Above are 8 examples of aims. A business may have many aims but it would be wise for the business to select between 1 and 3 aims which are appropriate to what the business is/does.
Why Do businesses Need Objectives?
Business Objectives tend to be more specific than aims. These are targets which are set to help achieve the aims of the businesses. This helps as it is easier to achieve an aim if it is split up into smaller steps.
However some objectives are not very specific or clear. This is where SMART objectives come into businesses.
Specific This is a clear definition often including a number.
Measurable This means that the objective can be checked.
Achievable This means that you can achieve the objective.
Realistic This means that the target is sensible so you can achieve it.
Time – Related This means that you set a date by which you need to achieve the objective by.
E.g.
Objective Save money for a holiday
Specific Save £20 a week
Measurable Bank the money you save, the bank statement is the record and measures your achievement.
Achievable Saving £20 is achievable without having to make too many sacrifices, if it is not achievable, take it down to £15.
Realistic You cannot save £20 a week if you do not have a job which pays that at least that amount.
Time – Related Set a time limit like 6 months.
By setting a SMART objective, it is clear what you need to do and how to
do it which means you stand more of a chance of achieving the aim.
Examples of Businesses and Their Aims & Objectives
Example of a Business in the Private Sector:
McDonald’s
What does the business do?
McDonalds provides a service, the business sells fast food – burgers, milkshakes, drinks, wraps and more.
What is the business’ Public Aim (Mission Statement)?
McDonald’s aims to provide a refreshing and insighting experience, with mouth-watering burgers& milkshakes for all ages.
What is the business’ Private Aim?
McDonald’s Private aim is to make money; they only issue an aim to the public so they can lure them into the restaurant.
What are the business’ Aims and how can they achieve these?
To Maximise Profit
McDonald’s aim to maximise profit, they want to make as much money as they can. They do this by introducing initiatives such as “add more fries and a large drink to your meal for only 30p”. This is maximising profit as they already have the customer in the shop, buying a meal; they are just squeezing more money out of them.
They can achieve this aim with the following objectives:
Good Service
By offering good customer service and a quick service McDonalds can persuade customers to come there rather than elsewhere. With this McDonalds will make more money.
An effective Menu
If McDonalds produce a simple and colourful menu so customers will find it easy to find what they want.
Reasonable Prices
McDonalds would want to keep their prices reasonable so they attract customers but they need to also keep it as high as possible so they can continue to make profit.
To Increase Market Share
McDonald’s aim to increase market share by doing more deals etc. to take customers away from other rivals in the business such as KFC, Burger King & Subway.
They can achieve this aim with the following objectives:
Good Service
By offering good customer service and a quick service McDonalds can persuade customers to come there rather than elsewhere.
Reasonable Prices
McDonalds would want to keep their prices reasonable so they attract customers from other restaurants.
Quality Food
By ensuring that McDonalds uses quality ingredients and meat the customers will be more satisfied once they have eaten at McDonalds. Then if the choice comes and they have to choose between McDonalds and another restaurant, they would choose McDonalds because of the quality.
Example of a Business in the Public Sector:
NHS
What does the business do?
The NHS provides a service for the public free of charge (although some would say we pay for the service in our taxes).
When the NHS was launched in 1948, it had 3 core principles:
- That it met the needs of everyone,
- That it be free at the point of delivery,
- That it be based on clinical need, not ability to pay.
However, in July 2000, a full-scale modernisation programme was launched and new principles added. These require that:
- The NHS will provide a comprehensive range of services.
- The NHS will shape its services around the needs and preferences of individual patients, their families and their careers.
- The NHS will respond to the different needs of different populations.
- The NHS will work continuously to improve the quality of services and to minimize errors.
- The NHS will support and value its staff.
- Public funds for healthcare will be devoted solely to NHS patients.
- The NHS will work with others to ensure a seamless service for patients.
- The NHS will help to keep people healthy and work to reduce health inequalities.
- The NHS will respect the confidentiality of individual patients and provide open access to information about services, treatment and performance.
What is the business’ Public Aim (Mission Statement)?
To provide a quality service for the public and help them at their time of need.
What is the business’ Private Aim?
The NHS’s private aim is the same as their Public Aim as they are not a profit making company & they do not need to persuade people to come to their business opposed to McDonalds as previously mentioned in this report.
What are the business’ Aims?
To Survive & Break Even
To ensure that the business does not fail and ensure that it continues to run. The business also needs to break even so they at least cover all costs.
They can achieve this aim with the following objectives:
Charismatic staff
By having charismatic staff the NHS can hope to raise more money from donations and at events etc. as the staff will be good at speaking and persuading people to part with their money for the benefit of the NHS.
Use Money Effectively
If the NHS uses the money it does have effectively and efficiently then they will have more money left over to do other things. For e.g. they could tape up a leg cast when someone is re using their leg cast rather than make a new one, also when they buy a big set of bandages, buy them together and persuade the seller to give the NHS a discount.
Employ Good Staff
The NHS needs to employ staff who work well and do more than they need to, it is better if one person works at 110%, as if you get 10 people who work like that you save approximately £20,000 on one person by not employing them. So when interviewing the NHS needs to be cautious on which candidates they select.
To Improve Services
The NHS wants to improve the service it provides to the public.
They can achieve this aim with the following objectives:
Good Service
By offering good service at reception and in other places in buildings. If the staff work well people will be more impressed with the NHS and this could result in them donating some money towards the business.
Modern Waiting Areas
If the NHS tries to keep its waiting areas up to date customers will be more satisfied with the service. The business could do this by buying furniture in one big purchase for several buildings across the country. Like this they could try and persuade the seller to give them a discount. Also, simple things like asking employees to bring in their magazines once they have finished with them.
Service User feedback
If the NHS asks its service users what they thought about their experience of using the service and how they feel the service could be improved, it will know what needs to be improved. The staff may not understand what improvements are needed as they are not the ones receiving the service. By asking the service users the NHS can really understand what they want and can hopefully provide it.
McDonald’s & The NHS
McDonalds and the NHS are two very contrasting business. How they are different is explained below.
Case Study: McDonalds
Ownership: Private Limited Company & Franchises
McDonald’s is a Private Limited Company because not anyone can buy a share; it is controlled and is owned by a person or some people. However, some of the McDonalds’s that are seen in places are franchises. So here somebody pays McDonalds’s a percentage of their revenue to use their name/brand. This makes the ownership of McDonald’s very confusing because it is a Private Limited Company, but also a Franchise.
Size: Large
The size of McDonald’s is large as it has well over 250 staff. The table below shows how many staff McDonalds had employed in 2001.
Total employees (not including franchisees' staff) = 47,500
Total employees (including franchisees’ staff) = 72,500
Again, business is confusing when you look at the size of McDonald’s. The size is definitely large as it has well over 250 staff. However, the number of staff in 2001 alone changes considerably when you add the franchises number. So McDonald’s as a Private Limited Company had 47,500 staff and McDonald’s as a Franchise had 25,00 staff. But as a general business McDonald’s had 72,500 staff in 2001.
Now McDonalds employs over 5 million people all over the world. This shows how the business has grown in just 8 years.
Scale: Global
McDonald’s is a global company as it has Franchises all over the world. But if it didn’t have the Franchises would it still be global or would it be Continental or even international?
Sector of Business: Private
McDonald’s is trying to make money; profit so it is a private business.
Sector of Industry: Primary & Secondary & Tertiary
McDonald’s initially provided a service to the public so it was tertiary. However, when McDonald’s made a lot of money the owner/owners (as this could also have changed) will have thought ‘Maybe we could make more money by making the food ourselves’. Then McDonald’s actually got the raw materials and made them so it was Secondary. Then McDonald’s decided to buy some farms and actually in essence make the raw materials. Now it is a Primary, Secondary and Tertiary business.
Purpose: To make profit
The purpose of McDonald’s is to make a profit. As McDonald’s has grown in size over time and has also become a Franchise it has made profit there as it takes a cut of the Franchises’ profit. As it has become a Secondary and Primary business it has saved money from buying the meat from other companies, thus making more profit. So over time the business itself has found new ways to make profit but this is a part of the business which has not changed, McDonald’s is still trying to make profit, just in new ways.
Case Study: The NHS
Ownership: State Owned
The NHS is in the public sector; it is state owned. Although the service is free, some would disagree as in the UK more or less everybody is taxed. The money the government receives from these taxes contributes to paying for the service. So is the NHS owned by us, the public or is it owned by the Government?
Size: Large
The size of the NHS is large as it has well over 250 staff. The NHS currently employs just over 1.3 million staff.
Over 80% (1.13 million) are frontline staff. Of these (675,000) are professionally qualified clinical staff, e.g. 126,000 doctors and 398,000 qualified nurses. They are supported by 454,000 staff in trusts and GP practices.
The remainder (209,000) are NHS infrastructure support staff, with nearly a half (102,000) of them in central functions, just over a third (71,000) in hotel, property & estates and just under a fifth (37,000) are managers.
Scale: National
The NHS is a national service as it is only in the UK.
Sector of Business: Public
The NHS is not trying to make money, but offering a service so it is a Public business.
Sector of Industry: Secondary & Tertiary
The NHS provides a service so it is in the tertiary sector. However it is arguable that the business is also in the secondary sector as a lot of the resources it uses, e.g. leg casts, braces etc. are made by the NHS.
Purpose: To Provide a Service
The purpose of the NHS is to make provide a service. As time has gone on the NHS has changed, it has grown. However its core principle has remained the same, to provide a service for the Citizens of the United Kingdom.
Similarities & Differences of
McDonalds & The NHS
Similarities:
As shown in the table above, there are only two similarities between the two businesses. These are underlined. The size of both businesses is large as they both have well over 250 staff; McDonald’s having over 5 million staff and the NHS having just over 1.3 million staff. The second similarity between these two giant businesses is that of sector of industry – both are in the secondary and tertiary sectors. McDonalds make their own burgers and milkshakes etc. and then sell to the public. The NHS does the same of a sort, they make some bandages and casts etc. and use these resources for the benefit of the public. However the NHS does still use other resources bought from businesses in the secondary sector.
Differences:
There are many differences between these two businesses, and there are many reasons for this. Firstly the ownership of the businesses is different, McDonalds being a PLC & a Franchise and the NHS being a state owned business. Another difference is that the scale of these two businesses; McDonalds being global and the NHS being National. A factor affecting this is definitely the size of the businesses. Although both fall under large, the difference between both is vast, over 3.5 million. It is because of McDonalds employing so many people that it is global, but in this circumstance is it appropriate for McDonald’s to fall under the same size group as a National business? Another difference is that McDonalds is also in the primary sector, they get the raw materials (e.g. beef) themselves. This could be a reason for McDonalds being so much bigger than the NHS, they save money by not having to buy the raw materials. These two businesses are also different in their sectors of business, the NHS being in the public sector and McDonalds in the private sector. It is because of the sectors of business that their business purposes are so different, McDonalds wanting to make money and the NHS wanting to provide a service. Thus the final difference being that McDonalds is a profit making business and the NHS is not.
Different Aims & Objectives
As previously shown in this report both McDonalds & the NHS are 2 very different and contrasting businesses. Thus they both have very different Aims & Objectives, but why?
McDonalds aims to maximise profit as they are all ready making profit and they want more money. This is mainly because it is a PLC and the owners want to get richer and richer. Opposed to this the NHS is not a profit making organisation so rather than them wanting to make profit, they want to improve their service and to ensure that they survive. This is because it is a state owned business.
Essentially it is the purpose of the business that decides what the business aims to do. McDonald’s purpose is to make money in anyway possible so that is what it does, it makes money. On the other hand the NHS’s purpose is to provide a good service to the public and not to make a profit so the businesses aims are to improve its service and to ensure that it survives (Breaks-Even).