This report is about aim and objectives for businesses, what mean SMART objectives, why is beneficial for businesses to set aims and objectives and also what kind of aims and objectives has TESCO as a supermarket.

REPORT

Aims & Objectives

To Mr Kobie Sandstone – manager of Enterpreneurs

From Aleksandra Pluta – Assistant Advisor

This report is about aim and objectives for businesses, what mean SMART objectives, why is beneficial for businesses to set aims and objectives and also what kind of aims and objectives has TESCO as a supermarket.

20. 09. 2011-09-24

Aims (P1)

Business activity is focused around the achievement of business aims.

A business aims is a target or goal that business want to achieve in the future. It is a statement of purpose, for example: we want to grow the business into Europe.

Most business share their aims with the staff to motivate them, as they can see how their hard work helps the company. It also enables all employees to work towards the same goals and outcomes. The settings of the aims is usually done by the director, managers and employees which means that they all have input and, it is hoped, will agree with the aims.

The aims of business:

Most businesses aim to make profit. Some business try to make profit as much profit as possible, others just try to make a satisfactory profit.
Survival – new business are often risky because they have a less experience. It also takes time to build up regular customers. Survival might also be an aim if a business has problems such as low sales. This can happen if the economy is in a recession
Maximising sales or quality – some business aim to maximise sales. This can put the business in a strong position in the market. Some business try to maximise the quality of their products and how they are made. This should lead to fewer production faults and better products.
Providing products – some businesses aim to provide goods and services that people in the local area need. For example: a hairdressing salon or a local bus service. Other businesses provide goods or services for all people in a country, such as electricity. Some businesses sell their goods worldwide, such as Coca-Cola.
Providing service – Many businesses try to offer a better service than the case in very competitive markets, such as supermarket or mobile phone companies. They might try to offer a wider variety of products or make it easier for customer to buy them.
Offering a charitable or voluntary service – some organisations are non-profit making, such as Oxfam. They aim to sell products and donate the money to worthy and needy causes, such as helping children, older people etc.
Environmentally friendly – some businesses are concerned about their impact on the environment. They try to protect the environment by keeping pollution or waste to a minimum such as The Body Shop.

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Objective

Business activity is focused around the achievement of appropriate business objectives. Objectives are more precise than aims and can be measure. It is detailed picture of a step you plan to take in order to achieve a started aim. It is a sub goal, a short-term step moving toward achieving a long-term goal. They are smaller, more specific targets that help to achieve an overall aim. We want to achieve sales of £10 million in Europe market in 2012.

Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. ...

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Objective

Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. This can motivate employees. By measuring how well an objectives has or has not been achieved, managers can make necessary changes to their activities to ensure progress and achievement of the stated objectives are made in time.

The most effective business objectives meet the SMART criteria:

S – Specific – clear and easy to understand. To make goals specific, they must tell a team exactly what is expected, why is it important, who’s involved, where is it going to happen and which attributes are important. E.g. Company want to sell 10 dresses in one week.
M – Measurable – measuring progress is supposed to help team stay on track, reach its target dates. The business can put a value to the objective e.g. £10 000 in sales in the next 6 months.
A- Achievable – they can achieve the target if they stretch a little.
R – Realistic – the objectives should be challenging, but it should be also be able to be achieved.
T- Time specific – they have a time limit of where the objectives should be achieved, e.g. by the end of this month, year.

The first known uses of the term ocur in November 1981 issue of Management Review by George T. Doran.

The objectives for business

A business might want to sell than the other businesses, it might want to reduce its cost, to produce a better product, want its sales to grow. Public sector organisations like Inland Revenue set objectives for service, such as processing customers, tax return within a given time period .Private sector organisations like Kelloggs might set objectives for customer satisfaction. Objectives are not a function of type of ownership or scale of activity. A sole trader and a multinational public limited company could both be profit maximisers so the focus needs to be on aims and objectives.

Why it is beneficial for business to set aims and objectives? (P2)

It is very important to have an aims and objectives because it provide a focus for business to see what are trying to aim for. Aims and objectives keep everyone focused and working to meet the targets, it also helps compare how well you are going even if you don’t meet the target.

If you don't set aims and objectives it is impossible to make plans to achieve anything. You must know what you are trying to do before you can decide how to go about doing it.

Without aim and objectives there is no meaning to the business.

The main purposes for setting aims are to give general directions:

Profit maximisation – to make the most profit possible, most like to be the aim of the owners and shareholders companies like : BP, Malik LTd
Survival – main aim for new firm enter the market or at time of crisis like : police force, Duke Maintenance
Growth – where the business tries to make as many sales as possible, or when they want to open more branches, like: BP, IKEA, Children Charities, or retail store.
Service Provision – by offering a new services link like online shopping, insurance, restaurant, or improve current service to attract more client like free delivery for new customers etc. GP, Children Charities, TESCO, IKEA, KFC, Inland Revenue
Break – even – where the business make money to invest them to the company like Children Charity.
Market share – where the company tries to take business away from their competitors like BP, retail store, Richer Sounds
Relationship with other businesses – where the business tries to join to other companies to offer goods of services to more people, like GP.

Purpose for settings objectives:

To give owners and all management better control on the business.
To provide standard for specialist action.

Write aims and objectives for a selected business in one of the business sector (P3)

As Britain’s largest retailer and the fourth largest in the world, Tesco try to meet their objective by providing their customers with excellent value for their money with highly competitive prices and excellent customer service. Ultimately, by pleasing their customers and capturing their business for life this will make them a highly profitable business which in turn also pleases their shareholders which in the end is the true objective of all for profit companies.

According to Tesco (as found on their corporate website at www.tesco.com), their core purpose is "to create value for customers to earn their lifetime loyalty." They further go on to state that their success depends on people, both those who shop with and work with them.

The aims and objectives of Tesco are based on 4 P's of marketing which are Product, Price, Place and Public.

Product - having the right product range for the customers. This differs from store to store and area to area.

Price - keeping their prices competitive.

Place - accessible locations for customers.

Public - thinking of their public. Their corporate and social responsibility is spoken about by their PR team frequently and they do give to charity and the local community out of their profits.

Tesco can see buying patterns from their Clubcard information and this gives them the insight into what people want and what is in demand which helps achieve these customer led goals.

References