Chapter 1: Using Objectives and Strategies
- Created by: humbuggirl
- Created on: 09-12-14 20:56
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- Using Objectives and Strategies
- Corporate objectives
- Designed to enable business to meet its mission or aims
- used to co-ordinate business activites
- govern setting of functional objectives
- Functional objectives
- set for each division
- designed to ensure corporate objectives are met
- meant to co-ordinate business activities between departments
- Strategies
- medium to long term plans
- allow business to achieve its objectives
- should not be created until corporate and functional objectives have been set
- SMART objectives
- S- specific
- clearly and easily defined
- M- measureable
- quantifiable
- A-agreed
- managers and subordinates are involved in setting of objectives
- R-realistic
- achievable and not in conflict with other objectives
- T-time bound
- based on explicit timescale
- S- specific
- Relationship between corporate objectives and functional objectives
- Survival
- appropriate levels of stock
- minimum level of sales and sales revenue
- required number of well trained/experienced staff
- Profit Maximisation
- effective marketing in order to increase sales
- improving profit margin by minimising costs
- effective capacity utilisation
- reducing staff absenteeism / turnover
- Growth Maximisation
- increasing market share
- retaining profit in order to finance growth
- increasing capacity by expanding number of sites
- recruiting more staff and improving training
- Diversification
- development of niche markets
- raising additional finance via appropriate sources
- achieving economies of scale
- ensuring effective communication between business funcitons
- Survival
- Corporate objectives
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