1.3 – Organisational Objectives
Aims and objectives establish where the business would like to be in the future, helping to
control their plans, motivate staff and give everyone a sense of direction. Any decision
made within the organisation should be in line with their aims and objectives.
The objectives are influence by various stakeholders, as well as the nature of the business.

Importance of Objectives
 Sense of direction
 Purpose and unity within the organisation
 Foundation for decision-making
 Encourage strategic thinking
 Basis for measuring and controlling performance

Strategic Objectives
Tactical Objectives
Different stakeholder groups will have different objectives to suit their interests. Objectives
can be:
 Corporate, which affect the whole business
 Departmental objectives that are for a certain area of the business
 Individual objectives are used in performance appraisal for employees.

Vision Statements
Visions outline the aspirations of a business, where it wants to be, in the distant future.
They do not have a timeline, and are quite vague, outlining the most ideal scenario for the

Mission Statements
This is a simple declaration that broadly states the underlying purpose of an organisation’s
existence. It should also become their philosophy and values. Missions do not have a time
frame, however they are more specific an achievable.

Vision Mission
Outline what the
business is
Higlight their values
Medium-long term
Outline what they
want to become
No actual targets
Rarely updated
The mission statement outlines how the vision statement can be achieved.
However, some believe that vision and mission statements serve no purpose other than
pleasing the public. They are also time consuming to devise and not always supported by
These are general, long-term goals, and tend to be vague and unquantifiable. They give
general direction to business activity. They state what the organisation wants.
These are short, more specific goals based on the aims of the organisation. They tend to be
more quantifiable. They state what the organisation needs to do to get what they want.
Long-term or strategic objectives are achieved using strategies. Such objectives tend to go
over a few years, and may include profit maximisation, growth, image and reputation, and
market standing. In other words, strategies are actions that facilitate the organisation to
meet its objectives.
 Operational strategies are the day-to-day methods used to improve efficiency of
the organization. They are aimed at trying to reach the tactical objectives.
 Generic strategies affect the business as a whole
 Corporate strategies are aimed at the long-term objectives of the business. They
are used to achieve the strategic objectives.

Short-term or tactical objectives are achieved using tactics. These are specific to a
department or segment of the organisation, and are more concerned with the day-to-day
running of the business. They will only go for about 6-12 months. Examples include survival,
sales and revenue maximisation.

There are several levels of strategy that business can adopt.

Good objectives are specific, measurable, agreed, realistic and time bound. They should be
designed to support the mission statement and should be clearly communicated to
employees. The extent to which a business meets their objectives can be an indicator of
their performance.
In addition, objectives will change over time to suit both internal and external factors that
the business is facing.

Ethical Objectives
Ethics – a set of values and beliefs which influence how individuals, groups and societies
Pressure for a business to behave in an ethical manner can be from external or internal
influences. These pressures will affect many business decisions. Businesses may behave
ethically by:
 Reducing pollution
 Recycling
 Environmentally-friendly disposal methods
 Treating staff well
 Fair trade with less developed countries

Advantages Disadvantages
Fulfilling its responsibility in the
eyes of the community
Don't have an obligation, free
economy means that businesses can
do what they like
Acknowledging part in society and
impact on surrounding community
May hinder from main function:
providing goods and services
Impact on local jobs, competition,
suppliers, employees, etc
May impact on profitability due to
increasing costs
Improved corporate image and
May cause conflict between
Improved recruitment, retention
and motivation

In recent years, the push for ethical practice has changed many business practices,
 Animal testing
 Recycling
 New legislation
 Environmental awareness
Many firms will use ethical practice as a unique selling point. This is a very costly process, so
the business must weigh up the returns of implementing these practices against the costs of
doing so.

Corporate Social Responsibility
CSR is when businesses act morally towards stakeholders, boosting their reputation. This
should only be done if it is in the firm’s best interests, as there are many costs involved.
Free-Market Attitude – this is the attitude towards CSR that such social issues are the
responsibility of governments, not businesses. They instead make profit, pay tax and
provide employment only.
Altruistic Attitude – this is the attitude that businesses should always seek to give back to
society simply out of humanitarianism and unselfishness.
Strategic Attitude – this is the attitude that businesses should be socially responsible if it
will benefit them and will bring profit and growth.
An additional difficulty is that cultural difference lead to different expectations, and thus
what some may see as good practice, others may not find acceptable.

Social Auditing
This is a way that socially responsible objectives are implemented. It is an independent
assessment of how a firm’s actions affect society. This might include:
 Renewable and sustainable resources
 Socially responsible suppliers
 Caring for employees
 Ethical code of conduct
 Commitment to CSR policies
These are done at a cost, and therefore the business should be willing to adopt any advice
given in the report.

Sign up to vote on this title
UsefulNot useful