1.3

• Vision statement

  An image of an ideal situation in the future
• Vision statement characteristics


  • Outlines an organisation's aspirations in the distant future
  • An inspiring or aspirational declaration of what an organization ultimately struves to be, or want to achieve, in the distant future
  • Includes the organization's core values
  • Intended to act as a clear guide for key stakeholders when planning and implementing current and future corporate strategies
• Mission statement


  A simple declaration of the underlying purpose of an organisation's existence and its core values
• Purpose and characteristics of mission statements


  • Define the organisation i.e. what it is
  • Outline what the organisation aspires to be (in line with its vision statement)
  • Emphasise the organisation's core values
  • Broad enough to allow for growth and evolution in a creative and sustainable way
  • Distinguish the organisation from others in the market
  • Serve to evaluate current business activities
  • Phrased clearly so that it is understood by all stakeholders
• Limitations and criticism of vision and mission statements
• Objectives

  Goals and targets an organisation strives to achieve, they're specific and quantifiable measurable, set in line with the organisation's mission statement
• Importance of objectives


  • To measure and control - help to control firms plans determining the parameters for business activity, = objectives provide the basis for measuring and controlling the performance of a business as a whole
  • To motivate - help to inspire managers and employees to reach a common goal, unifying and motivating the workforce. It encourages managers to think strategically, and planning for long term success for a business
  • To direct - provide an agreed and clear focus of all individuals and departments of an organisation. As the foundation for decision-making, organisational objectives are used to devise appropriate business strategies.
• Growth


  The growth of a business is usually measured by an increase in its sales revenues by its market share (the firm's sales revenue expressed as a percentage of the industry total sales revenue)
• Profit/surplus


  The main objective of most private sector organisations is to maximise profits, which provides an incentive for entrepreneurs to take risks in setting up and running their businesses. For incorporated businesses a portion of profits (dividends) is distributed to their shareholders.
• Protecting shareholder value


  Safeguarding the interests of the owners of a limited liability company (one owned by shareholders either as a private or publicly traded company) - as they are looking for a return on their investment. Protecting shareholder value is ultimately the responsibility of the company chief executive officers (CEO) and board of directions.
• Ethical objectives


  Organisational goals based on moral guidelines in order to influence or determine business decision making, they consider more than just calculating costs, benefits and profits. Means such businesses act morally towards their various stakeholder groups, i.e. employees managers, customers, shareholders, suppliers, financiers, local community (including consideration for the natural environment), the government and even competitors.
• Examples of unethical business behaviour


  • Financial dishonesty
  • Environmental neglect and damage
  • Exploitation of workers
  • Exploitation of suppliers
  • Exploitation of consumers
• Code of conduct


  The documented beliefs and philosophies of the business, it is important because people need to know what is considered acceptable and not acceptable with an organisation such as guidelines and expectations on employee behaviour.
• Advantages of ethical objectives

  • Improved corporate image
  • Increased customer loyalty
  • Cost cutting
  • Improved staff morale and motivation
• To achieve their ethical objectives, an increasing number of businesses have adopted an ethical code of practice and published their annual reports.
• Code of ethics

  Having personal integrity and consideration for others can provide a framework for consistency and uniformity in the workplace
• Example of increased customer loyalty


  • Body Shop established a large customer base worldwide as their ethical policy states they do not test products on animals
• Integrity


  How honest are you
• Sympathy


  How you feel, if anything about the teacher losing her wallet
• Empathy


  If you have experienced losing your own valuables, you will have a better understanding of the feelings of your teacher
• Loyalty


  The teacher could be your favourite teacher or someone you really respect
• Conscience


  Whether the student has any concerns or feelings of guilt
• Justice


  You might think the teacher is rather careless and should learn the hard way
• Strategy


  Medium to long term plans of action to achieve strategic objectives
• Tactics


  Short-term methods used to achieve tactical objectives
• Tactical objectives


  Short term goals that affect a section of the organisation, specific goals that guide daily functioning of certain departments or operations
• Survival


  Key tactical objective for new and unestablished businesses
• Sales revenue maximisation


  New businesses strive to maximise their sales revenue to establish themselves in the marketplace
• Strategic objectives


  Longer-term goals such as profit maximisation and growth
• Market standing


  Business has presence in the industry
• Image reputation


  Businesses strive to enhance their image and reputation
• Market share


  Strive to increase their market share over time
• Corporate Social Responsibility (CSR)


  The conscientious consideration of ethical and environmental practice related to business activity
• The nature of CSR is subjective, what is considered 'right' or 'wrong' and is based on public opinion, meaning the attitudes may change over time
• A formal documented policy setting the way the business believes it would behave, including how to respond to situations that challenge integrity or social responsibility or accusations/citation of unethical business practices
• Examples of CSR


  • Providing accurate information and labelling
  • Adhering to fair employment practices
  • Having consideration for the environment
  • Active community engagement
• • Dependent on interrelated factors: The involvement, influence and power of different stakeholder groups, such as pressure groups and the government
  • The corporate culture and the firm's attitude towards CSR and ethical objectives
  • Societal expectations, ie the general public awareness and concerns for CSR issues
  • Exposure and pressure from the mass media
  • Experience - quite often it takes a crisis or bad experience to precipitate attention to CSR
  • Compliance cost, ie. the human and financial resources and costs needed to implement CSR policies
  • Laws and regulations ie legislation that govern how firms conduct themselves in a socially responsible way
• Internal factors that can cause a change in business objectives

  Corporate culture<|>Type and size of organisations<|>Private versus public sector organisations<|>Age of business<|>Finance<|>Risk profile<|>Crisis management
• External factors that can change the objectives of a business


  Factors beyond the control of the organisation