1.

3 BUSINESS OBJECTIVES

“To accomplish great things, we must not only act, but also dream, not
only plan, but also believe.”
- Anatole France (1844-1924), Nobel Prize Winner for Literature, 1921
LEARNING GOALS

• Explain the definitions and roles of vision statements and mission statements.
• Examine common business objectives, including growth, profit, protecting
shareholder value and ethical objectives.
• Explain strategic and tactical objectives.
• Describe CSR
VISION AND MISSION STATEMENTS
• A vision statement is inspiring or aspirational declaration of what an organization
ultimately strives to be, or wants to achieve, in the distant future. This usually
includes, or at least indicates, the organization’s core values. The vision statement
is intended to act as a clear guide for key stakeholders when planning and
implementing current and future corporate strategies.

• A mission statement is a succinct and motivating declaration of an organization’s

core purpose (why it exists), identity (who they are) and focus (what they do). It is,
therefore, a written declaration that normally remains unchanged over time.
EXAMPLES OF VISSION AND MISSION

• To be earth’s most customer centric company; to build a place where people can
come to find and discover anything they might want to buy online - Amazon
• To stay connected with friends and family, to discover what's going on in the world,
and to share and express what matters to them - Facebook
• To create a better everyday life for the many people - IKEA
• Capture and share the world’s moments - Instagram
• Create economic opportunity for every member of the global workforce - LinkedIn
• To inspire and nurture the human spirit - one person, one cup and one
neighbourhood at a time - Starbucks
ATL ACTIVITY – RESEARCH SKILLS

• Comment on the usefulness of the statement from the perspective of various

stakeholders, such as employees, customers, managers, shareholders, suppliers,
the government, and the local community.
• Investigate the extent to which the organization is achieving its aims and/or
organizational objectives.
• How do the key concepts (creativity, ethics, sustainability, and change) fit into the
organization's mission statements and/or vision statement.
COMMON BUSINESS OBJECTIVES
COMMON BUSINESS OBJECTIVES

• Business objectives (or simply objectives) are the clearly defined and

measurable targets of an organization, used to to achieve its overall goals. The
business objectives have to be SMART:
• Specific
• Measurable
• Achievable
• Relevant
• Time specific
EXAMPLE OF SMART OBJECTIVES

• TNT’s top-level objective is ‘to achieve profitable growth.’ Examples of SMART objectives

across the business that contribute to this include:
• ‘Answer 85% of calls from customers within ten seconds’.
• ‘To improve TNT’s carbon efficiency by45% by 2020 (measured against the 2007 baseline)’.
TACTICAL AND STRATEGIC OBJECTIVES

• Objectives can be long-term (strategic objectives) or short-term (tactical objectives).

1. Strategic objectives are targets that the whole organization is striving to achieve.
It require a greater investment in human and financial resources than tactical and
operational objectives. It is often related to what the owners of the business want to
focus on, such as business survival, growth, or profit maximization.

2. Tactical objectives are easier to change or reverse than strategic objectives. They

are specific targets with definitive timelines.

3. Operational objectives: are the day-to-day objectives set by floor managers.

EXAMPLE

Strategic objective:
to have the highest
market share of car
Tactical objective: to dealerships in the city.
hire and retain
enough salespeople
Operational so that the dealership
objective: To have has sufficient
average amount of salespeople to serve
time that a customer customers at all times.
waits to be greeted by
salesperson to be less
than two minutes
T.O.K QUESTION - FORUM
WHAT OBJECTIVE THEY HAD TO CHANGE TO FACE THE
COVID19?
CHANGE – OBJECTIVES
• It is common for an organization to change its business objectives over time due to
changes in the internal and/or external business environment. The internal
environment refers to situations and settings within the business itself. Hence, the
organization will have some degree of control over these matters. The external
environment refers to situations and factors that are those beyond the control of a
business.
CHANGES IN THE INTERNAL ENVIRONMENT

Changes in the internal environment might include:

• Leadership
• HR
• Organization
• Product
• Finance
• Operations
CHANGES IN THE EXTERNAL ENVIRONMENT

• Social factors
• Technological factors
• Economic factors
• Environmental factors
• Political factors
• Legal factors, and
• Ethical factors.
 Business has limited or
no control over external
environment. This are
the STEEPLE factors:

Ecological Social

Legal Technological

Political Economic

Ethical
PAGE 42. BOOK – READ BIO - BEAN
ATL ACTIVITY. WHERE DID ALL GO WRONG?
INVESTOPEDIA ANALYSIS

• Working with a classmate look at your Investopedia results lately.

Choose two publicly held companies and research its share price over
the last few months.
• Can you explain why the price may have increased or decreased by
looking at news, stories about the company over this period? Use the
internal or external context to answer.
• Prepare a document + 1 slide.
INVESTOPEDIA ANALYSIS – 1 DOCUMENT + 1 SLIDE
EXAM PRACTICE QUESTION UNIT 1.3
CORPORATE SOCIAL RESPONSIBILITY
ETHICS – CSR
• "I would give the car keys to my old friend, and let him take the lady to the hospital.
Then I would stay behind and wait for the bus with the woman of my dreams."
CORPORATE SOCIAL RESPONSIBILITY

• Corporate social responsibility (CSR) refers to the value, decisions and actions

that impact society in a positive way. It is about an organization’s moral obligations
to its stakeholders, the community, society as a whole and the environment. It is
about an organization using ethical objectives to commit to behaving in a socially
responsible way towards its internal and external stakeholders, not just to the
owners or shareholders.
ATL ACTIVITY – THINKING SKILLS Events of the
Deepwater Horizon rig
in the Gulf of Mexico.
BP’s attempt to cut
back on safety checks
ultimately resulted in
the world’s largest
accidental marine oil
spill, costing BP billions
of dollars.
Consider the
importance of CSR as
you watch the
disaster unfold.
CORPORATE SOCIAL RESPONSIBILITY

• A key purpose is to create a positive impact on the reputation of the organization.

It is about building desirable products, practices and relationships that generate this
positive impact.
• Opinions change over time - what may have been considered socially acceptable in
the past may no longer be the case, e.g. animal testing, the use of plastic carrier
bags, sexist adverts, advertising of tobacco products, or targeting children in
television advertisements. Also see ATL Activity 4 below.
• Societal expectations and the growing popularity of social media have caused CSR
to become more integrated into today’s corporate cultures with businesses playing
a greater role in community relations.
• Increasingly, businesses are interested in CSR as a genuine way to have a positive
impact on their triple bottom line: ecological, social and economic sustainability.
CSR – INVESTIGATION SKILLS

• Investigate how the nature of Corporate Social Responsibility (CSR) for an

organization of your choice differs in two different countries in which it operates.
Consider the differences in what might be socially acceptable in one country but not
necessarily in others. Consider the question below as a framework for completing
this task:
• "Corporate social responsibility matters." Based on your research, to what
extent do you agree with this view?
SWOT ANALYSIS
SWOT

• In the pursuit of achieving their aims and objectives, businesses face challenges
from both within and outside of their organizations. Internal and external
opportunities and threats will affect a firm’s performance and chances of success.
Understanding these factors can facilitate effective decision-making. Internal
threats are constraints within a firm’s own control. 
SWOT ANALYSIS
• Firms have some degree of control over the internal factors, but not over the
external factors:
• Strengths – The things that the organization does well or better in comparison to its
competitors, e.g. brand recognition, reputation, market share, cost leadership, profitability,
quality, staff retention, well-trained staff, and customer loyalty.
• Weaknesses – The things that the organization does not do so well in relation to its
competitors, e.g. low productivity, high staff turnover, outdated technology, liquidity problems,
high fixed costs, poor employer-employee relations, skills gap in the organization,
overreliance on a product or particular market, or a poor corporate image.
• Opportunities – External factors that provide openings (prospects) for an organization to
succeed, e.g. new technologies, favourable demographic trends, economic recovery, and
new prospects in overseas markets.
• Threats – External factors that hold back the business, preventing it achieving its
organizational goals, e.g. detrimental weather conditions / seasonality factors, changing
habits and tastes, increased competition in the industry, price wars, oil crises, natural
disasters, the outbreak of infectious diseases, political constraints, environmental laws,
greater regulation of the industry, media exposure, and economic recession.
SWOT ANALYSIS AND MARKET POSITION

The real value of conducting any situational analysis, such as SWOT analysis, is to
inform managers and decision-makers about what needs to be done:
• Strengths - maintain, build, and leverage the strengths of the business or
organization
• Weaknesses - tackle and remedy any weaknesses, with the intention of turning
these into areas of strength
• Opportunities - prioritise and optimise opportunities in order to gain and maintain
competitive advantages
• Threats - counter these in order to minimize risks and to turn these into
opportunities.
SWOT ANALYSIS AND MARKET POSITION

STRENGTHS WEAKNESSES

OPPORTUNITIES GROWTH RE- ORIENTATION

STRATEGIES STRATEGIES

THREATS DEFUSING DEFENSIVE

STRATEGIES STRATEGIES
ANSOFF MATRIX
MARKET PENETRATION
• This growth strategy focuses on developing existing markets with existing products
in order to increase sales revenue and market share.
• If focuses on using strategies to increase the usage rate of existing customers.
• It is a relatively low-risk strategy as it focuses on what the organization does and
knows well.
• There is little, if any, need for investment expenditure or further market research as
the strategy focuses on marketing its existing products to its existing customers.
• It is used to gain market dominance in growing markets and to reduce competition
in mature markets.
MARKET DEVELOPMENT
• This growth strategy involves selling existing products in new or unexplored
markets.
• It focuses on using customer loyalty to persuade them (and prospective
customers) to buy a new product.
• It also relies on a greater distribution network, such as retailers, to get the product
to customers spread around the world.
• This strategy carries an element of risk as the organization might not succeed in
unexplored markets. After all, consumer habits and tastes vary in different part of
the world.
• It can also be expensive for a business to invest and establish itself in new
markets, especially if these are in overseas locations.
TARGET FAILS IN MARKET DEVELOPMENT
NESTLE MARKET DEVELOPMENT IN INDIA
PRODUCT DEVELOPMENT STRATEGY

• This growth strategy involves introducing new products to existing customers.

• If focuses on product differentiation in order to remain competitive or to improve
its competitiveness.
• Typically, products are developed to replace their existing ones (e.g. iPhone
14) or to extend the product range (e.g. iTunes, iPads, and Apple Watch) and
marketed at current customers.
• It is a medium-risk growth strategy because product development can incur
substantial investment costs, such as the expenditure on market research (to find
out what customers want), prototyping and test marketing.
LEGO
DIVERSIFICATION

• Diversification involves organizations moving into new markets with new

products.
• Diversification is a high-risk growth strategy as the organization enters a market
that it has no experience or expertise in. Existing rivals may already have
established themselves with brand recognition and customer loyalty.
• There are two types of diversification:
• Related diversification – the organizations operate within the same industry, e.g., Coca-Cola
entering the energy drinks market.
• Unrelated diversification – involves the organization entering new industries, e.g.,
McDonald’s entering the hotel industry or offering wedding reception services.
RELATIONSHIP

• Unit 1.3 - Examine how Ansoff’s matrix can aid decision making about
organizational objectives.
• Unit 1.3 - Examine the advantages and disadvantages of using a SWOT analysis in
setting business objectives.
ATL ACTIVITY – THINKING SKILLS

• Choose a specific organization of your choice.

• Investigate about the different strategies that they have developed until now.
• Build up a diversification strategy for that company.