Business Objectives Business objectives are a set of targets that an organization wants to achieve in the future. In order to achieve these goals, a business makes plans which are said to be the `means to the end`. These objectives and plans should be made keeping in mind the interests of all the stakeholders of the business. It is the responsibility of managers to make decisions about the future of the company and make plans about how to achieve those decisions. All organizations set up a mission and well-defined goals and plans for carrying out this mission.
Companies that do not have simple or clear objectives are unable to achieve their targets and may suffer. (Business objectives, planning and stakeholders, Web). Along with an improved financial and operational performance, the objectives of a business benefit the organization in a number of ways. The objectives of the business describe the reason for its existence and also motivate the employees as they are aware of the purpose of their work and how it affects the organization as a whole. They also act as resource allocators as managers can decide where to allocate their resources to.
The most important benefit of objectives is that they are a standard of performance through which the performance of a business could be assessed. In order for these objectives to be efficient, they must fulfill a set of criteria. Firstly, these objectives should be for a defined time period so that employees can keep a track of the goals. Secondly, they should be in quantitative terms so that they are defined precisely and should also allow a certain level of progress.
Also, these objectives should be direct and clear but challenging and realistic at the same time so that employees are motivated. The objectives should also be `linked to rewards` so that employees work diligently towards the goals so as to get rewarded for their task (Richard Daft, Web). Every organization has different objectives depending on the part of the business cycle it is in. Survival is a short term objective, usually for new businesses or for those businesses who try to enter a market during a crisis, during a boom or a recession period.
If this is so, then the business should invest all its resources towards attracting as many customers as possible to capture a certain level of market for survival. Some people believe that the main objective of all businesses should be to maximize the amount of profits they earn. This objective is mainly the concern of owners and shareholders as they have taken the risk by investing their capital in the business. Therefore, they want to earn as much profit as possible in order to get a reward for the risks taken (Organization- Aims and Objectives, Web).
Sales maximization is also one of the objectives that a business has. The main aim is to make as much sales as possible by employing as much resources towards it. The company tries to increase their sales by attracting a large number of customers by marketing their product, extensively or even by developing their product to satisfy the needs of the customers. The company can also cut prices or give discounts in order to make large sales.
Sometimes, this goal is in conflict with the goal of profit maximization as cutting prices will eventually result in a decrease in short term profits. Therefore, the company must have clear and well-defined objectives. Another objective that businesses have is of profit satisficing. Profit satisficing is earning enough profits to satisfy the shareholders and owners of the company. Smaller companies usually have the objective of profit satisficing as they are concerned with the profits and do not want to work for longer hours or even to invest a large number of resources in the company.
The objectives of a business also depend on the type of business it is. If it is a public sector organization then their main objective is to provide services to the public. There are also some not-for-profit organizations which work for the betterment of their society. (Organization- Aims and Objectives, Web). An efficient and successful company must have direct and clear-cut objectives in order to avoid as many conflicts as possible. A company should distinguish between its short term and long term goals as well so that the future of the company is not compromised.
In recent years, the concept of sustainability has evolved in the business world and thousands of companies have adopted sustainable practices. According to a UN report, sustainability is providing the needs of the resent generation without compromising on the ability of the future generations. Previously, private companies were only working for the environment when they were forced by the government but today, today many companies have adopted these practices in order to reduce the adverse effects that their operations on the environment and on the community as a whole.
In the past, sustainability was the protection of the environment but in recent years, it has become evident that along with the protection of the environment, rising population should also be controlled for a sustainable environment. Its focus has shifted to economic and social improvement and companies have also realized their corporate social responsibility towards their community. As a result, companies have tried to work in an eco-friendly way and also by trying to help the needy areas within their countries as well as internationally.
Ultimately, it is the responsibility of the Board of directors to take action by devising such a mission and objectives that fulfills their responsibility of a corporate social citizen (The Road to sustainability: Business` first steps, Web). Works Cited "Business objectives, planning and stakeholders Aims and objectives business studies and business english | The Times 100." The Times 100 - Teaching business studies by example. N.p. , n. d. Web. 26 Sept. 2012.. "Organisation - Aims & Objectives. " tutor2u | Economics | Business Studies | Politics | Sociology | History | Law | Marketing | Accounting | Business Strategy.
N. p., n.d. Web. 26 Sept. 2012.. Daft, Richard L., and Pat Lane. "Managerial Planning And Goal Setting. " Management. 9th ed. Chicago: Dryden Press, 1991. 160-168. Print. “The Road to sustainability: Business` first steps. ” The Conference Board. 7-12. N. p. n. d. Web. 26 Sept. 2012.