Questions and Answers
What does the 'S' in SMART stand for?
Which of the following attributes describes the 'M' in SMART?
What is a key characteristic of an Achievable objective in SMART?
In the hierarchy of objectives, where do corporate objectives generally reside?
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Which key area relates to customer satisfaction and product range among corporate objectives?
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What does the 'T' in SMART objectives signify?
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What is an example of a functional objective in supporting corporate objectives?
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Which of the following is NOT typically considered a corporate objective?
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Which of the following is considered a potential business weakness?
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What represents a business opportunity in today's markets?
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Which of the following would be classified as a threat to a business?
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Which potential weakness can directly affect a business's competitive edge?
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Which of the following could be a source of business opportunity?
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What is an example of a weakness related to a company's workforce?
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What is the main concern of short-termism in business management?
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Which factor does NOT typically contribute to short-termism in businesses?
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How does competitive pressure influence business strategy?
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What impact does social and technological change have on decision-making in businesses?
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What does not reflect the concerns surrounding the political and legal environment?
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What is a consequence of external investor pressure for businesses?
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Which functional objective best supports the corporate objective of increasing sales?
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What internal influence focuses on the values and beliefs that guide decision-making in a business?
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Which of the following influences is considered an external factor affecting corporate objectives?
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To improve customer satisfaction, which functional objective should be targeted?
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What internal influence relates to the ability of business owners to shape goals?
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Which of the following best describes an operational functional objective?
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Which of the following is NOT an internal influence on corporate objectives?
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What is the goal of reducing the average payment time for invoices in finance?
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What is a primary characteristic of strategic decisions?
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Which of the following is an example of a tactical decision?
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How does short-termism affect business management?
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What is the primary goal of corporate objectives?
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Which of the following statements best describes tactics?
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In SWOT analysis, which aspects are primarily analyzed?
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What differentiates strategic decisions from tactical decisions?
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Which of the following best exemplifies a strategic decision?
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Study Notes
SMART Objectives
- Specific: Clearly define what is to be achieved.
- Measurable: Ensure objectives can be quantified to assess achievement.
- Achievable: Set realistic goals based on resources and circumstances.
- Relevant: Align objectives with the responsibilities of those achieving them.
- Time Bound: Establish a practical timeframe for achieving objectives.
Hierarchy of Objectives
- Corporate objectives are at the top, guiding more specific tactical and operational objectives.
- Key areas impacted by corporate objectives include market, innovation, productivity, resource management, profitability, management, employee relations, and public responsibility.
Corporate and Functional Objectives
- Corporate objectives drive the direction of a business. Examples include:
- Market share and customer satisfaction.
- Introduction of new products.
- Optimizing resource use.
- Financial performance metrics.
- Employee development and relations.
- Legal compliance and ethical behavior.
- Functional objectives support corporate goals, with examples:
- Marketing aims to launch five new products to increase sales.
- Operations targets a 10% increase in factory productivity to cut costs.
- Finance aims to reduce customer payment time to boost cash flow.
- People management targets high customer service levels.
Influences on Corporate Objectives
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Internal Influences:
- Business Ownership: Owner goals impact objectives.
- Profit Orientation: Focus on profits versus non-profit motives influences objectives.
- Ethical Stance: Ethical considerations shape decision-making.
- Organizational Culture: Structure and culture affect how objectives are set.
- Leadership: Leadership strength influences objectives and decisions.
- Resources: Market position and available resources inform realistic objectives.
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External Influences:
- Short-termism: Pressure for immediate results can undermine long-term strategy.
- Economic Environment: Economic indicators impact objective-setting.
- Political/Legal Environment: Uncertainty in laws can affect corporate goals.
- Competitor Actions: Strategy and actions of competitors shape achievable goals.
- Social and Technological Change: Rapid changes can complicate decision-making and goal-setting.
Short-termism
- Focus on immediate performance often driven by:
- Investor pressure for short-term financial results.
- Management incentives linked to short-term achievements.
- Frequent changes in management or strategy.
Strategy vs. Tactics
- Strategy: Long-term plans set by senior management to achieve objectives.
- Tactics: Short-term, routine plans delegated to junior management to support specific targets.
Examples of Strategic and Tactical Decisions
- Strategic: Entering new markets, pursuing external growth, adopting major strategies like cost minimization.
- Tactical: Relocating staff, choosing locations, identifying specific cost savings, implementing marketing campaigns.
Key Terms
- Corporate Objectives: Goals related to overall business performance, guiding strategic decisions.
- Short-termism: Predominant focus on short-term results, potentially harming long-term performance.
SWOT Analysis
- Strengths and Weaknesses: Analyze internal capabilities, identify weaknesses as areas for improvement (e.g., low market share, outdated technology).
- Opportunities: Identify external factors that offer positive potential (e.g., technological innovations, market growth).
- Threats: Assess external risks that could obstruct achieving objectives (e.g., competition, regulatory changes).
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Description
Explore the SMART framework for setting effective corporate objectives. This quiz covers the definitions of Specific, Measurable, Achievable, Relevant, and Time-bound objectives essential for strategic planning in a business context.