1 Aims and Objectives, Mission Statements Geoff Leese Sept 1997 Revised Sept 1998, Sept 2001, Sept 2002, Sept 2003, Sept 2005, Sept 2006, Sept 2007, Aug 2008, Aug 2009, Jan 2010

2 Are they the same? n A hierarchical list of intentions, becoming more specific and measurable as one goes down the hierarchy. Mission Statement Aims Objectives Goals?

3 The Mission Statement n A short statement that sum up the organisation’s approach and purpose. n “Life long learning for the whole community” n “What are we FOR?” ä What business are we in? ä What business do we want to be in? ä How might we get there? n What’s yours? (Levitt, 1960)

4 Strategy n Made up of aims and objectives

5 Aims n Broad, long term goals. n “Where do we want to be?” n Probably best to have no more than have a dozen n States what we want to achieve, not how we’re going to do it.

6 Objectives n Clear, unambiguous, measurable statements n Each aim will usually have several objectives n Statements of WHAT we will do, not how it will be done.

7 Objectives n Clear, unambiguous, measurable statements n Each aim will usually have several objectives n Statements of WHAT we will do, not how it will be done.

8 Examples of strategic objectives n Attaining a predetermined ROCE n Increasing shareholders’ earnings n Becoming the market leader n Reducing borrowing n Improving industrial relations Bennett chapter 2 page 18

9 Examples of tactical objectives n Acquiring a subsidiary in a particular market n Extending product range n Introducing new manufacturing technology n Revising organisational structure Bennett chapter 2 page 18/19

10 Examples of operational objectives n Meeting forecast sales next year n Increasing market share of some products n Cost-cutting programmes n Efficient utilisation of plant, machinery and people n Improving cashflow position n Better credit control Bennett chapter 2 page 19

11 SMART Objectives n Specific – not general n Measurable – objectives without performance measures are pointless! n Agreed – commitment of stakeholders n Realistic – unrealistic objectives lead to disillusionment and cynicism n Time constrained – otherwise they’ll never be achieved!

12 Policies n HOW objectives will be pursued.

13 Examples n Aim - A happy, healthy, contented, productive workforce. n Objective – Improve the health of our workforce by cutting the number of smokers in our workforce by 20% NLT January n Policies ä Introduce a smoking ban in the workplace ä Offer practical help to employees to stop smoking

14 Objectives of Private-Sector organisations n Profit maximisation ä Produce & supply goods & services for which demand is increasing ä Minimise costs of production ä Maintain output at level where profits are maximised ä Vary level of supply (needs market domination!) ä R & D (new products and methods)

15 Objectives of Private-Sector organisations n Brand leadership/market domination n Corporate growth ä Expanding existing markets ä Diversification ä Takeover n Satisficing ä “Just enough is good enough”

16 Objectives of Private-Sector organisations n Survival ä “buying turnover” n Loss-making ä offset against profit making parts of the group ä may still be cheaper than “buying in” n Strictly defined profit levels n Service n Employment

17 Objectives of public-sector organisations n Stakeholders ä The Government ä Public sector workers ä The Public n Wide range of objectives here! n Fashion is for “business objectives” to be increasingly important

18 Objectives of Public Sector Organisations n Access – ä available to all regardless of location or income n Quality – ä high quality services that do not cut corners n Affordability – ä services offered at prices that are cheaper than private sector or free at the point of use n Equity – ä available to anyone whatever their background, status, income, class, race, religion, etc.

19 Problems with objectives n Bias n Complexity n Conflict n Lack of clarity n Communication

20 Influences on Objectives & Policies Owners expectations Objectives and policies Social responsibility Business ethics Consumer pressures Pressure groups Manager’s goals Trade Unions Economic Factors Legislation Employee expectations

21 Reading n Bennett chapter two n Cole G (1996) Management Theory and Practice, DP publications Chapter 17 n Hannagan T(1998), Management Concepts and Practices, FT Pitman Chapter 5 n Glossary of terms – follow the link! Glossary of terms – follow the link! n Writing a Mission Statement – follow the link! Writing a Mission Statement – follow the link!

22 Tutorial Questions n Give three examples of strategic objectives and three of tactical objectives – for BT if you can! n What is a mission statement and what is BT’s? n Levitt offers three fundamental questions when writing objectives. ä What are they and how well do you think BT is addressing them?

23 Tutorial Questions n How are objectives and goals sometimes considered to be different? n What are SMART objectives? n What are the advantages and disadvantages of MBO?