Aims and objectives Every business exists for a purpose. It may sell goods or services. Vodafone sells network coverage (services) and mobile phones (goods).
Businesses must make a profit to exist. They need to know what they want to do and how they want to do it to attract and keep customers. Therefore, all businesses must have aims and objectives that identify what they wish to achieve.
Aims and objectives Aims are what the business wants to achieve, e.g. make a profit, be the best, attract new customers, etc.
Objectives are the targets that businesses set themselves to help them to achieve their aims.
Aims of a business The aims of an organization often include to: create a profit or surplus funds sell or provide goods or services survive expand maximize sales improve product quality beat the competition provide voluntary services be kind to the environment. Why are aims important to businesses?
Aims of private sector organizations Organizations are divided into two sectors: private and public. The sectors have different aims as they do different things. Private sector businesses aim to make a profit to survive. They are usually owned by private individuals or groups. Businesses in the private sector can vary enormously in size – your local corner shop and the national chain Tesco are both in the private sector. Can you think of five private sector businesses?
Aims of public sector organizations Public sector organizations are owned or controlled by the government or regional authorities. They are not businesses because they are not seeking a profit; most of their money comes from funds that are acquired through taxes. However, public sector organizations often have similar aims to businesses, because they also need to run efficiently. Some industries, such as gas, postal, electricity, phone and railway, used to be in the public sector but were privatized to be more efficient. Can you think of five public sector organizations?
Personal aims and objectives We all have aims – your aim might be to pass your exams, save money or get fit. In order to achieve your aims you must set yourself objectives; for example, do your homework on time, save £5 per week, or exercise daily. Setting objectives (targets) will help you to achieve your aim. How might objectives help businesses to achieve their aims?
SMART objectives Organizations set themselves objectives to help them to achieve their aims. Many set SMART objectives: Specific
1. Specific means particular: not vague
Measurable
2. Can be measured numerically
Achievable
3. Can be achieved
Realistic Timed
4. Are realistic for the organization 5. Have a deadline
What does each part of a SMART objective mean?
Aims and objectives Creating objectives can help an organization to measure its performance – to make sure that it is achieving its aims. They should be agreed by the people who have to achieve them to improve the chances of success. Here is an example of an aim with its SMART objective: Aim: Objective:
make a profit increase sales by 10% in the next six months
Write down a personal aim. Set a SMART objective and explain how it will help you to achieve it.