Business objectives

Defining Business Objectives

  • Business objectives: These are the goals that a business wants to achieve, set out in a formal and official manner.
  • Each business can have multiple objectives that compete with each other, and prioritising these objectives is a key part of strategy.
  • Objectives provide a direction for the company, and can help to guide decision-making and strategy.
  • They also offer targets that can be measured to assess the performance and success of a business.
  • The nature of business objectives can differ depending on the type of business. For example, a non-profit organisation will likely prioritise different objectives to a profit-making business.

Common Types of Business Objectives

  • Survival: In the early stages of a business, the main objective may simply be to survive and keep the business running.
  • Profit Maximisation: For many businesses, the primary objective is to maximise profit.
  • Growth: This could involve expanding the business, such as by opening more branches or entering new marketplaces.
  • Increasing Market Share: To dominate the market, a business may aim to increase its share.
  • Corporate Social Responsibility: Some businesses prioritise having a positive impact on society, whether through ethical considerations, environmental sustainability, or other means.
  • Improving Business Reputation: A good reputation can be critical for success, so many businesses make this an objective.

Objectives Change Over Time

  • As a business grows and develops, its objectives will likely change.
  • For example, a start-up may initially focus on survival, and later on move towards objectives relating to expansion or profit maximisation.
  • Sometimes, events can cause a business to rethink its objectives, such as new competition entering the market, or changes in laws and regulations.

Business Objectives and Stakeholders

  • Different stakeholders might have interest in different business objectives. For instance, employees may more closely align with objectives around stability and fair pay, while investors might be more concerned with profit and growth.
  • Successful businesses often manage to balance the needs and wants of different stakeholders.