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How objectives might change over time

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Objectives and Business Decisions

 A Level/AS Level/O Level

Your Burning Questions Answered!

Explain the different types of business objectives and how they can influence decision-making.

Discuss the factors that can lead to changes in business objectives and the implications for strategic planning.

How can changes in the external environment impact business objectives and how should organizations respond?

Analyze the relationship between short-term and long-term business objectives and the challenges in balancing these priorities.

Evaluate the role of stakeholders in shaping business objectives and assessing their impact over time.

Objectives and Business Decisions: How Goals Shape the Game

Imagine you're playing a video game. You have a clear goal, like reaching the final level or collecting all the power-ups. Just like in a video game, businesses also have goals, called objectives. These objectives guide every decision they make, from what products to sell to how much to spend on advertising.

1. What are Objectives?

Objectives are specific goals that a business wants to achieve. They are the "why" behind everything a company does. Think of them as the roadmap to success.

Here are some common business objectives:

  • -Increase Profitability: Every business wants to make money. This objective focuses on increasing revenue and minimizing costs.
  • -Grow Market Share: Companies strive to capture a larger portion of their target market. Think of the phone market - Apple wants to sell more iPhones than Samsung.
  • -Improve Customer Satisfaction: Happy customers are loyal customers. This objective focuses on providing excellent service and quality products.
  • -Expand into New Markets: Reaching new customers and expanding into new territories is a key growth strategy.
  • -Develop New Products: Innovation is vital for staying relevant. Creating new and improved products helps businesses stay ahead of the competition.

2. How Objectives Drive Business Decisions

Think of each objective as a lens through which a business views its choices.

  • -Example: A company with the objective of "increasing profitability" might decide to lower production costs by moving manufacturing facilities to a country with cheaper labor.
  • -Example: A company focused on "growing market share" might invest heavily in advertising campaigns targeted at specific demographics.

3. Objectives Change Over Time

Just like video game levels get harder, businesses face evolving circumstances. This means their objectives can change over time.

  • -Example: A start-up company focused on "survival" in its early years might shift its focus to "growth" once it establishes a solid customer base.
  • -Example: A company might adjust its objectives based on economic changes, like a recession, or new technological advancements.

4. Examples of Objectives in Action

  • -Netflix: Started by offering DVD rentals, Netflix shifted its objective to streaming online content and became a global leader in entertainment.
  • -Tesla: Initially focused on electric sports cars, Tesla now aims to become a mass-market electric car manufacturer.
  • -Spotify: From a music streaming service, Spotify has expanded its objectives to include podcasting and live events.

5. Importance of Clear Objectives

Clear objectives are crucial for business success. They:

  • -Provide direction: They give everyone in the company a shared vision.
  • -Focus efforts: They help businesses prioritize tasks and allocate resources effectively.
  • -Measure progress: They provide a framework for tracking performance and making adjustments.

Think about it: What are some objectives you might set if you were running a small business? How might those objectives change as your business grows?

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