1.3 Oxford textbook
Mission statement
States the business' purpose and why it exists. Specific and tends to not be changed.
Vision statement
Forward looking and speaks to a long term aims and highest aspiration of a business. Tends to be broad and abstract.
Business objectives
clearly defined and measurable targets of an organisation. Essential to know what they are striving to achieve. Give employees a sense of direction.
Strategic objectives
Long-term. Targets the growth that the whole organisation is striving to achieve. Includes business survival, growth and profit maximisation.
Tactical objectives
Short term. Easier to change or reverse. Specific targets with definitive timelines.
Growth
Refers to an increase in the size of a business and its operations.
Economies of scale
Cost saving benefits for firms as they grow larger (buy bulk)
Internal growth
Organic growth. Organisation expands without the help of an external partner firm. Uses its own resources such as retained profits to invest in the production facilities.
External growth
Inorganic growth. Expansion and evolution of a business by using a third party resources.
Sales revenue
monetary value of the products that the business has sold
Sales volume
Number of the products that the business has sold.
Market share
firm's sales revenue as a proportion of the whole industry's sales revenue.
Profits
Financial surplus. Difference between a firm's sales revenues and its total cost of productions. Provides internal soruces of finance.
Protecting shareholder value
Company is owned by its shareholders. The responsibility of the company's CEO and board of directors, based on their strategic plans to earn a healthy return on the capital invested.
Stability
to continue to operate at an optimum level, management must have certain objectives
Ethical objective
Ethics is the academic discipline or study or moral philosophy. Business ethics are the guiding principles that provide moral guidelines for the conduct of business activities.
CSR (corporate social responsibility)
Establishes the business organisation as a part of society and must actively reduce the negative impacts on society and maximise positive impacts.