Business objectives
- Created by: Amber-Jade
- Created on: 07-11-13 18:01
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- Objectives
- What is it?
- Target you are aiming to achieve
- You can measure success with it
- Realistic and achievable
- Provides a focus
- Helps with decision making
- What matters and priority
- Helps with facing potential investors
- They can see where the business is going
- Provides a clear framework for everyone: they can see what role they play and how their contribution will help
- Motivation
- SMART
- SPECIFIC: not generalised (e.g. males over 50)
- MEASURABLE: ability to make a judgement on progress(e.g. by 10%)
- ACHIEVABLE: if staff can't see it happening, they won't try
- REALISTIC: should the business even be trying to achieve this?
- TIME-BOUND: it needs to have a set time-frame to measure success
- Types
- Dependant on business's experience and establishment
- New businesses more likely to be focused on survival/early growth
- SURVIVAL: modest short-term financial objectives, high risk of failure: not well-established, not sure about market response
- ESTABLISHMENT: needs a customer base to get return business, this often happens before launch, good reputation will spread through word of mouth
- CUSTOMER SATISFACTION: expanding customer base will only happen if there is the quality that customers expect, loyalty is important
- MARKET SHARE: when there is a limited overall growth in market (e.g. population) businesses have to compete for a share (e.g. supermarkets), some companies have a natural churn as they will be loosing/gaining customers to/from other companies
- SOCIAL RESPONSIB-ILITY: customers are more comfortable using companies that use some key ethical principles
- New businesses more likely to be focused on survival/early growth
- Need to reflect the business's markets
- Dependant on business's experience and establishment
- Judging business success
- Varies from person to person
- Objectives could be used as measuring and diagnostic tools
- Most businesses use the variance analysis system
- Objectives could be used as measuring and diagnostic tools
- Monitoring performance against financial objectives
- Valuable early warning system
- Set milestones (expected achievements at certain points in the year-e.g. monthly or quarterly)
- Balanced scorecard system
- Lists success measures and monitors success against these
- Financial
- Internal organisational processes (efficiency, etc)
- Learning and Innovation
- Customer focused
- Lists success measures and monitors success against these
- What is it?
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