Theme 3 Topic 1
Corporate Objectives
Mission Statements
Mission statement – a qualitative statement of why the business exists i.e. its overall purpose
Advantages of Mission Statements:
Gives a sense of purpose to all staff
Makes decision making easier
Giving staff a sense of belonging and purpose – can motivate them (Maslow – security needs)
Helps in setting strategic objectives and corporate plans
Criticisms of Mission Statements:
May just be used as a PR gimmick rather than serve a purpose
Many employees pay little attention to them or are unaware of them
If managers ignore it then many other staff will e.g. if staff suggestions to delight the customer are
constantly ruled out by managers due to the cost
Difficult to measure as just qualitative aims
Key Terms:
Aims – long term intentions which allow objectives to be set. Normally aims are qualitative statements e.g. “to
achieve profitable and sustainable growth
Corporate objectives – specific and measurable targets set by the company
Corporate strategy – a medium to long term plan of how the firm will achieve its corporate objectives
Hierarchy of objective setting:
Mission statement -> corporate aims -> corporate objectives -> functional objectives
Types of Functional Areas and their Objectives
Marketing Operations Human Resources Finance
e.g. e.g. e.g. e.g.
Increase market share Minimise costs Reduce labour turnover Improve cash flow
Increase brand Increase capacity Reduce absenteeism Ensure borrowing is
popularity utilisation Increase productivity reduced
Increase quality
Development of Corporate Objectives
Objectives need to be:
Specific
Measurable
Achievable
Realistic
Time bound
Corporate Objectives
Mission Statements
Mission statement – a qualitative statement of why the business exists i.e. its overall purpose
Advantages of Mission Statements:
Gives a sense of purpose to all staff
Makes decision making easier
Giving staff a sense of belonging and purpose – can motivate them (Maslow – security needs)
Helps in setting strategic objectives and corporate plans
Criticisms of Mission Statements:
May just be used as a PR gimmick rather than serve a purpose
Many employees pay little attention to them or are unaware of them
If managers ignore it then many other staff will e.g. if staff suggestions to delight the customer are
constantly ruled out by managers due to the cost
Difficult to measure as just qualitative aims
Key Terms:
Aims – long term intentions which allow objectives to be set. Normally aims are qualitative statements e.g. “to
achieve profitable and sustainable growth
Corporate objectives – specific and measurable targets set by the company
Corporate strategy – a medium to long term plan of how the firm will achieve its corporate objectives
Hierarchy of objective setting:
Mission statement -> corporate aims -> corporate objectives -> functional objectives
Types of Functional Areas and their Objectives
Marketing Operations Human Resources Finance
e.g. e.g. e.g. e.g.
Increase market share Minimise costs Reduce labour turnover Improve cash flow
Increase brand Increase capacity Reduce absenteeism Ensure borrowing is
popularity utilisation Increase productivity reduced
Increase quality
Development of Corporate Objectives
Objectives need to be:
Specific
Measurable
Achievable
Realistic
Time bound
