11 Goals, Objectives, Resources and Strategies

Suresh Kumar Turka

Introduction

Goals

Goals are the plans which justify the establishment of the organisation. It clarifies the specialities of the organisation and explains that how the organisation is different from others. Goals are to be achieved by an organisation over different periods of time. Goals are the result of planning which is related to future. Planning is required both for choosing the goals and attaining the goals. The words aim, goal, mission, objective or purposes are used interchangeably in general practice. A Goal is even more specific and fine than the objective.

Importance of Organisational Goals

Organisational goals are important to regulate and control the functioning of individuals and groups. The following points explain the importance of goals:

1. Define Activities: – It is only the organisation’s goals with the help of which every individuals and group channelize their activities towards goal. The goals prescribe the course of action to individuals and groups which will be helpful and complementary to the achievement of organisation’s goals.

2. Measurement  of  Performance:  –  Goals  provide  a  measure  of  individual’s  or  group’s performance. They may help the organisation members to evaluate the level of their performance in the perspective of organization’s goals.

3. Affect the Organisational Structure: – The various positions to be created at different levels and the relationship among people in the form of authority and responsibility have to be decided on the basis of organisational goals.

4. Nature of the Business: – The goals of a business explain about the nature and character of an organisation. For example, the goal of maintaining the quality of product without much regard to return on investment may help the outsider to hold the organisation and its members in very high esteem. Drucker suggests eight specific areas in which goals have to be set in terms of performance and results and these are;

  • Market Reputation
  • Research & Development
  • Productivity
  • Physical and Financial Resources
  • Profitability
  • Management Performance and Development
  • Employees Performance
  • Public Responsibility

Objectives

Objectives are something that one’s efforts or actions are planned to achieve the target. These are the special target to be achieved by an organisation. Objectives are determined in such a manner as to make the mission of the organisation meaningful. The objective of the whole organisation is laid down very first and then the objectives of different departments are determined for the achievement of the organisational objectives. Objectives are helpful in planning, organising, staffing, directing and controlling.

Features of Objectives

The following are the features of business objectives:

1. Comprehensive and Measurable: – The business objectives should be comprehensive and measurable and must be communicated to the investors, employees, partners etc. Unless the objectives are set the organisation will not be able to compare the actual performance with the planned target.

2. Hierarchy of objectives: –Business objectives are determined at different levels and these are structured according to the hierarchy. All the objectives are not equally important. It should be achieved according to its priority and importance. The most important objective should be achieved first.

3. Multiplicity of objectives: – Organisational objectives are multiple in natures. The primary objective of every business is profit followed with customer satisfaction. Business also has objectives towards society that comprises of employees, shareholders, creditors, government etc.

4. Achievable and specific: – Business objectives must be achievable and should be framed taking into consideration its capabilities and resources. The objectives must be specific in terms of time, quality and quantity. Specific objectives help in the accomplishment of those objectives in the specified time frame and resource availability.

5. Flexible: – Business objectives should be flexible and must not be rigid. Business environment keeps on changing. Therefore the objectives should be changed or modified according to the changing situation. The objectives must be able to reframe in the light of changes in the environment.

Importance of Objectives

1. Existence of the Business: – Every business is established to achieve its objectives. The existence of the business remains intact till the objectives are not achieved. Without objectives the organisation is meaningless.

2. Proper Utilisation of Resources: – When the objectives of an organisation are determined it ensures the proper utilisation of available resources as all the departments make effort and create coordination for the accomplishment of these objectives.

3. Provide a base for Planning: – Objectives are the basis of plan and in planning objectives are determined firstly. Different types of plan like policies, procedures, strategies, rules are also depending on the objectives.

4. Helpful in Control: – Objectives also provide a base for controlling. Under control actual performance is measured with predetermined work and the deviations are found so that corrective action may be taken keeping in view the organisational objectives.

5. Establish good Relationship: – Objectives establish a beautiful relationship between the management and employees. The people working in the organisation cooperate with the management because their own objectives are fulfilled. Similarly, management also cooperate with employees to achieve the organisational objectives. So, the determining the objectives create a good relationship within the organisation.

Difference between goals and objectives

1. Goals are broader than objectives and are not specific enough to be measured. Objectives are narrow and are set for certain tasks in particular.

2. Goals are general while objectives are specific. Goals are just general intentions towards the attainment of something while objectives are precise action for accomplishment of a specific task.

3. Goals may be intangible while objectives ought to be tangible. Goals may be directed at achieving non-measurable things while objectives may be targeted at getting measurable things or tasks.

4. Both have a certain time frame. Goals usually have a longer time-frame than objectives. Objectives are usually precise targets set for a short term. Goals may be set for a longer term but many objectives may be set within that goal.

5. Goals may or may not be measured, but in most cases objectives are measurable.

Resources

A resource is a source or supply from which benefit is produced. Resources are transformed to produce benefit and in the process may be consumed. Resources have three main characteristics like utility, limited availability, and potential for depletion or consumption. In a business organisation different resources play an important role for its smooth functioning and help in future planning, expansion and accomplishment of the objectives. Business resources include the human resources, financial resources, physical resources and information resources.

Human Resources

Human resources mean the people. In a business organisation only the human resources are there which ensure the proper utilisation of other resources. Human refer to the skilled workforce in the organisation and resources refer to the limited availability. So, there is always a need of management which ensure the proper utilisation. Human resource management is the planning, organising, directing and controlling of the procurement development compensation integration and separation of human resources to the end that individual, organisational and social objectives are accomplished”.

Significance of Human Resources

Human resources are the valuable assets of the business organisation. They are their strength. To face the new challenges on the fronts of knowledge, technology and changing trends in global economy needs effective human resource management.

  • Good human resource practice can help in attracting and retaining the best people in the organisation.
  • Developing the necessary skills and right attitudes among the employees through training, development, performance appraisal, etc.
  • Ensure effective utilisation of other available resources.
  • Ensuring that enterprise will have in future a team of competent and dedicated employees.
  • Employment opportunities multiply and eliminate waste of human resources. Developing people on continuous basis to meet challenge of their job.
  • Promoting team-work and team-spirit among employees.
  • Offering excellent growth opportunities to people who have the potential to rise.
  • Providing environment and incentives for developing and utilising creativity.

Financial Resources

Financial resources are the money available to a business for spending in the form of cash, liquid securities and credit lines. Before starting a business an entrepreneur needs to secure sufficient financial resources to operate and manage efficiently. Every business organisation whether it is small or large required finance for daily operations and to meet expenses and payments. It helps in business growth, to face competition, to keep business operational and to meet the short term and long term capital requirements.

Significance of Financial Resources

  • Every new business required some seed money/capital to start its operations and put an idea into motion.
  • The strategic use of financial instruments like loan, debt and investment is the key to success of every business.
  • In case of business cycles and recession financial resources helps to come over the situation.
  • Helps in long term (capital budgeting) and short term (working capital) financial requirement.
  • Maximize the shareholder wealth and proper allocation of resources at right place and at right time.
  • Provide a base for profit planning, financing and investing decision.
  • Affect the goodwill and image of the business.

Physical Resources

Physical resources are the material assets that a business owns, including buildings, materials, manufacturing equipment, office furniture and needed for day to day operations. These resources are essential for each and every organisation for their operational activities. These are the basic requirements for any business.

Significance of Physical Resources

  • Essential for the business to carry out its day to day activities and running of the organisation.
  • Helps in efficient production and sales management.
  • Clarify the organisation problem and provide a solution which helps in achieving the organisational goal.
  • Keeps the systematic record of all business related activities which, further helps in decision making.
  • Make possible efficient use of human, financial and information resources.
  • Helps in satisfying customers need and create customer retention.

Information Resources

Information resources are defined as the data and information used by an organization. Examples of information resources are databases with customer purchase information.

Significance of Information Resources

  • To control the creation and growth of records a good management information system is required.
  • Good records management programmes improve efficiency and productivity of a business organisation.
  • Management information system provides the required information to the management which helps in better decision making.
  • MIS ensures the regulatory compliances and minimizes the legal risk.
  • Provides latest information regarding competitors, customers and market. Provides a data base for future records

Strategy

A strategy is a comprehensive plan which takes into account the environmental opportunities and threats and the organisational strengths and weaknesses and provides an optimal match between the organisation and the environment to achieve the organisational objectives. Strategy formulation is the task of top level management and it is must to scan and understand clearly the business environment before framing the strategy. All the strategic decisions are greatly influenced by the business environment. Strategy defines the future decisions regarding the organisation’s direction and scope in the long run. For example, Choice of advertising media, sales promotion techniques, channels of distribution, etc.

Features of Strategy

  • Strategy consists of general programme of action to be perused for achieving organizational goals.
  • Strategy includes tactics used by the opponents. They are meant not only to achieve business goals but also to counter certain steps taken by the competitors.
  • Strategy is a right combination of both internal and external factors. The strengths and weaknesses of the organization and the likely impact of external factors should be analyzed before deciding a policy for the future.
  • Strategies are never static. They have to be modified or changed as per the needs of the situation.
  • Strategy is forward looking. Its orientation will be towards future. The past actions can be used as a guideline for future decisions.
  • Strategies are formulated only at the top level management. Lower level management is only expected to execute them.

Formulation of a Strategy

The process of formulation of a strategy is given below:

1. Knowledge of Business Objectives and Values

Business strategies are linked to the objectives and values followed by a business. The objectives provide guidelines for making strategies at various levels in the organization. The values used in the organisation also help in which way the strategies will be framed.

2. Analysis of External Environment

The external environment consists of economic, technological, marketing, political and social factors prevailing at that time. All those factors have a direct bearing on the business and all business plans and strategies will be framed in order to benefit maximum from the existing environment. There is a need of continuous monitoring of external environment and its likely impact on the business. So, that timely strategy may be formed for converting threats into opportunities.

3. Analysis of Internal Environment

An appraisal of internal environment will help in knowing the strengths and weaknesses of the organization. Unless otherwise a detailed review of various activities is undertaken it will not be possible to frame proper strategies.

4. Examining Alternative Strategies

There should be a proper matching between external and internal factors. The organizational strengths and weakness should he kept in mind while studying the impact of external environment. There may be a gap between the desired results and actual performance. In order to fill this gap some alternative strategies are required.

5. Choice of Strategy

The choice of a suitable strategy is an important step in strategy formation. Various alternative strategies are analyzed and their strengths in achieving organizational goals are assessed. While making choice of a strategy the various factors must be considered and the final choice of a strategy should be a well thought decision.

Evaluation of Strategies

The success of organization will depend upon the successful implementation of strategy. A strategy should help in creating consistency in the organization.

  • Strategy should be suitable to the environment existing outside the organization.
  • The strategy should be in conformity with the resources available.
  • The strategy should also take into consideration the risk element in it. The amount of resources committed will determine the degree of risk.
  • The strategy will be successful only if it has helped in improving organizational performance.

Conclusion

Goals are to be achieved by an organisation over varying periods of time. Goals are the result of planning which is related to future. Planning is required both for choosing the goals and attaining the goals. The words aim, goal, mission, objective or purposes are used interchangeably in general practice. On the other hand, Resources are transformed to produce benefit and in the process may be consumed. A strategy is a comprehensive plan which takes into account the environmental opportunities and threats and the organisational strengths and weaknesses and provides and optimal match between the organisation and the environment to achieve the organisational objectives.

 

 

References:
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  • Kumar Arun and Rachna Sharma, Principles of Management, Atlantic publishers, 2000
  • Diffen, “Goals vs. Objectives and Differences”
  • Micale E. Belicove, “Understanding goals, strategy and objectives” Forbes,2013
  • Talathi Rakesh, “Strategy Formulation: Process and Modes”
  • Henderson K J, “5 Resources you need to start a business”
  • Riley, Jim, “Strategic resources of a business”