UNIT 5: BUSINESS OBJECTIVES AND STAKEHOLDER OBJECTIVES
BUSINESS OBJECTIVES:
Business objectives are the aims or the targets for making the plan of the business.
The benefits of setting objectives:
+ The workers and managers are given a clear targets to making the plans for business and helping motivate people.
+ Taking decisions and make sure that it will help our objectives
+ Clear and measurable objectives help connect the plans of whole business have the same goal.
+ Business managers can compare how the business has performed with their objectives - to see if they have been successful or not.
=> Setting objectives is very important for all businesses.
The benefits of setting objectives:
+ The workers and managers are given a clear targets to making the plans for business and helping motivate people.
+ Taking decisions and make sure that it will help our objectives
+ Clear and measurable objectives help connect the plans of whole business have the same goal.
+ Business managers can compare how the business has performed with their objectives - to see if they have been successful or not.
=> Setting objectives is very important for all businesses.
PROFIT:
Profit is the total income of a business (sales revenue) less total costs.
WHAT OBJECTIVES DO BUSINESSES SET?
The most common objectives for businesses in the private sector are to achieve:
+ business survival: . the objectives of the business will be more concerned with survival than anything else.
+ profit: . the profit are needed to pay a return or provide finance
. without any profit at all, the owners are likely to close the business
+ returns to shareholders: this can be increased in two ways
. increasing profit
. increasing share price
+ growth of the business: for growth in the size of the business - usually measured by value of sales or output - for a number of reasons:
. making jobs more secure if the business is larger
. increasing the salaries and status of managers as the business expands
. opening up new possibilities and helping to spread the risks of the business by moving into new products and new markets
. obtaining a higher market share from growth in sales
. obtaining cost advantages, it is called economies of scale, from business expansion
+ market share - is the percent in industry such as in telecom, food, services, etc.
- If we increase the market share, the business is given: + good publicity - means 'the most popular'
+ increased influence over suppliers
+ increased influence over customers
+ service to the community - Social enterprise has social objectives as well as an aim to make a profit to reinvest back into the business
- Social enterprises are operated by private individuals and they are in the private sector, but they don't just have profit as an objective
- Objectives of social enterprise: + social: to provide jobs and support for disadvantaged groups in society
+ environmental: to protect the environment
+ financial: to make a profit to invest back into the social enterprise to expand the social work that it performs
+ business survival: . the objectives of the business will be more concerned with survival than anything else.
+ profit: . the profit are needed to pay a return or provide finance
. without any profit at all, the owners are likely to close the business
+ returns to shareholders: this can be increased in two ways
. increasing profit
. increasing share price
+ growth of the business: for growth in the size of the business - usually measured by value of sales or output - for a number of reasons:
. making jobs more secure if the business is larger
. increasing the salaries and status of managers as the business expands
. opening up new possibilities and helping to spread the risks of the business by moving into new products and new markets
. obtaining a higher market share from growth in sales
. obtaining cost advantages, it is called economies of scale, from business expansion
+ market share - is the percent in industry such as in telecom, food, services, etc.
- If we increase the market share, the business is given: + good publicity - means 'the most popular'
+ increased influence over suppliers
+ increased influence over customers
+ service to the community - Social enterprise has social objectives as well as an aim to make a profit to reinvest back into the business
- Social enterprises are operated by private individuals and they are in the private sector, but they don't just have profit as an objective
- Objectives of social enterprise: + social: to provide jobs and support for disadvantaged groups in society
+ environmental: to protect the environment
+ financial: to make a profit to invest back into the social enterprise to expand the social work that it performs
WHY BUSINESS OBJECTIVES COULD CHANGE?
1_ A business set up recently has survived for three years and the now aims to work towards higher profit
2_ A business has achieved higher market share and now has the objective of earning higher returns for shareholders
3_ A profit - making business operates in a country facing a serious economic recession so now has the short - term objective of survival
2_ A business has achieved higher market share and now has the objective of earning higher returns for shareholders
3_ A profit - making business operates in a country facing a serious economic recession so now has the short - term objective of survival
STAKEHOLDER:
Stakeholder is a person or a group that has an investment, share, or interest in business.
The stakeholder groups who are involved in business activity: + owners
+ consumers
+ workers
+ government
+ managers
+ banks
+ the whole communicaty
The stakeholder groups who are involved in business activity: + owners
+ consumers
+ workers
+ government
+ managers
+ banks
+ the whole communicaty