A statement of objectives is an important element of a business plan. It states clearly in one or two sentences what the new start-up enterprise is seeking to achieve.
Objectives and Ambitions
Objectives themselves have a general criterion and format as they seek to translate the ambitions of the business. They should generally be specific, be quantifiable and relate to a specific time frame.
A general statement such as “The objective of XYZ limited is to be successful within three years” will not communicate any meaningful information to the readers. In all likelihood such a remark will draw more questions than those which it answered.
The statement of objectives may well change over time as the business progresses and certainly at the junction where the previous goals have been achieved.
An outdated or irrelevant objective is likely to confuse and provide little value to the business. Therefore a regular review and where necessary, re-thinking program should be implemented to assess the appropriateness the current statement in the light of prevailing internal and external environmental factors.
Factors Which Might Change Business Objectives
Factors in the environment which may make a change in business objective essential might include
- The absence of sufficient resources to enable the enterprise to meet previously predicted levels of activity.
- The withdrawal from the market of a major competitor could provide the business with unanticipated opportunities for growth.
- Increased government regulation might burden the business with additional unforeseen costs.
- The securing a necessary finance to carry out planned production expansion may not occur as budgeted and therefore result in the scaling back of operations.
Business objectives which are clear, concise and relevant can help focus an enterprise on important matters which can determine both its life and the levels of success it attains.