...Topic 1: Business Organisation and Environment 1.3 Organisational Objectives • “If you don’t know where you are going, you’ll end up someplace else.” – “Yogi” Berra, Major League Baseball player and manager. Why do we need objectives? • • • • • • • • • Implement the mission/vision Focus for decision making Set target Motivate employees Have control over actual performance Provide criteria for evaluating performance Reduce uncertainty Provide sense of unity Positive image Hierarchy of Objectives Hierarchy of Objectives Mission and Vision • “Guiding Hand” • Written by senior management. Strategic Objectives • Practical Application of Mission • Allows lower management to make sense of the mission. Tactical Objectives • Elements of mission in practice • Day-today focus for all employees. Hierarchy of Objectives • Objectives run down, becoming more specific. • Overall objectives are replaced, with more relevant ones. • Hierarchy ensures consistency. Objectives • LO1: Explain the importance of objectives in managing an organization. • LO2: Distinguish between objectives, strategies and tactics, and discuss how these interrelate. Objectives • Traditional Objectives – Survival / Breakeven – Cost minimisation – Profit maximisation – Growth (market share) – Profit satisficing Market Share • Relating to this, what could some objectives be for these firms? • What was released on 29th June , 2007? • What does this chart look...
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...Taking Charge at Domtar: What it Takes for Turnaround 1. How did Domtar’s strategies align with its mission? Explain your answer. Domtar’s mission under new CEO Raymond Royer: * Meet the ever-changing needs of our customers, * Provide shareholders with attractive returns, and * Create an environment in which shared human values and personal commitment prevail. In order to achieve the goals in the Domtar mission statement, Royer established and communicated strategic direction and specific goals. The new strategic direction that Royer set for the company was one of preferred supplier status in the pulp and paper industry. The organization’s new goals focused on vastly improving return on investment and quality in customer service. Domtar was able to achieve and surpass its goals, all while keeping costs down, by focusing on Royer’s three pillars to the company: customers, shareholders, and ourselves. Notice the clear alignment when you compare Domtar’s mission, goals and pillars. The key component is what Royer meant by “ourselves.” He meant tapping into and motivating ALL employees in the organization. Royer knew that he and his executive team could not create the turnaround that Domtar’s balance sheet so desperately needed. Royer himself knew nothing of the pulp and paper industry before coming into the Domtar CEO position. But what he did know was how to create an organizational culture of empowerment, knowledge sharing and process improvement. And that’s...
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... but also helps planners identify what should be done and measured and it enables executives to truly execute their strategies. It also provides feedback from both the internal business processes and external outcomes in order to continuously improve strategic performance and results. A Balanced Scorecard approach generally has four perspectives: 1. Financial perspective Timely and accurate financial data is always needed by an organization. This perspective is concerned with the shareholders view of performance. Shareholders are concerned with many aspects of financial performance, such as market share, revenue growth, profit ratio, and return on investment. 2. Internal business processes perspective This perspective refers to internal business processes. Balanced scorecard measures help managers to know how well their business is running. There are two kinds of business processes in balanced scorecard terms: mission processes that enable the delivery of the organisation's overall mission, and support processes, which are the repetitive tasks people carry out in the course of their work. 3. Learning and growth perspective This perspective includes employee training and corporate cultural attitudes related to both individual and corporate self-improvement. In...
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...software, and personal computers. Apple’s mission and vision summarizes its committed efforts in bringing the best user experience to its customers through its advanced hardware, software, peripherals, and services along with a unique ability to design and develop its own operating system, hardware, application, software, and services, in order to provide its customers new products and solutions with superior case-of-use, seamless integration, an innovative design (“Apple Inc. Form 10-K Annual Report”, 1, 2012). Company’s mission and vision statements against the performance of the organization Apple’s mission and vision statements and objectives are neither interchangeable nor autonomous. Without objectives, the mission and vision statements are impractical. Without the mission and vision statement the objectives have no relevance. Both statements are too broad to be measurable, and the objectives are too definite to provide the big picture. When properly coordinated they strike a balance that helps to shape the business operations and service strategy. Apple Inc.'s mission statement is as follows - Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through innovative hardware, software and internet offerings. The mission statement offers that the organization is concentrated on quality and innovation to reach its target customers. In its mission statement Apple aims to provide customers...
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...Fonterra’s shareholders and key stakeholders Fonterra´s most important shareholders are farmers who own the business and who are suppliers at the same time and the only way how to become a shareholder is to become a supplier. The share of every each farmer depends on the quantity of milk they supply (Knott 2014). Key stakeholders of Fonterra company are New Zealand´s economic markets as a whole, because economics of the company also influences the economics of New Zealand owing to high contribution in export revenues. Also Fonterra controls very high proportion of a liquid milk in domestic markets as well as some other dairy products which has significant impact on a price. Another stakeholders are connected to environmental which is affected by a firm. As a major water consumer and potential polluter of the water sources and ecosystem by fertilizing and methane emissions Fonterra has and impact on New Zealand´s environment and of course on the entire population living within this environment. For stakeholders we can also take overseas partners and suppliers with whom Fonterra established partnership agreements (Knott 2014). 2. Fonterra’s governance structure Fonterra´s governance structure can be described as a cooperation constitution. There is a Board of directors that is responsible for leadership, direction and oversight of Fonterra. The shareholders elect 9 of 13 members and the next four are appointed by the Board and approved by the shareholders at the Annual...
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...of sharing the power between management and shareholders. * Corporate governance is a set of legal, regulatory or practical provisions defining the scope of the power and responsibilities of those responsible for directing the company sustainably. Directing the company means taking and controlling the decisions that have a decisive effect on its soundness and sustainable performance. 3 types of shareholders: speculative, sleeping, active 2. The history of share ownership in continental Europe From 1850 to 1930 : 1/ Company : private sphere * Private property * Family shareholders * Middle age vocabulary 2/ Governance mode: Paternalism * Statistically and ideologically dominant * Scté en commandite par action * Authority legitimacy : Traditional society From 1930 to 1970 1/ Paternalism legitimacy erodes … * 4 constraints: * Demographic * Organisational * Financial * Political 2/ Governance of “experts” * The emergence of technocracy * Marginalization of shareholders * Anonymity * Technocracy self evaluation Since 1970 1/ Mutations and revolutions in the USA a- The increase of the need for financing * Diversification of pension funds * Huge increase pf the capital markets: the capitalization of NY increases from 600 to 17000 billions dollars between 70 and 2000 b- The huge increase of the number of shareholders * Mass saving world wide phenomenon: ...
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...Vision, Mission & Values and Generic Strategy MGMT90146 Strategic Management Week2 Tom Osegowitsch and Dean Xu 1 Today’s Agenda House-keeping Vision, Mission & Values; Generic Strategy Yellow Tail Case Capstone: more tips, team formation. 2 Reference Textbooks Grant, R.M. “Contemporary Strategy Analysis” (recent editions) Blackwell Publishing Dess, G.G., Lumpkin, G.T., & Eisner A.B. “Strategic Management” (recent editions), McGraw-Hill Barney, J.B. & Hesterly, W.S. “Strategic Management and Competitive Advantage” (recent editions) Pearson. Hill, C.L.W., Jones, G.R., Galvin, P., & Haidar, A. “Strategic Management: An Integrated Approach” (recent editions) John Wiley & Sons Australia All available in library. 3 RECALL: Elements of Strategic Management Process Strategic Analysis Strategy Formulation Implementation 4 Strategic Analysis Vision, Mission, Values External Analysis Internal Analysis Vision, mission, values; External Analysis; and Internal Analysis are inputs for Strategy Formulation. 5 VISION, MISSION & VALUES Definitions Three interrelated concepts Terms used rather indiscriminately, sometimes synonymously (also: charter, ideology, creed or credo, ethos…) 6 Definitions (cont’d) Collins & Porras 1996 vs. Mission & Values Vision …as defined in this subject 7 Top Management’s Evolving Role Traditional View Defining a clear strategic plan Emerging View Articulating...
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...daunting to imagine, it serves as somber reminder how valuable nonprofit organizations are to society. Nonprofit organizations exist to cater to the various needs of society, and to accomplish their charitable mission. The service and product offered are not for achieving profits, but to benefit society in a noticeable manner. However, in order for nonprofit organizations to maintain efficiency and meet their goals; it is essential for them to operate to their full capacity by implementing good financial management systems and procedures. Financial management plays a significant role in the overall management of a nonprofit organization. Implementing appropriate financial management systems and practices contribute to a successful business and provides...
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... SunTrust Banks, Inc., with total assets of $170.8 billion on March 31, 2011, is one of the nation’s largest financial services holding companies. Through its flagship subsidiary, SunTrust Bank, the company provides deposit, credit, trust, and investment services to a broad range of retail, business, and institutional clients. Other subsidiaries provide mortgage banking, brokerage, investment management, equipment leasing, and investment banking services. Atlanta-based SunTrust enjoys leading positions in some of the most attractive markets in the United States and also serves clients in selected markets nationally. The Company’s mission is to help people and institutions prosper by providing financial services that meet the needs, exceed the expectations, and enhance the lives of our clients, communities, colleagues, and ultimately our shareholders. SunTrust’s 1,665 retail branches and 2,924 ATMs are located primarily in Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee, Virginia, and the District of Columbia. In addition, SunTrust provides clients with a full selection of technology-based banking channels including online, 24-hour customer services centers, and the latest mobile devices. I am currently an employee of SunTrust Mortgage and the only African –American employee out of 25 people. The prior 2 other African American employees one left the company after 25 years and the other job was eliminated at a time when we are covered with business and overworked...
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...Ford vs Chevrolet Ford and Chevrolet (Chevy) are in the automotive industry and have been in completion for many years start back in 1908, both companies started in the state of Michigan and have been battling it out for profits, market share and hometown bragging rights. Ford was founded in the suburb of Dearborn, Michigan and Chevy was founded in Flint, Michigan. Ford and Chevy both are good-producing sectors, they both manufacture automobiles that are similar but different. They each have a mission statement, Ford’s mission statement “One Team, One Plan, One Goal.” Ford’s mission statement is defined to each part of the statement, One Team meaning people working together as a lean, global enterprise. One Plan meaning aggressively restructure to operate profitably at the current demand and changing model mix, developing new products our customers want and value, finance our plan and improve our balance sheet, and work together as one team. One Goal meaning an exciting viable Ford delivering profitable growth for all. Chevy’s mission statement is an unofficial statement “We win when the customer says we win.” Chevy has an unofficial mission statement but uses more of Five Principles to guide its business, Safety and Quality First, create long-life customers, innovate, deliver long-term investment value and make a positive difference. Both Ford and Chevy are oligopoly competition, being that both companies supplies a large portion of the automotive industry. Being in...
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...on the OD side Organisational Focus vs. Organisational Transformational Focus OD – planned, long term, internal focus (strengthening the company for the future) (evolutionary) OT – unplanned, short term, reactive, external focus (revolutionary) Planned vs. Unplanned Planned change: an organisation’s ability to anticipate and respond to change (implementing new technologies) Unplanned change: organisations have limited time to respond and anticipate change (emerges as a response to unanticipated threat or event) Evolutionary vs. Revolutionary Evolutionary change: Slow, incremental but stable, change individual parts or departments, improve existing products Revolutionary: Fast, massive and establishes new equilibrium, transform entire organisation, new structure/management, introduce new products (Apple created a new smart phone in response to NOKIA, due to Steve Jobs). 1st order and 2nd order change First Order: incremental/episodic, adjustment in systems, changes maintains & develops Second Order: discontinuous, transformational, radical change that fundamentally alters the organisation (Revolutionary) Type of Organisational Change 1. Tuning: Incremental 1st order) 2. Adaptation: Incremental, reactive 3. Reorientation: Strategic 4. Recreation: Strategic, reactive(2nd order) Theory E & O: Suggesting dimensions of change This is an economic approach with a focus on rapidly increasing shareholder value, with emphasis on financial incentives...
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...* “incorporating both shortterm and long term perspectives” * The balancing of Effectiveness vs. Efficiency 2. Briefly discuss the three key activities in the strategic management process. Why is it important for managers to recognize the interdependent nature of these activities? The three key activities are: * Analysis: Where managers obtain a understanding of the company's internal, external environment, and goals. This helps lay the foundations for the following activities. * Decisions: is the plans that companies come up with to outperform rival companies. By using the analysis they can better decide what strategies work best for their companies, and what they can do when things change to stay ahead of the competition. * Actions: This is when the company distributes necessary resources, and come up with plans to make the strategies a reality. The interdependence of these activities show when the company starts implements their well planned out strategies. Because you can't plan for everything, and things constantly change in/outside of their firm and competing firms. So they will have to keep adapting, changing, renewing their strategies, goals, plans, as the situation dictates. 3. Explain the concept of "stakeholder management." Why shouldn't managers be solely interested in stockholder management, that is, maximizing the returns for owners of the firm—its shareholders?...
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...Favorite Brand Paper Apple is one of the largest and most successful companies in the world. Apple is known for making easy to use and extremely sought after electronic devices such as the IPhone, the IPad and the iPod. Apple connects with consumers of all ages by providing reliable products and excellent customer service, both in their retail stores and through their telephone support line. This type of service builds brand loyalty. They take great pride in the ability to provide product differentiation, market availability, and for getting the upper hand on setting prices. For years Apple was a distant second to Microsoft in terms of their operating system use and sales. However with the launch of a massive advertising campaign a few years ago, made Apple environmentally responsible, put them in an important place in the lives of consumers, and made the brand cool for all ages. According to Perreault, Cannon and McCarthy, “Marketing is the performance of activities that seek to accomplish an organizations objectives by anticipating customer or client needs and directing a flow of need-satisfying goods and services from producer to customer or client” (2009, p.6). Where Apple has evolved and is keeping up with what consumer’s demand of the latest electronic devices, Microsoft has not and their products lack style and are not easy to use. There are several reasons to be passionate about this brand. They market their product very well. They sell good quality electronic devices...
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...Sole traders A sole trader describes any business that is owned and controlled by one person - although they may employ workers. Individuals who provide a specialist service like plumbers, hairdressers or photographers are often sole traders. A hairdresser trimming someone's hair Sole traders do not have a separate legal existence from the business. In the eyes of the law, the business and the owner are the same. As a result, the owner is personally liable for the firm's debts and may have to pay for losses made by the business out of their own pocket. This is called unlimited liability. Advantages * It is easy to set up as no formal legal paperwork is required. * Generally, only a small amount of capital needs to be invested, which reduces the initial start-up cost. * As the only owner, the entrepreneur can make decisions without consulting anyone else. Disadvantages * The sole trader has no one to share the responsibility of running the business with. A good hairdresser, for example, may not be very good at handling the accounts. * Sole traders often work long hours. They may find it difficult to take holidays or time off if they are ill. * They face unlimited liability if the business fails. http://www.bbc.co.uk/ Partnerships Partnerships are businesses owned by two or more people. Doctors, dentists and solicitors are typical examples of professionals who may go into partnership together and can benefit from shared expertise. One advantage of...
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...I have been in sales for the past 6 years and have seen just about every type of sales incentive that there is. I have been incentivized on my individual performance, a team performance, the companies performance and every combination of the 3. I have been incentivized on a short term basis (1 month growth) and on a long term basis (6 month growth) and have seen the advantages and disadvantages in all forms of incentives. The disadvantage with team performance incentives depends on the team and how the performance is graded. Often times, in a group setting, one coworker sees the opportunity to slack off as there are other members that can pull the weight. This can lead to dissension in a group and ultimately will reflect on the performance. The advantage, however, is that when done correctly, a team can collaborate their efforts towards a common goal while creating a synergistic effect. Performance can then be accelerated and each member can be paid accordingly. “Properly designed incentive programs work because they are based on two well-accepted psychological principles: (1) increased motivation improves performance and (2) recognition is a major factor in motivation” (Cascio, 2010 p. 438). These concepts are very applicable to individual incentive performance. When an individual has nobody else to share the incentive with, that means there is nobody to share the workload either. Individuals must be able to motivate themselves and they must be able to accept responsibility...
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