IB Business Management 1.3

What is a vision statement?

a business's ideal situation in the future

What is a mission statement?

a business's clear purpose

What are business objectives?

the goals or targets an organization strives to achieve

What should each objective include?

Specific

Measurable

Attainable

Relevant

Time-based

Why are business objectives important?

• to measure and control

• to motivate

• to direct

What are common business objectives?

growth, profit, protecting shareholder value, and ethical objectives

What is growth?

usually measured by an increase in its sales revenue or by marker share. failure to do this may result in declining competitiveness and threaten the firm's sustainability

What is profit?

traditionally the main business objective of most private sector businesses

What is protecting shareholder value?

earning a profitable return for shareholders in a sustainable way. challenge is balancing short-term profits with an investment in the long-term value of the company

What are ethical objectives?

the moral (right versus wrong) principles that guide decision-making and strategy

What have businesses adopted to achieve their ethical objectives?

a code of ethics (included in mission statement or annual report)

What are strategic objectives?

longer-term goals of a business, such as profit maximization and growth

What is market standing?

the extent to which a business has presence in the industry

What is image and reputation?

stems from consumer beliefs and perceptions of a firm

What is market share?

measured by expressing the firm's sales revenue as a percentage of the industry's total sales

What are tactical objectives?

short-term goals that affect a section of the organization

What are examples of tactical objectives?

survival and sales revenue maximization

What is corporate social responsibility (CSR)?

the conscientious consideration of ethical and environmental practice related to business activity

What are examples of CSR?

provide accurate product labeling, adhere to fair employment practices, be conscious of impacts to the environment, contribute to communities via volunteer or charitable work