iGCSE Business Edexcel

Business Objectives

Section 1: Understanding Business Objectives

• Businesses are established with a set of specific goals known as business objectives. These define what a business wants to achieve.

• Business objectives act as a guideline for the daily operations and decision-making processes within a business.

• Often, objectives are established on the basis of the SMART principle, that is the objectives should be Specific, Measurable, Achievable, Relevant, and Time-related.

Section 2: Common Types of Business Objectives

• Profit maximisation: Many businesses aim to increase their profits to the maximum level possible. Profit is the difference between revenues and costs.

• Survival: New businesses and those in extremely competitive markets might focus on survival as their key objective.

• Growth: Businesses often aim to expand their operations, which could mean increasing sales, number of employees, market share, etc.

• Increasing market share: This objective relates to gaining dominance over competitors within a specific market.

• Providing quality products or services: Maintaining high quality can improve reputation and boost sales.

Section 3: Importance of Business Objectives

• Business objectives aid in planning and decision-making, helping businesses navigate towards their goals.

• They assist in directing employees’ efforts and focus towards important areas of the operation.

• They motivate employees by giving them something tangible to strive for.

• They form the foundation for monitoring progress and assessing performance by providing clear and quantifiable goals.

Section 4: Modification of Business Objectives

• Adapting objectives is essential in response to changing internal and external factors.

• Internal changes could include new management, changes in size, technological advancements etc.

• External changes could be changes in market trends, laws, competitor activity, economic conditions, etc.

• Remaining flexible and able to adapt objectives is key to remaining successful in the ever-evolving business environment.