Business Goals
Introduction
Setting competitive goals is significant for businesses. This report will clarify “goals” by explaining definition, importance and features of goals. It will also outline some business financial and non-financial goals. Furthermore, it will explain a mix of goals that a business might want to achieve by using examples of Qantas and Coca-Cola Amatil.
Clarification of Goals
A goal is a desired outcome that an individual or business intends to achieve within a particular time period. Goals can motivate businesses to get better results by helping managers to make decisions, inspire the group members and carry out evaluations. To become more effective, goals should be S.M.A.R.T., which means specific, measurable, achievable,
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➤Profitability
Profitability is the ability of an organization to maximize its profits. (Chapman, S., Norris, C., Devenish, N.&Merritt, L, 2005) It is important as a major indicator of a business’s success is its profit level.
➤Liquidity
Liquidity refers to the ability of the business to pay short-term debts. Controlling cash flows ensures businesses to meet financial obligations and have sufficient cash when needed. (Chapman metal., 2005)
➤Growth
Growth is the ability of the organization to increase its size or value in the long run, which depends on the power of a business to increase sales, profits and market share using existing assets. (ibid.).
Outline of Some Non-Financial Goals in a Business
On the other hand, there are many non-monetary objectives that businesses might want to achieve, such as improving customer service, brand recognition and ecological sustainability.
Customer Service
Good customer service helps businesses remain clients and generate more repeat revenue.
Brand
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In Fiscal Year 2014(FY14), it set a mix of goals, including profitability, customer service and liquidity.
Profitability: Qantas announced details of its $2 billion cost reduction plan in 2014, which helps Qantas take action to continuously reduce costs in every department by changing the network and so on. (“Qantas Has”, 2014). The fewer funds a business spend on expenses, the more profit the business may earn since P=TR-TE. As a consequence, this goal will help Qantas increase profitability.
Customer Service: Chief Executive Officer Joyce said:”we will keep delivering outstanding service for our customers, such as the upgrade of our Airbus A330 fleet…and the service that Qantas passengers receive”. (ibid.). With the development of facilities, an improvement on passengers’ experience occurred. Thus, there will be a growth of Qantas loyalty with a positive customer response.
Liquidity: Qantas has a total liquidity of $3 billion as at 31 December 2013. It continues to target positive free cash flow.(ibid.). The set of this goal will help Qantas maintain flexibility to make further changes in business operations if needed.
➤Coca-Cola
• Qantas had to make an increased profit and pay a dividend to its shareholders which increased over the years of management
Despite the growth in the market, Qantas International’s market share has been falling over the past 10years, from 34% in FY02 to 16% in FY13. The entry of Virgin Australia in 2000 in part explains this, however Virgin’s growth also coincided with the demise of Ansett in 2001 “… Virgin Blue will initially increase capacity on existing routes while evaluating what c...
For economic factor, Qantas Airways Limited was stable because the economic in Australia was in good
We probably all agree that the primary objective of any business is to achieve revenue and attain a certain profit. But then here is the question that we might ask, is profit the only element that should be considered when making business decisions? In my point of view the answer is no as I will try to demonstrate throughout this paper. One quick alternative of what should be the first top priority of a business is creating a customer as Dr.Peter Drucker said. According to him “The customer is the foundation of a business and keeps it in existence. He alone gives employment. To supply the wants and needs of a consumer, society entrusts wealth-producing resources to the business enterprise.” (Santayana, George. Is The Tyranny Of Shareholder Value Finally Ending? )
In regards to the corporation’s balance sheet, it is necessary to place an importance on liquidity ratios to demonstrate the company’s ability to pay its short term obligations such as accounts payable and notes that have a duration of less than one year. These commonly used liquidity ratios include the current ratio, quick ratio, and cash ratio. All three ratios are used to measure the liquidity of a company or business. The current ratio is used to indicate a business’s ability to meet maturing obligations. The quick ratio is used to indicate the company’s ability to pay off debt. Finally the cash ratio is used to measure the amount of capital as well short term counterparts a business has over its current liabilities.
...onclude, the strategies used by Qantas in dealing with these influences have all been relatively effective. The use of technology has been the most effective in providing the business with a competitive advantage and has very little downsides when compared to other strategies. Operations management has dealt with globalisation effectively and greatly reduced costs and provided the business with a competitive advantage at the expense of the business reputation and individuality. Strategies which involve product differentiation have been used very effectively and are beneficial to Qantas. However the more cost leadership strategies that Qantas uses, the more likely that the business will lose it’s own individuality as the “Red Kangaroo”. In general, Qantas has been able to keep it’s business running relatively successfully and has dealt with it’s influences very well.
The company made $970 million profit in the year 2008, $123 million in 2009 followed by $116 million in 2010. The number of passengers travelling in Qantas in 2008 was 33670 million, 33,969 million in 2009 followed by 32,489 million.
Liquidity for a company is “the ability of a firm to meet its near-term obligations as they come due” ( Walther, Financial Accounting, 2011, Chapter 4, p.57 ). Investors and creditors look at how liquid a company is in order to determine the company’s ability to meet it’s scurrent obligations. Three ratios to be considered are Working Capital, the Current Ratio, and the Quick Ratio. Three companies have been chosen and their Annual Reports as reported to the Securities and Exchange Commission (SEC) will be reviewed. A determination for each company’s liquidity position will be discussed based on the findings and compared to Management’s view as stated in the Annual Reports. The three companies chosen are Dell Inc., Genesco Inc., and ConAgra Foods Inc.
The set goals should also be those that are favourable to the workers, as well as the management team as a whole. This is to ensure that they can be met easily without much difficulties involved.
The nature of cash direct proportionate with the liquidity of asset. Cash is the most liquid asset being the most vital element of the current assets; rather it would be more precise to state that it is only the asset with the liquidity with minimum time period. Cash may be construed as cash in hand or cash at bank or both. With the liquidity prospect cash in hand and cash at bank collectively comprise of cash of any Company. Even the bank deposits and securities with bank can be covered in cash.
Most companies are profit oriented. Companies survive and live on profit. Even governmental institutions, NGO's and NPO's are profit oriented, what they do with profit is different though. Saying this means that companies seek always to be at a position where profit is maximized. As we know by now this happens when MC=MR but this is an always changing point as supply and demand are dynamic, effectively meaning that if firms get it right once they can't just do the same eternally, they still need to adapt to every market factor as a new change is a new reality all together that needs to be studied and addressed. All of these changes happen in what is called the market, where suppliers and consumers meet to reach a level that suits the interests of both parties involved.
“The Goal” is a book written by Eliyahu M. Goldratt and Jeff Cox in 1984. The book is very famous in the management field. In 2004, the author published the third revision of it and celebrated selling over than three million copied of it around the world. Also, the goal book is taught in over than 120 collages. The book was recommended by my professor to be read and summarize as an extra credit.
When establishing goals, leaders must impart a notable strategy to succeed and delineate their motive and core values in essence that is notable and attainable. A powerful vision summons and encourages people to situate their vitality in a common ground. By establishing goals, the organization will expand its capability to fulfill goals, construct employee’s reliance and confidence, ameliorate team’s connection and increase all-inclusive fulfillment and gratification. Creating a vision can be a venture or a challenge, however following the six steps Clark (2014) mentioned – “vision, goals, objectives, tasks, timeless and follow up” can be justly straightforward.
Motivation of its employees to provide exceptional services to their customers by supporting their development, providing opportunities for personal growth and fairly compensating them for their successes and achievements.
A financial budget outlines how a business receives and spends money on a corporate scale, including revenues from core business plus income and co...