IB Business and
Management
1.3 – Organisational Objectives
Learning Outcomes
• Explain the importance of objectives in managing
an organisation
• Explain the purpose of mission and vision
statements
• Analyse the role of vision and mission statements in
an organisation
• Distinguish between Objectives, strategies and
tactics and discuss how these interrelate
• Evaluate the need for firms to change objectives in
response to changes in the internal and external
environment (HL)
In a nut shell…..
Task…..
• In pairs
• Write your answer to the IB exam question:
• Define the term ‘objective’ [2]
Remember what you need to do in order to gain the full
2 marks in a definition question
What is an objective?
• An objective is a target or goal. This is a desired
result that a person or group of people envisage,
plan and commit to
Personal Objectives
• Objectives are not restricted to businesses, many
individuals set objectives too…..
Examples of types of objectives:
• Weight loss
• Grades
• Saving money
Can you think of any others?
Objectives Should be SMART
What does SMART stand for?
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Specific
Measurable
Agreed
Realistic
Timed
Are these objectives SMART?
• To lose 15kg within 2 weeks
• To save $600 dollars within the
next year
• To achieve at least 4 grade 7’s in
the IB in June
• To get fitter by Christmas
Task – 2 minutes
• Write 2 SMART objectives for yourself
BUSINESS OBJECTIVES
Hierarchy of Objectives…..
Corporate Aims
Strategic Objectives
Tactical/Operational
Objectives
Individual Objectives
Why do the arrows flow in this direction?
Task
• Open the document ‘The Differences between
Strategic and Tactical Objectives’
• Drag and drop the descriptors into the right side of
the table.
Types of Strategic Objectives
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Profits
Liquidity
Revenues
Market Share
Repeat customers
Brand Recognition
Customer Satisfaction
Growth
Shareholder value
Return on Investment
Environmental
Ethical
Task • As you know, tactical objectives are set at
departmental level.
• Write a list of the types of tactical objectives that
might be set by each of the following departments:
– Production/Operations
– Finance
– Human Resources
– Marketing
ACHIEVING OBJECTIVES
Achieving Objectives
Corporate Aims
Strategic Objectives
Tactical/Operational
Objectives
Individual Objectives
Achieved
using
Strategies
Achieved
using
Tactics
Importance of Objectives….
• Why are Objectives so important?
Let’s rewind….. What do businesses need to do before they
can write meaningful objectives……
VISIONS AND MISSIONS
Vision Vs Mission
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Vision
Future based
Answers the question
‘Where is the business
going?’
Focus on the long-run
Is inspirational and
should shape strategic
decision making
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Mission
Based in the present
A declaration of the
core values of the
company
Answers the question
‘Why does the business
exist?’
Communicated to
internal and external
stakeholders
WHOSE VISION????
“Our vision is 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.”
‘Our goal is to build great mobile
products that enable billions of
people worldwide to enjoy more of
what life has to offer. Our challenge
is to achieve this in an increasingly
dynamic and competitive
environment.’
‘To be the worldwide leader in
sharing delicious tastes and
creating joyful memories.’
Who’s mission?
• Our mission is to be the world's
premier consumer products company
focused on convenient foods and
beverages
Who’s mission?
• To organize the world‘s information
and make it universally accessible and
useful.
Who’s mission?
Who’s mission?
• to enable people and businesses
throughout the world to realize
their full potential.
Who’s mission?
• Our mission: to inspire and nurture the
human spirit – one person, one cup
and one neighbourhood at a time.
Who’s mission?
• To bring inspiration and innovation to
every athlete* in the world.
*"If you have a body, you are an
athlete."
Who’s mission?
• To give people the power to share and
make the world more open and
connected.
Task – Lets be creative
• Pick a company from the ones below. Can you write
a mission statement for them?
• Try to be inspirational
Task….
What are the key benefits to a business
of having a vision and mission
statement?
Why are there critics of vision/mission
statements?
Homework Task
• Research and find mission statements
for 3 different businesses.
• Try to find concise and unusual
mission statements
• Next lesson you will read them out and
we will guess which company they
come from
AIMS AND OBJECTIVES
Ethical Objectives
Businesses often have additional moral objectives
which they may develop into an ethical code of
practice. These may refer to impacts on:
• Environment
• Consumers
• Suppliers
• Workforce
Ethics and Profits
High Ethical Standards
Good Consumer Image
Consumer loyalty
High Sales and Profits
Cost Cuts
Staff Motivation
Improved Staff Morale
Draw backs of behaving
ethically
• Compliance Costs
• Reduced Profits
• Stakeholder conflict
Marks and Spencer
A Case Study in Ethics
Corporate Social Responsibility
• Socially Responsible Firms are those that act
morally toward their stakeholders
• This may be due to a desire to be ethical or a fear of
negative publicity
• It can often provide firms with a competitive
advantage
Examples of CSR Activities
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Community work
Practising Fair trade
Supporting Charities
Environmental policies
Investing in employees
From Co-operative Bank Website
Task - McDonalds
• Research using the McDonalds Website
• http://www.aboutmcdonalds.com/mcd/csr.html
• Summarise what CSR activities McDonalds
undertakes
What is Social Auditing?
• Social auditing is a process that enables an organisation
to assess and demonstrate its social, economic, and
environmental benefits and limitations.
• It is a way of measuring the extent to which an
organisation lives up to the shared values and objectives
it has committed itself to.
• Social auditing provides an assessment of the impact of
an organisation's non-financial objectives through
systematically and regularly monitoring its performance
and the views of its stakeholders.
• Social audits are generated by the organisation
themselves and those directly involved. A person or
panel of people external to the organisation undertakes
verification of the social audit's accuracy and objectivity
Arguments against CSR
• Some theorists (Milton Friedman for example) say
that a business’ only responsibility is to maximise
profit
• Is it the government’s job to be socially aware?
• Should a business only be socially responsible as
long as it generates the maximum profit?