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OBJECTIVES AND STRATEGIES. Corporate and Functional objectives. IN THIS TOPIC YOU WILL LEARN ABOUT:. Functional objectives and their relationship with corporate objectives The relationship between functional objectives and strategies. Corporate Objectives….
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OBJECTIVES AND STRATEGIES Corporate and Functional objectives
IN THIS TOPIC YOU WILL LEARN ABOUT: • Functional objectives and their relationship with corporate objectives • The relationship between functional objectives and strategies
Corporate Objectives…. • The key to success is to recognise that every business is different! • Corporate objectives are the company wide goals that need to be achieved to keep the business on track to achieve its aims.
Functional Objectives A quantifiable statement of a department’s goals, which should enable it to contribute to achieving the overall business objective.
Linking corporate and functional objectives and strategies… • For the 2012 Olympics
LOCOG Chairman Sebastian Coe revealed the core vision "to stage inspirational Games that capture the imagination of young people around the world and leave a lasting legacy."
Linking corporate and functional objectives… • For the 2012 Olympics the FUNCTIONAL OBJECTIVES might be? • If any of the FUNCTIONS ‘fail’ then …?
Linking corporate and functional objectives… • For the 2012 Olympics • Operations objective is to get the stadiums built on time • Marketing objective is to sell the millions of tickets to fill capacity • Finance objective is to complete with a favourable budget! • HR objective is to recruit all the staff, train and successfully hold the Olympics. • If any of the FUNCTIONS ‘fail’ then …?
Strategies should be SMART SMART Targets Specific- no confusion about what is required Measurable- so you can judge whether it has been achieved Agreed/Achievable – to ensure full buy in. Realistic- An impossible goal is no goal at all Time Based – So progress towards achievement can be measured.
Why is relationship between objectives and strategies so important? Without integrated strategies across the functional areas it will be very difficult for a company to achieve its’ Corporate Strategy. The ability for marketing to achieve its strategy for example may depend on the availability of finance. Therefore each area must be aware of what the others are doing when setting their objectives.
Issues for Analysis… • Do the objectives fit the company? • Are the objectives feasible (SMART)? • Does everyone know the objectives (communication) or are their conflicts? (esp between depts)
Corporate Objectives Finance Functional strategies • We have spent the last five years putting in place strong foundations in line with our long-term plan. We have introduced new products and services in our core business of General Merchandise (GM) and Food, broadened our multi-channel offer, expanded our international presence, improved our property portfolio, and put Plan A at the heart of our business. • We are not immune to the short-term impact of the recession and have had to take action to protect the strength of the balance sheet. As a result we have cut the dividend by 20.9%. While this was a difficult decision for the Board, we believe it is the right thing to do for two main reasons: because economic conditions remain uncertain, and because of the need for us to retain financial strength and flexibility. • Throughout the year we have prudently managed costs and continued our investment in our systems and supply chain so we can improve efficiency across the business. • We also responded to the changing needs of our customers by improving our values without compromising on quality; something we view as short-term pain for long-term gain. As well as helping us through these tough conditions, these steps will enable us to take advantage of the opportunities that lie ahead and maximise value for our shareholders. • With a strong brand, the right products and an experienced management team, we are now: • Increasing the pace of change and operational execution in the business; • Leveraging M&S Direct by building more channels to market; • Building our international portfolio to grow our global customer base; and • Reinvigorating our brand communications. • In addition to leading M&S successfully through the recession, another of my priorities is to ensure there is a strong management team in place and an appropriate succession plan for the business. • As we celebrate our 125th anniversary we do so with an unrivalled reputation for Quality, Value, Service, Innovation and Trust. These core values are as important today as they ever have been. They are all about doing the right thing which is, quite simply, how we do business. Functional strategies Op management Functional strategies HRM Marketing Mission Statement
ICT Research … • Research a company of your choice and highlight their; • Corporate objectives • Functional objectives • Functional strategies
Quick review Q’s • Identify four possible functional objectives • What is meant by ‘functional strategies’? • What is the relationship between corporate objective and functional strategies? (illustrate?)
Essay Question • Financial objectives are only there to please shareholders?
