Aims and Objectives of a Business: Ch 2

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5 Terms

1
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types of objectives

  • financial aims

  • non-financial aims

  • social aims

2
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why businesses need objectives

  • gives employees something to work towards (motivation)

  • owners need focus and prevents drifting

  • helps decide directions and strategy (expand into new markets)

  • allows performance to be measured- success judged by achieving objectives

3
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Examples of objectives and goals

  • survival

  • profit

  • sales growth

  • market share

  • financial security

4
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Types of objectives

  • social objectives (improve human/ environmental well-being)

  • personal satisfaction (pride, happiness, or turning a hobby into a business)

  • challenge (motivated by overcoming difficulties, testing skills, growing)

  • independence and control (being “your own boss”, making decisions, self-reliance

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why business objectives change

  • market conditions (new competitors, economic changes)

  • technology (automation, online selling, economies of scale)

  • performance (adjusting goals after good/bad financial years)

  • legislation (environmental, employment, consumer protection laws)

  • internal reasons (changes in leadership, resources, or priorities)