Corporate Objectives (Edexcel A Level Business)

• Aims and objectives serve as a guide for the businesses' overall strategy and direction, helping to focus efforts and resources toward a common purpose
• There is a hierarchy of objectives which cascade downwards
   

The Hierarchy of Objectives

• A businesses mission flows from its overall aim and is usually expressed in inspirational terms
• From this mission corporate objectives and functional objectives which detail the achievable goals a business wants to achieve over a specified period are developed
   

Components of the Hierarchy Explained

Component	Explanation	Example
Aim	What the business is looking to achieve in the long term? Often expressed as an overall vision and describes the businesses reason for being	Macmillan Cancer Support  'To do whatever it takes to support people living with cancer
Mission Statement	An expression of a business's overall aim as well as its core values and context Informs the development of corporate and functional objectives Often expressed in inspirational terms to provide direction and a common purpose for employees	Age UK 'Making a positive difference by putting older people, and the people around them, at the heart of all we do; working with partner organisations, to improve the quality of later life and provide effective, timely support for those who need it the most
Corporate Objective	The specific performance goals set by senior management for the business to achieve over time Derived from the firm’s overall aim and mission statement Corporate objectives may focus on achieving specified levels of market share , profit, sales growth or new product/market development	Mind UK 'Provide 3 million employees in low-paid sectors with workplace wellbeing support'
Functional Objective	The day to day goals of functions or departments within the business, derived from corporate objectives Functional objectives must be carefully aligned across departments so that all parts of the business are working towards the shared goal	Scope UK 'Working with the Government and disabled people we will create a Passenger Charter, an information resource to help disabled people find the information they need when using public transport

SMART Objectives

• Corporate and functional objectives should be
  • Specific
  • Measurable
  • Agreed
  • Realistic
  • Time-bound
     

An example of a SMART sales objective 

• Businesses need to critically assess whether corporate aims and mission statements continue to reflect the current corporate vision
  
  
  • The content and expression of business aims will likely change over time to reflect changing social attitudes and norms
    • For example Apple’s new mission statement - ‘to make the best products on earth, and to leave the world better than we found it’ - emphasises its commitment to sustainability, a key social trend
      
      
  • Mission statements are sometimes criticised as being little more than an exercise in public relations that do little to inform objective-setting or promote a common organisational goal
    • For example in 2013 KFC’s mission was ‘To sell food in a fast, friendly environment that appeals to price conscious, health-minded consumers - in the same year it launched a burger that replaced the bread bun with extra layers of deep-fried chicken
      
      
• Businesses should decide whether changes to the corporate aim or mission statement need to be made by considering whether
  • The short- to medium-term strategies adopted by the business support the aim and mission
  • The aim and objectives are realistic and achievable in the current trading environment
  • The mission statement message communicates effectively the aim of the business with stakeholders
    
    
• Revising the business aim and revisiting the mission statement should be seen as a natural step for growing businesses
  • It is a chance to involve a variety of stakeholders including workers and suppliers in determining the direction of the business
  • Newly-identified opportunities and threats can be acknowledged
  • Sharing refreshed priorities, particularly with the media can generate positive publicity