  • Corporate objectives may focus on achieving specified levels of market share , profit, sales growth or new product/market development
• Functional Objective

  • The day to day goals of functions or departments within the business, derived from corporate objectives
  • Functional objectives must be carefully aligned across departments so that all parts of the business are working towards the shared goal
• SMART objectives

  • Specific
  • Measurable
  • Agreed
  • Realistic
  • Time - bound
• Businesses need to critically assess whether corporate aims and mission statements continue to reflect the current corporate vision
• The content and expression of business aims will likely change over time to reflect changing social attitudes and norms
• Mission statements - criticised as being little more than exercise in public relations that do little to inform objective-setting or promote a common organisational goal.
• Things to consider when changing aims & objectives

  • The short- to medium-term strategies adopted by business support the aim and mission.
  • The aim and objectives are realistic and achievable in current trading environment.
  • The mission statement message communicates effectively the aim of the business with stakeholders.
• What does changing objectives offer a business?

  • Chance to involve variety of stakeholders including workers and suppliers in determining direction of business.
  • Newly-identified opportunities and threats can be acknowledged.
  • Sharing refreshed priorities, particularly with the media can generate positive publicity.