What defines an aim is a long term cooperate aim that an organization intends to achieve; it’s the overall purpose. For instance, a business may want to make additional income in comparison to the previous year. In addition to this corporate aim, a business might consider increasing their receipts by putting offers on specific products or advancing their promotion to inform their target audience and raise awareness and interest; this is considered to be the businesses objective.
Objectives are considered to be targets which help support the corporate aim and intend to help the business meet their corporate aim in the long run; they’re the outcomes needed in order to achieve the corporate aim.
Business’ produce aims and objectives for a number of reasons, which may range from survival to growth.
A business objective is a detailed picture of a guide you plan to take in order to achieve a stated, long-term aim. A set of objectives for a smaller, newer business who desires to survive may be to create a regular customer base, gain a small share of a market, etc.
in order to create additional profit/revenue that can be put into the capital to be used for advance the business. However for a bigger, existing organization this may be to provide a better service level in comparison to its competitors, to also gain a bigger market share, etc.
In relation to this, a new business will have only one essential short term strategic corporate aim which is to survive in the market.
Additionally, the business will decide to generate objectives in order to meet its short term essential corporate aim. In addition to survival being the corporate aim, you might consider objectives such as generating profit or generating a positive net cash flow in order to produce receipts in the first few months. In order for this to occur, a business may consider the marketing activities of the business and inquire the marketing department to produce a cash flow graph or a break-even analysis to predict what will occur in the first month so that they’ll be prepared for the months to come and will be capable of preparing for them or even may help solve future problems.
However, for a business that has been existent for an excessive duration and has been trading for an elongated period, they will have a more complicated, specific and varied long term strategic corporate aims and objectives that they’d desire to meet. This may be to develop further in terms of revenue and profit over time or through market share, promotion, etc. More specifically, they may consider corporate aims such as profit maximization, to eliminate competition, to expand and diversify. In relation to profit maximization as a corporate aim; objectives such as employing additional workers who’re willing to work for elongated hours may be taken into consideration.
Whether you’re a new business or a business that has been existent for an excessive period of time, the objectives generated should be S.M.A.R.T objectives. Hence the acronym, your objectives should be specific, meaning that you’re stating exactly what your business is trying to achieve; they should be measureable, meaning that you’re capable of measuring what has been and what needs to be achieved; agreed, so that everyone’s approval has been taken into account and supports the objective; realistic, meaning that you’re taking into consideration the business’ resources, competition, etc.; and time specific, relationally meaning that your business should consider when these objectives should be achieved by.
Additionally, key themes should also be taken into consideration when wanting to produce corporate aims and objectives. In Relation to the key themes, you should make sure that you’re using a well-structured procedure for making good decisions so that there are no situations along the way of meeting your overall corporate aim. Furthermore, a business should understand and determine the criteria for making decisions in uncertain times, the accountability for decisions made facing uncertainty, and the heuristics and biases when making decisions. In addition to this, the business may want to produce a cash flow graph in order to help predict the outcomes of the corporate aims made by the business.
Corporate aims and objectives are considered to be beneficial as they’re helpful when a business is desired to survive, grow and make profit, which are the main aims that a business desires to exceed in. In relation to survival, regardless of the business’ status or dimension, survival will be considered whilst generating corporate aims and objectives because it’s the survival that maintains the business and needs to be taken into account at the early stages of trading, when the trading difficulty advances, and when there’s competitors who’re threats of taking over. Survival also allows the business to grow otherwise they may suffer a result in a loss of competitiveness. Additionally, when trading increases its difficulty, or when a competitor has more superior revenue, a business will consider generating aims and objectives in order to maintain their success.