🎯 Business Objectives
Big Idea: Objectives are specific, measurable goals that a business sets to achieve its mission. They should be SMART: Specific, Measurable, Achievable, Relevant, Time-bound.
Strategic vs tactical objectives
- Strategic objectives — long-term, big-picture goals set by senior management (e.g. 'become market leader within 5 years')
- Tactical objectives — short-term, specific steps that help achieve strategic goals (e.g. 'increase social media followers by 20% this quarter')
Common business objectives
- Profit maximisation — earning the highest possible profit
- Growth — increasing sales, revenue, market share or number of locations
- Market share — capturing a larger percentage of total market sales
- Survival — staying in business, especially important for start-ups or during crises
- Social and ethical objectives — doing good for society or the environment
- Shareholder value — increasing the value of the company for its owners
A start-up restaurant in Year 1 focuses on survival (covering costs). By Year 3, its objective shifts to growth (opening a second location). By Year 5, it aims for profit maximisation. Objectives evolve as the business develops.
Marketing objectives
Marketing objectives are specific goals for the marketing function that support the overall business objectives.
- Increase brand awareness — make more people recognise and recall the brand
- Increase market share — capture a larger portion of total market sales
- Enter a new market — expand into a new geographic area or customer segment
- Improve customer loyalty — increase repeat purchases and reduce customer churn
- Launch a new product successfully — achieve target sales within a set timeframe
If asked to 'state two marketing objectives': 'increase market share' and 'improve brand awareness' are safe, reliable answers. ✅
Making objectives SMART
- Specific — clearly state exactly what you want to achieve
- Measurable — include numbers so you can track progress
- Achievable — realistic given the business's resources and situation
- Relevant — aligned with the overall mission and strategy
- Time-bound — include a deadline
Bad objective: 'Sell more products.' This is vague, unmeasurable and has no deadline.
SMART objective: 'Increase online sales of Product X by 15% within 12 months through targeted Instagram advertising to 18-25 year olds.' This is specific, measurable, achievable, relevant and time-bound.
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Objectives evolve over time
A business's objectives change as it grows, faces new challenges, or operates in different market conditions.
- Start-up phase: survival — just staying alive and covering costs
- Growth phase: market share and revenue growth — expanding the customer base
- Maturity phase: profit maximisation — extracting maximum returns
- Decline/crisis: survival again — cutting costs and restructuring
External factors that change objectives
- Economic recession → shift from growth to survival
- New competitor enters → focus on maintaining market share
- New technology → objectives around innovation and adaptation
- Government regulation → compliance becomes a priority
In exam scenarios, identify what stage the business is at and what external pressures it faces. This tells you what its objectives should be.