Business Studies Find your chair: Look at the picture what does this mean to you? Be prepared to answer if called upon: This does not require any verbal or non-verbal communication with anyone else in the class.

Business Studies Chapter 4

Chapter Objectives The nature and significance of business objectives in the private and public sectors. Decision-making and influences on business objectives.

Business Objectives An objective is a target. A good objective will consist of the following: What is to be achieved. How much the business wants it to be. When it should be done by. This means a good objective should be: Specific terms of what the target is. Quantifiable (measurable) Time specific in terms of when it should be completed.

Why are Objective Important? Within each department every individual should also have his or her own objectives. Each manager should have also have their own objectives as well as their employees. The setting of objectives helps the business coordinate its activities. Corporate objectives are objectives that apply to the entire business, such as growth, expansion and overall sales objectives.

Corporate Social Responsibility as a Business Objective A business may have many objectives relating to different areas. Example, it may want to boost profits but at the same time be aware of the impact on society and the environment. All countries have different laws on how a business should conduct itself within their borders. (minimum wage/age) All businesses should have objectives that meet the legal requirements over and above the legal minimums. This behavior is called Corporate Social Responsibility.

Examples of Corporate Social Responsibility Types of corporate social responsibility CSR can encompass a wide variety of tactics, from giving nonprofit organizations a portion of a company's proceeds, to giving away a product or service to a worthy recipient for every sale made. Here are a few of the broad categories of social responsibility that businesses are practicing: Environment: One primary focus of corporate social responsibility is the environment. Businesses, both large and small, have a large carbon footprint. Any steps they can take to reduce those footprints are considered both good for the company and society as a whole. Philanthropy: Businesses also practice social responsibility by donating to national and local charities. Whether it involves giving money or time, businesses have a lot of resources that can benefit charities and local community programs. Ethical labor practices: By treating employees fairly and ethically, companies can also demonstrate their corporate social responsibility. This is especially true of businesses that operate in international locations with labor laws that differ from those in the United States.

Mission Statements, Objectives, Strategy and Tactics. A mission statement sets out the overall purpose of a business. An objective is a target that is measurable and has a given timescale. Strategy is a long-term plan to achieve the objective of the business. Tactics are short-term actions needed to implement the strategy.

Mission Statement A mission sets out the purpose of the business. Example: An airline company may exist to be the “best airline in the world” Mission is determined by the owners of the business.

Objectives Objectives are measurable targets that are given a timescale. What does an airline exactly measure to be the best airline in the world? Number of passengers? Customer satisfaction surveys.

Strategy Long-term plan to reach an objective. Example a company wants to increase profits by 30% in three years.

The Importance of Business Objectives Business objectives set out what the business wants to achieve. This provides a focus for all decisions. Everyone in the business should know what their role is to lead the company to achieve those objectives. Objectives can motivate employees and provide measurable control as progress can be reviewed against the target.

Homework Case Studies: Tesco Growth in Turkey Intel Sets itself Social Objectives Questions #1-4 Page 31 DUE WEDNESDAY JUNE 17TH

Business Studies Find your chair: Look at the qoute what does this mean to you? Be prepared to answer if called upon: It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently. Warren Buffett This does not require any verbal or non-verbal communication with anyone else in the class.

Business Studies 4.2

The Role of Objectives in the Stages of Business Decision-Making Managing a business involves many different decisions. Making right decisions is important.

Decision Making Involves Setting objectives: A success of a plan can only be judged against the objectives that were set. Gathering information: You need information on where you are at the moment, what is happening and your opinion to analyze the situation. Selecting a suitable strategy: Figuring out the best strategy Implementing the strategy: Put your tactics to work Reviewing: Essential to see how you have got on and what if anything needs to change. Can also change targets at this point.

How Objectives Might Change Over Time Internally: A business may have new owners or managers that want to achieve different things. Example more concerned about environmental records. Externally: Perhaps the economy has changed so the business needs to change their targets. Decision-making is a continuous process.

Turning Objectives Into Targets With each objective there should be a strategy of how it is to be achieved and specific tactical targets showing the details of the activities that need to be undertaken. A plan will show: Who is in charge of what What they have to do When it must be done How much do they have to spend A budget is a financial plan.

The Communication of Objectives There needs to be a discussion with people who will be responsible for achieving the objectives. Having objectives can be motivating for employees because it provides a sense of direction. Also could be demotivating if the objectives are unrealistic and if there is no one that believes in them.

How Ethics May Influence Business Objectives Ethical behavior is behavior that is thought to be morally correct, and not necessarily the most profitable. How businesses consider right or wrong in terms of business. Should we produce a produce that is harmful to the environment even though it is much cheaper for us. Good example is plastic bags. Many businesses have stopped using plastic bags and make you purchase reusable bags. Sometimes objectives can encourage unethical behavior. If the objectives are set too high. Sales objectives for example, might encourage the sales team to trick customers or pressure them into buying something they don’t want or need.

Homework Ethics at Texas Instruments Questions #5-10 Due on Friday June 19th