Chapter 2 - Objectives and Stakeholders Flashcards
Ashridge College model of mission
links business strategy to culture and ethics
Purpose - why does co exist
Values - beliefs and morale principles
Strategy - commercial logic (resources
Policies + Standards of behaviour - how business should be conducted
Mission statement - Definition (by CIMA)
A published statement, apparently of the entity’s fundamental objectives.
A Mission is an entity’s fundamental objectives expressed in general terms.
Mission statement criticism
- PR exercise
- Generalization
- may ignore formulation or implementation of strategy
Mission statement upsides
- Inspires and informs
- Screening
- Implementation
Vision statement
Answers:
- What do we want to achieve?
- Where is the Org going?
Goals can be
Hierarchically: top mission, underneath are goals
Functionally: colleagues work on a project
Logistically: resources shared or used in sequence
In wider Org sense: set priorities
Objects should be SMART:
Specific Measurable Achievable Relevant Timed
Functions of objectives are:
Planning (enables)
Responsibility (assigns)
Integration (consistent)
Motivation (what has to be done - in all areas)
Evaluation (performance vs objectives = control)
Examples of financial and non-financial objectives
profitability
market share
growth
cash flow
customer satisfaction
quality of products
HR
New products
Levels of objectives
Corporate: establish objectives and derive strategy
Department: Mfg or Mrkting Objectives
Operational level: Scheduling programs and action plans
Time horizon of objectives
Strategic: overall, long-term
Tactical: used for operational goals, mid term
Operational: day2day
Marketing goal samples:
Market leadership
Coverage
Positioning
Expansion
Product and service goal samples:
Labour productivity or output per employee
Capital productivity
Quality objectives
Technology
Methods for dealing with conflicting goals:
rational evaluation bargaining among managers just satisfying some targets in order to achieve multiple goals sequential priority setting exercise power
Critical success factors (CSF’s)
Elements of the org activity which are central to its success. CSF may change over time and may include: product quality, employee attitudes, mfg flexibility, brand awareness
Setting CSF’s
Identify them
Identify underlying competences
Ensure match between competences and CSF’s
develop performance std’s
ensure std’s cannot be match by competitors (to form competitive advantages)
Monitor competitors
Short vs long term goals
trade-off between short vs long term objectives occur if they are in conflict or resources are scarce.
Stakeholder definition
Persons or Org’s with an interest in the strategy of the Org. These include shareholders, customers, staff and local community.
Mendelow’s stakeholder map
Interest vs Power
LOW LOW: minimal effort
HIGH LOW: keep informed
LOW HIGH: keep satisfied
HIGH HIGH: key player - communicate regularly
Groups of stakeholders
Internal: managers, employees
Connected ones: Shareholders, Bankers, Suppliers, Customers
External ones: Government, Interest/Pressure Groups, Industry associates, trade unions, NGO’s
Resolution of stakeholder issues
satisfying
sequential attention
side payments
exercise power
Business ethics (by CIMA): 5
integrity objectivity professional competence (and due care) confidentiality professional
Threats to ethical prinicples
self-interest: own benefit self-review: revising own past decision advocacy: promoting client or employer beyond objectivity familiarity: too close relations intimidation: by threaths
Ethical safeguards
Public: professional bodies, legislation, regulation
In the work environment: complaint systems, draw attention to unprofessional or unethical behaviour.
