Describes a desired position for the company in the far future (“Where do we want to be?”)
Mission
Purpose of business, states what the business is and does
How the vision statement will be achieved (“How do we get there?”)
Vision and mission statement
Positive, ideal goals
Parallel to business
Customer centric
Answers:
Where are we now?
Where do we want to be?
How do we get there?
How do we know we are there?
Aims, objectives, strategies, and tactics
Aims – long term goals of what the company wants to be
Objectives – shorter term goals that are specific and measurable
Individual targets, departmental objectives, divisional objectives, corporate objectives, mission, aim (pyramid, base to height is left to right)
Guides and unifies management and workforce
Basis for strategic planning
Builds trust and goodwill
Changing objectives and innovations (due to changes in environment)
Companies change objectives when responding to internal and external changes
Context of company must be considered
Internal factors
Corporate culture – way the organization works (aggressive, chill, etc.)
Type and size of organization – small or big businesses run differently
Age of organization – change must be consistent with times
Financial status – profit goals, how much money the business has to use
Risk profile of shareholders – If investors are risk-averse or risk-loving
Private/Public sector
Private = profit
Public = serve
External
State of economy – strong or depressed economy affects the company too
Government constraints – government telling you not to expand somewhere
Presence and power of pressure groups – (e.g. not to expand in the endangered locations)
Corporate social responsibility (CSR)
Concept whereby organizations consider the interests of society by taking responsibility for the impact of their activities on various stakeholders
Benefits:
Better employee recruitment and retention
Sense of value/purpose for employees
Boosts company’s image/reputation
Risk management against scandals, accidents, etc.
Appeases pressure groups
Brand differentiation and smoother operations
Customer loyalty & goodwill
Disincentives:
High compliance costs can lower profits
Forced to use materials that are specialized and may reduce profit
Ethics are not universal or unchanging anyway
Lower profits may decrease personal bonuses which may lead to greediness
Attitudes change over time; acceptable practices before are unacceptable today.
CSR objectives adapt to changes in social norms/hot issues (i.e. tattoos, dyed hair, jeans, single parents, gender bias, child labor, smoking, obesity, global warming, etc.)
SWOT analysis
Qualitative form of assessment
Guides management for future strategies
Used alongside STEEPLE, which helps to further identify opportunities and threats
Internal factors
Strengths – advantages that are basis for developing competitive advantage.
e.g. experienced management, patents, loyal workforce/customers
Weakness – negative factors
e.g. poorly trained workforce, limited capacity, obsolete equipment, etc.
External factors
Opportunities – potential areas for expansion of the business and future profits
e.g. political/economical policies, social statistics & trends, etc.
Threats – hindrances to the business
e.g. economic environment, market condition competitors.
Ansoff Matrix
Analytic tool to determine growth strategy by focusing on product/market combination
