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Description
Flashcards by katie.langridge, updated more than 1 year ago
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Created by katie.langridge
over 8 years ago
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| Question | Answer |
| What is a budget? | Budgets forecast earings and spending for the coming year. They help managers control their spending. Each budget contains financial targets - objectives which help motivate staff monitor performance. The master budget is the total budget for the whole business. |
| Corporate Aims | These are long term targets of a business. They provide the direction for the business and there businesses performance is measured against them. |
| Functional Objectives | These are short term objectives of each major business function e.g. Finance, HR etc. They help to achieve corporate objectives. |
| Corporate Objectives | Medium term targets of a business. They should be SMART, and help to achieve corporate aims. Broken down further into functional objectives. |
| Common Corporate Objectives | -Survival -Profit -Growth -Meeting Stakeholder needs -Market share/ Position -Diversification |
| SMART Objectives | Short term and medium term objectives should be SMART. SMART stands for Specific, Measurable, Achievable, Realistic and Timebound. Example "I want to increase the sales revenue of the company by 10% within 12 months. |
| Why is setting objectives important? | -Setting clear objectives at all levels reduces the risk of failure -However, it does not remove it completely -Staff have a common purpose. -Objectives are used to decide on strategies -Businesses should constantly review their strategies, to see if it will still achieve their objectives. |
| What is a strategy? | The way/ method that will be used to achieve the aim. |
| What is a corporate Strategy? | Corporate strategy is the direction and activities of a business over the long-term. Corporate strategy should give a business competitive advantage. A good strategy makes sure resources are used wisely, and will also keep stakeholders happy. It is set at senior level. |
| What is functional strategy? | This is the plan of action for each functional area which will achieve their functional objectives. Set by each individual department. |
| Why would a business want to globalise | 1. Increase cust |
| Why would a business not want to globalise? | 1. Exposed to more competition 2. Large investment required, meaning a barrier to small firms 3. Legislation differences 4. Language differences (communication diseconomies) 5. Cultral differences. |
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